The EPN Group Announces Sale of 47 Real Estate Properties for US$1.4 Billion

SKOKIE, Ill., Jan. 11, 2012 /PRNewswire/ -- EPN GP, LLC and EPN EDT Holdings II, LLC (collectively, "EPN" and together with their affiliates "EPN Group") entered into an agreement to sell 47 shopping centers located throughout the USA (the "Properties"), to BRE DDR Retail Holdings LLC, a joint venture between Blackstone Real Estate Partners VII L.P. and/or its affiliates and DDR Corp. and/or its affiliates, for a purchase price of US$1.428 billion. Total property level debt to be repaid by EPN or assumed by BRE DDR Retail Holdings LLC is approximately US$934 million as of the date hereof.

In addition, the sellers shall retain all restricted and unrestricted cash upon the closing of the transaction which amounts to approximately US$30 million at the date hereof. Following the sale of the Properties, EPN Group will continue to hold two properties located in the United States valued at approximately US$43 million with total non-recourse secured debt of approximately US$14 million. In September 2011, EDT Retail Trust ("EDT"), the entity through which the Properties were held at the time, distributed an interim dividend payment of US$26 million to EPN.

The transaction is expected to close in June 2012, and is subject to the completion of a limited due diligence investigation by the purchaser to be completed by the end of January 2012, approval of the applicable lenders to the assignment and assumption of the above mentioned assumed debt, and satisfaction of certain other closing conditions.

EPN first acquired its interest in the Properties in June 2010 by investing approximately US$116 million in EDT, then an Australian publicly traded trust (through which the Properties were held at the time), and its managing entity. Following completion of that transaction, EPN became EDT's largest unitholder, holding an approximately 47.8% ownership interest in EDT. In March 2011, EPN commenced an off-market takeover bid for all of the units in EDT not already held by EPN, which was successfully completed in August 2011. Upon completion of that transaction, EPN became the holder of 100% of the outstanding units of EDT, at an additional cost of approximately US$242 million.

Alex Berman, EPN Group's Co-Founder and Chief Executive Officer, commented: "Sale of the EDT portfolio is a bittersweet event for EPN Group. On one hand, we have enjoyed immensely our association with EDT and DDR, and wish well to Blackstone and DDR, two of the most prominent and sophisticated real estate investors. On the other hand, we are proud of EPN's ability to successfully acquire, create value and realize significant profit for our investors on a large and complex investment in a span of two years. The transaction positions EPN and its team well for the next business stage. EPN Group sees further exciting investment opportunities and intends to continue raising funds. We look forward to building up on our knowledge and experience, expanding the EPN Group platform, and pursuing new real estate investments on behalf of its existing and future investors."

JP Morgan served as advisor to EPN Group.

EPN Investment Management LLC and EPN Fund GP LLC (together with their affiliates "EPN Group") are entities jointly formed by Elbit Imaging Ltd. ("Elbit"), its subsidiary Plaza Centers N.V. ("Plaza") and Eastgate Property LLC and its affiliates ("Eastgate") in order to pursue real estate investments in the United States. In 2009, the venture formed EPN Real Estate Fund, LP, a real estate investment fund that was jointly established by Elbit, Plaza and Eastgate, focused on investments in the U.S. retail and commercial real estate sectors (the "Fund").The Fund secured from Menora Mivtachim Insurance Ltd. ("Menora") and certain of Menora's affiliates, $31 million in capital commitments. EPN Group intends to continue raising investment funds to take advantage of real estate opportunities in the United States through direct acquisitions and joint ventures with leading real estate operators and owners of relevant assets or portfolios.

SOURCE EPN