This is a very interesting turn of events in the recent saga of the various Homburg enterprises and I'd suggest in the long term that the Company's continued investment in Charlottetown may slide a bit with Mr. Arnold now taking a smaller role in the business... Richard and Mike had a lot of confidence in Charlottetown and PEI and let’s hope it continues under the new regime...
Homburg Invest provides update on recent developments
§ Published: 2011-09-01
HALIFAX, Nova Scotia. September 1, 2011 - (TSX: HII.A & HII.B and NYSE Euronext Amsterdam: HII) - Homburg Invest Inc. ("HII" or the "Company") announced today two resignations from its Board of Directors and the appointment of a new chairman of the Board.
Michael H. Arnold, C.A. has resigned as a director and as Chairman of the Board. He will continue to provide special advisory services to the Board. Dr. Trevor A. Carmichael has also resigned as a director. Neither Mr. Arnold nor Dr. Carmichael will stand for re-election to the Board at the Annual Meeting of Shareholders.
Mr. Hartmut Fromm, a director of HII, has been appointed by the Board to the position of Chairman. Mr. Fromm is Co-Founder and Senior Partner of Buse Heberer Fromm in Berlin, Germany. He is also Chairman of the Board of IMW Immobilien SE.
As a result of the foregoing, the Board of Directors currently consists of four directors, of which three are independent.
Update on Recent Events
On August 26, 2011, Homburg Canada Inc. ("HCI"), a company controlled by Richard Homburg, issued a news release stating that it would not follow through on its announced intention to make an offer for all outstanding shares of HII not already owned or controlled, directly or indirectly, by HCI.
HII wishes to make it clear that it never received a formal binding offer from HCI or Richard Homburg to purchase the shares not already owned by them in the Company. As disclosed on July 25, 2011, the Board of Directors of HII has only rejected a non-binding proposal made by Richard Homburg to privatize HII (the "Proposal") because the Proposal was not in the best interest of HII and its stakeholders.
To the knowledge of the Board of Directors of HII, the financing required for the implementation of the Proposal was never committed. Furthermore, the Proposal involved the use of HII's most liquid asset, namely the units of Homburg Canada Real Estate Investment Trust that it holds, as a means to finance the privatization, and if implemented would have seriously impaired HII's financial flexibility.
Relationship with Netherlands Authority for Financial Markets (AFM)
The Company strongly believes that it has acted in good faith to fulfill the requirements of the Instructions issued by the AFM previously disclosed on May 26, 2011, and continues to work diligently to resolve the impasse with the AFM and to avoid the loss of its licence as a financial institution in The Netherlands.
The AFM has granted a two-week extension to HII to allow the Company to submit reasons to the AFM as to why the Company's licence as a financial institution in The Netherlands should not be revoked. HII reminds investors that the letter from the AFM conveys an intention to make a decision and is not definitive.
HII to Vigorously Contest Claim for Damages by HCI
On August 30, 2011, HII announced that it had received a claim for damages totalling approximately $27 million from HCI as compensation for the termination by HII of the master property and asset management agreement between the Company and HCI.
HII maintains that it terminated the agreement as a result of breaches by HCI of its obligations under the agreement, and as such holds the position that no compensation is payable to HCI. The Company rejects the claim for compensation and will vigorously contest it, should the matter come before the Courts.
Communications with Stakeholders in the Netherlands
Due to the increasing number of enquiries from shareholders and debt holders in the Netherlands, HII is in the process of setting up a Netherland's based communications channel. Additional information will be announced shortly.
About Homburg Invest
Homburg Invest Inc. owns and develops a diversified portfolio of quality commercial real estate including office, retail, industrial and development properties throughout Europe and the United States, as well as an interest in Homburg Canada Real Estate Investment Trust. The head office of the Company is located in Halifax, Nova Scotia.
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