MADRID, March 21 Spanish property company
Colonial said on Friday it has abandoned plans to sell
part of its 53 percent stake in French business Societe Fonciere
Lyonnaise (SFL) and will instead issue more new shares
to raise funds.
Barcelona-based Colonial, already in a deep restructuring
plan to emerge from Spain's 2008 real estate market crash, said
it will ask shareholders to approve on April 8 a new rights
issue worth 266 million euros ($367 million).
This comes on top of an already-approved 1 billion euro
capital raising plan which will include the injection of cash
from new investors in exchange for a stake in the company.
The investors, including Spain's Villar Mir group which will
hold about 30 percent of Colonial, had conditioned their
investment on Colonial retaining control of the French property
firm, considered the Spanish company's crown jewel.
Spain's own real estate sector is also making a comeback,
with new property investment vehicles attracting U.S. fund
managers George Soros and John Paulson. [ID:nL6N0M038J
($1 = 0.7255 Euros)
(Reporting by Jose Elias Rodriguez; Writing by Tracy Rucinski,
editing by William Hardy)