Supernova’s Acquisition of Shopping Centres in Slovenia

Šelih & Partnerji advised Supernova on its EUR 220 million acquisition of seven shopping malls and five smaller shopping centres from Centrice Real Estate GmbH, a member of America’s Lone Star fund. The sellers were advised by Rojs, Peljhan, Prelesnik & Partnerji, including Partner Sergej Omladic and Senior Associate Rok Kokalj.

Šelih & Partnerji’s team was led by Partner Blaz Ogorevc, assisted by Senior Associate Miha Stravs.

Lawyer Monthly spoke to the team at Šelih & Partnerji

As legal adviser to Supernova, can you share the objectives you had achieved, and the challenges you overcame in order to do so?

Real estate and construction have always been one of the core practices of Šelih & Partnerji, but in recent years, the firm has especially established prominence in its involvement in large retail property transactions. Advising either the sellers, buyers or the financing parties, we have been involved in transactions which have included over 50% of all the larger shopping and retail centres in Slovenia.

We first reviewed the portfolio that was the subject of the present transaction in 2011 as part of the internal reorganisation, then in 2013, we advised on the corporate and asset restructuring of the same. Again, in 2015, we advised on the sell-side when 23 Slovenian properties were sold.

While most of the large real estate transactions in the past years were more or less distressed or restructuring deals, this was a more “normal” market deal and this reflects also the situation in the Slovenian M&A market in general.

In this transaction, we advised the buyer in an acquisition of the major part of the same portfolio. While in the first few of the aforementioned cases we partnered with some of the most prominent regional law firms, in the last deal we were involved in, we were engaged directly by the foreign investor for this portfolio. This shows that we are trusted also by major foreign market players and are recognised to have the experience and the capacity to work on the largest deals in Slovenia and in the region.

In addition, we consider Supernova to be one of our most important clients with whom we share business values and work ethics, which makes working with them a valuable experience. They are certainly one of the clients who we have desired to work for, for some time. We have gotten to know the client’s team in some of our previous deals (when we were working on the opposing side) and we were very happy when they also recognised the potential for a longstanding trusted relationship.

Why is this a good deal for all involved?

The deal was demanding for its size and complexity of financing, however, it was closed smoothly due to the well-structured escrow mechanism and due to good cooperation of all parties involved. In term of substance, the deal represents the final exit of a financial investor and affirmation of Supernova’s strategic and long-term presence on the market.

How does this transaction represent the current M&A climate in Slovenia?

While most of the large real estate transactions in the past years were more or less distressed or restructuring deals, this was a more “normal” market deal and this reflects also the situation in the Slovenian M&A market in general.