Current Report No. 45/2013: Execution of debt sale agreements; value of agreements between the Group exceeds threshold value
June 25th 2013
The Management Board of KRUK S.A. (the Company) reports that on June 25th 2013 a subsidiary of the Company, PROKURA Niestandaryzowany Sekurytyzacyjny Fundusz Inwestycyjny Zamknięty (PROKURA NS FIZ), executed two debt sale agreements with Bank Zachodni WBK S.A. of Wrocław (the Bank), a Santander Group company. The agreements provided for, respectively, the purchase by PROKURA NS FIZ of retail debt portfolios and the purchase by PROKURA NS FIZ of SME debt portfolios, comprising the Bank's receivables from debtors under agreements and other transactions, with a total nominal value of PLN 422.1m. In Current Report No. 44/2013 of June 12th 2013, the Company reported the Bank's positive decision concerning a possibility of executing these debt sale agreements subsequent to an auction process.
As a result of the execution of the abovementioned agreements, the total value of all agreements between companies of the KRUK Group and companies of the Santander Group executed between February 19th 2013, when the Company issued Current Report No. 9/2013 with the previous summary of the value of agreements with the Santander Group, and the date of the present Report has amounted to PLN 58.2m (VAT exclusive), thus exceeding 10% of the Group's revenue for the previous four financial quarters, which satisfies the materiality criterion.
From among the agreements subject to the summing up, the one with the highest value is the retail debt portfolios sale agreement (the Agreement). The Agreement provides for the purchase of approximately 72.4 thousand debt claims, with a total nominal value of PLN 354.7m, for a price of PLN 46.2m. The Agreement provides for a condition precedent that the debts would be assigned to the Buyer subject to payment of the price. The price was paid today, i.e. June 25th 2013. The purchase was financed with proceeds from a bank loan. The purchased debt portfolios will be recognised in PROKURA NS FIZ's accounting books at acquisition price.
Other terms and conditions of the Agreement do not differ from those commonly used in agreements of such type. The Agreement does not provide for any contractual penalties that might exceed the equivalent of at least 10% of the Agreement’s value or at least the złoty equivalent of EUR 200,000 (translated using the mid exchange rate quoted by the National Bank of Poland for the Agreement execution date). There are no links between the Company, its management or supervisory personnel and the Bank and its management personnel.