Sponda - Company Announcement

Sponda Plc purchases the Fennia Quarter, Sponda Plc's Board of Directors decides on a directed share issue to the seller

Sponda Plc  Stock exchange release            29 April 2011 at 12.30



SPONDA PLC PURCHASES THE FENNIA QUARTER FROM SUOMI MUTUAL LIFE ASSURANCE
COMPANY. SPONDA PLC'S BOARD OF DIRECTORS DECIDES ON A DIRECTED SHARE ISSUE TO
THE SELLER. 



With a sale and purchase agreement signed today, Sponda Plc ('Sponda') will
purchase from Suomi Mutual Life Assurance Company ('Suomi Mutual') the Fennia
Quarter located in the Helsinki Central Business District and consisting of all
the shares in six real estate companies and a portion of the shares in a
company managing the Kaisaniemi metro hall. The Fennia Quarter has a total of
approximately 25,500 m2 of office space and approximately 14,200 m2 of business
premises. On the date of closing, the vacancy rate of this entity was
approximately 9.7 per cent. The net initial yield of the object is
approximately 5.7 per cent. 

Sponda will pay to Suomi Mutual for the entity a total of EUR 122,000,000 as
debt-free purchase price, of which EUR 100,000,000 less the net debt of the
target has been paid in cash in connection with the signing of the purchase. In
addition to the cash payment, Sponda's Board of Directors has decided to pay a
part of the purchase price through an issue of 5,500,000 new shares in Sponda
directed to Suomi Mutual based on the share issue authorization given by
Sponda's Annual General Meeting of Shareholders on 16 March 2011. 

Grounds for the Purchase

One of Sponda's key strengths is its property portfolio that is concentrated in
the best locations in the Helsinki Metropolitan Area. The purchase of the
Fennia Quarter supports Sponda's strategy and strengthens the property
portfolio of Sponda's Investment Properties business unit. The major tenants in
the entity are Finland's Slot Machine Association, Finnkino and the City of
Helsinki. The concluded purchase will have a positive impact on Sponda's net
assets per share and cash flow per share already in 2011. The Company has
estimated that Finland's property market will see a positive turn during the
ongoing year, and the anticipated rise in rents in the central Helsinki area in
particular will have a positive impact on the profitability of the Fennia
Quarter in the future. 

The title to the Fennia Quarter passed to Sponda in connection with signing the
sale and purchase agreement, and the entity will increase Sponda's rental
income from the beginning of May 2011. The purchase was concluded on normal
market terms. 

Directed Issue

In addition to the cash payment, Sponda's Board of Directors decided to issue
5,500,000 new shares in Sponda to Suomi Mutual through a directed issue based
on the share issue authorization given by Sponda's Annual General Meeting of
Shareholders on 16 March 2011. The share issue will be carried out against a
contribution in kind. Suomi Mutual subscribed for all the shares at a
subscription price of four euros (EUR 4.00) per share. This is the closing
price of the share as at 29 March 2011 and exceeds the equity per share
adjusted by dividends as at 31 December 2010 as well as the average price of
Sponda's shares adjusted by dividends in February 2011. Thus, the total value
of the share consideration was EUR 22,000,000. Sponda's Board of Directors
believes that the subscription price per share determined in connection with
the purchase is justified as part of the totality of the purchase of the Fennia
Quarter. 

On the aforementioned grounds, Sponda's Board of Directors finds that there is
a weighty financial reason for carrying out the share issue in deviation from
the shareholders' pre-emptive rights in connection with the purchase of the
Fennia Quarter. 

Sponda's Board of Directors has received an opinion on the value of the Fennia
Quarter from Advium Corporate Finance Ltd, who acted as Sponda's financial
advisor in the transaction. According to Advium Corporate Finance Ltd's
opinion, the purchase price of the Fennia Quarter on the aggregate corresponds
to the fair value of the entity and is financially reasonable. 

The shares issued to Suomi Mutual will entitle their holder to shareholder's
rights after the shares have been registered in the Finnish Trade Register and
in Sponda's shareholders' register, on or about 5 May 2011. Sponda will file an
application to NASDAQ OMX Helsinki Ltd for the admission of the new shares to
public trading. The shares will be incorporated in the book-entry system and
will become subject to public trading on the official list of NASDAQ OMX
Helsinki Ltd on or about 6 May 2011. On 20 April 2011, the Finnish Financial
Supervisory Authority granted to Sponda an exemption from the duty to publish a
prospectus related to the listing of new shares. 

The new shares to be issued to Suomi Mutual will represent approximately 1.94
per cent of all Sponda's shares after the directed issue has been registered.
After the registration, Sponda will have a total of 283,075,462 shares. The
subscription price of the new shares will be credited to the invested
unrestricted equity reserve and Sponda's share capital will remain unchanged at
EUR 111,030,185. 



Helsinki, 29 April 2011



Sponda Plc



For additional information, please contact:

Kari Inkinen, President and CEO, tel. +358 400 402 653;

Erik Hjelt, CFO, tel. +358 400 472 313; and

Pia Arrhenius, Senior Vice President, Corporate Communications and IR, tel.
+358 40 527 4462 





THIS RELEASE IS NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR
INDIRECTLY, EITHER IN FULL OR PARTIALLY, IN OR INTO THE UNITED KINGDOM, UNITED
STATES, CANADA, AUSTRALIA, HONG KONG, SINGAPORE OR JAPAN OR ANY OTHER
JURISDICTION IN WHICH THE SAME WOULD BE UNLAWFUL. THIS RELEASE IS NOT A DIRECT
OR INDIRECT OFFER OF SECURITIES IN THE UNITED KINGDOM, UNITED STATES, CANADA,
AUSTRALIA, HONG KONG, SINGAPORE OR JAPAN OR ANY OTHER JURISDICTION IN WHICH THE
SAME WOULD BE UNLAWFUL OR WOULD REQUIRE PROSPECTUS, ANY RELATED REGISTRATION OR
ANY OTHER ACTIONS ACCORDING TO APPLICABLE RULES OF THAT JURISDICTION.
SECURITIES MAY NOT BE SOLD IN THE UNITED STATES ABSENT REGISTRATION WITH THE
UNITED STATES SECURITIES AND EXCHANGE COMMISSION OR AN EXEMPTION FROM
REGISTRATION UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED. THE COMPANY HAS
NOT REGISTERED, AND DOES NOT INTEND TO REGISTER ANY PART OF THE OFFERING IN THE
UNITED STATES OR TO CONDUCT A PUBLIC OFFERING OF SECURITIES IN THE UNITED
STATES. 



ANNEX: TERMS AND CONDITIONS OF THE SHARE ISSUE



The Annual General Meeting of Sponda Plc (the 'Company' or 'Sponda') authorized
on 16 March 2011 the Company's Board of Directors to decide on the issue of a
maximum of 27,757,000 new shares. The share issue may be carried out by
offering new shares or by transferring treasury shares. Based on this
authorization, the Board of Directors is authorized to decide on a directed
share issue in deviation from the shareholders' pre-emptive rights and on the
granting of special rights subject to the conditions mentioned in the Companies
Act. The Board of Directors can act on this authorization in one or several
tranches. The Board of Directors can use the authorization to finance or carry
out corporate acquisitions or other restructuring, to strengthen the Company's
capital structure, or for other purposes decided by the Board of Directors. The
authorization may not, however, be used for the implementation of incentive
schemes for the Company's management or key personnel. The Board of Directors
is authorized to decide on other conditions of the share issue and issuance of
special rights. The authorization is in force until the next Annual General
Meeting. 

Based on the authorization granted by the Annual General Meeting, the Company's
Board of Directors has decided on 29 April 2011 on the issue (the 'Share
Issue') of a total of 5,500,000 new shares in the Company (the 'New Shares') in
accordance with these terms and conditions of the Share Issue to Suomi Mutual
Life Assurance Company (the 'Company Entitled for Subscription'). The New
Shares form a part of the purchase price to be paid to the Company Entitled for
Subscription for the so-called Fennia Quarter in accordance with the sale and
purchase agreement (the 'Sale and Purchase Agreement') signed on 29 April 2011
between the Company and the Company Entitled for Subscription. 

As a result of the Share Issue, the total number of shares in the Company will
increase from 277,575,462 shares to 283,075,462 shares. The New Shares will
represent 1.98 per cent of Sponda's existing shares and the related voting
rights before the Share Issue and 1.94 per cent of the existing shares and the
New Shares and the related voting rights after the Share Issue. 

1. Subscription Right

The New Shares will be offered, in deviation from the shareholders' pre-emptive
right set forth in Chapter 9(3) of the Companies Act, for subscription by the
Company Entitled for Subscription. 

The shares to be issued form a part of the purchase price to be paid to the
Company Entitled for Subscription for the so-called Fennia Quarter. The
purchase of the Fennia Quarter supports Sponda's strategy and strengthens the
property portfolio of Sponda's Investment Properties business unit. Sponda's
Board of Directors finds that there is a weighty financial reason for carrying
out the Share Issue in deviation from the shareholders' pre-emptive rights in
connection with the purchase of the Fennia Quarter. 

2. Subscription Price

 The subscription price of the New Shares is EUR 4.00 per share (or a total of
EUR 22,000,000 for the New Shares) (the 'Subscription Price'), which will be
credited in full to the invested unrestricted equity reserve of the Company.
The Subscription Price corresponds to the closing price of the share as at 29
March 2011 and exceeds the equity per share adjusted by dividends as at 31
December 2010 as well as the average share price adjusted by dividends in
February 2011. The subscription price per share determined in connection with
the purchase is justified as part of the totality of the purchase of the Fennia
Quarter. 

3. Subscription Period

In the Sale and Purchase Agreement, the Company Entitled for Subscription has
in advance and irrevocably declared that it will subscribe for the New Shares,
and the Company's Board of Directors has undertaken to accept these
subscriptions in the Sale and Purchase Agreement. The Subscription Period ends
when the meeting of the Board of Directors is closed on 29 April 2011. 

4. Subscribing and Paying the Shares

The Company Entitled for Subscription will subscribe for the New Shares through
a separate subscription list. 

The Subscription Price of the New Shares will be paid as contribution in kind
by transferring the contribution in kind to the Company on 29 April 2011 in
accordance with the terms and conditions of the Sale and Purchase Agreement.
The contribution in kind consists of the following shares: 

i.       Kiinteistö Oy Mikonkatu 19: shares No 1-7,356

ii.      Kiinteistö Oy Mikonkatu 17: shares No 1-15,000

iii.     Oy Mikonlinna Ab: shares No 1-10,000

iv.     Kiinteistö Oy Kaisaniemenkatu 2 B: shares No 1-38,228

v.      Kiinteistö Oy Paulon Talo: shares No 1-36,677

vi.     Kiinteistö Oy Helsingin Vuorikatu 14: shares No 1-72,600

vii.    Kiinteistö Oy Kaisaniemen Metrohalli: shares No 12,251 - 13,271 and
13,655 - 15,450. 



5. Registration of Shares to a Book-entry Account and Trading

The Company will file an application to NASDAQ OMX Helsinki Ltd for the
admission of the New Shares to public trading. The shares will be incorporated
in the book-entry system and will become subject to public trading on the
official list of NASDAQ OMX Helsinki Ltd on or about 6 May 2011. 

6. Shareholders' Rights

The Offer Shares will carry the right to dividends distributed by the Company
and the right to other distribution of funds as well as other shareholder
rights in the Company once the New Shares have been registered with the Trade
Register, on or about 5 May 2011. The New Shares will rank pari passu with all
shares in Sponda. Each New Share entitles its holder to one vote at the General
Meeting of Shareholders of the Company. 

7. Finnish Transfer Tax

No transfer tax is payable on the subscription for the New Shares.

8. Governing Law

The Share Issue shall be governed by the laws of Finland.

9. Other Matters

The Company's Board of Directors will decide on other circumstances and
practical measures related to the Share Issue, if necessary.