ProGreen Signs LOI With AMREFA to Acquire All of Its Property Holdings in the U.S.
BIRMINGHAM, MI–(Marketwired – Dec 29, 2015) – ProGreen Properties, Inc. (ProGreen), (OTC PINK: PGEI), is pleased to announce that a letter of intent has been signed with American Residential Fastigheter AB (AMREFA) (Sweden), for the acquisition of 100% of their U.S. subsidiary, American Residential Gap LLC (ARG). This will result in ProGreen taking over 13 rental properties as well as a large property that has been completely rebuilt and is now ready to be sold on the open market. All properties are located in Oakland County, Michigan. Net value of the properties after debt is estimated at $1.1M. Following all required approvals from AMREFA stockholders, we expect to complete this transaction in late January 2016.
In this transaction AMREFA will receive preferred shares, convertible into common stock or redeemed after 12 months in exchange for the sale to us of their subsidiary, ARG, which holds all of their U.S. real estate investment properties. Of our current outstanding debt to AMREFA of approximately $270k, $200k will be paid off from the sale of the large property mentioned above and the remaining amount converted into preferred shares.
This represents a great step for ProGreen, not only to substantially strengthen our balance sheet, but also as it provides an immediate income stream from the rental properties. It will also generate cash to reduce debt from the sale the large property that forms part of the portfolio.
This press release might contain information, which may constitute ‘forward-looking statements’ within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934, as amended by the Private Securities Litigation Reform Act of 1995. ‘Forward-looking statements’ are based upon expectations, estimates and projections at the time the statements are made that involve a number of risks, uncertainties and other factors that could cause actual results or events to differ materially from those anticipated.