AFI Development buys remaining stake in Moscow project

AFI Development has agreed to buy out its partner for the sole ownership of the Ozerkovskaya real estate project in central Moscow.

The property development group said it would purchase the remaining 50% interest from joint venture partner Super Passion for $230m. It will also settle outstanding liabilities to its subsidiary Krown Investments.

The consideration will be paid in instalments, with the first $100m made within three business days of the agreement. The last instalment of $10m will be due by the end of 2013.

Krown Investments is a Russian subsidiary of AFI Development which currently holds the rights to the Ozerkovskaya project.

The property includes the Ozerkovskaya Phase II residential complex and the Ozerkovskaya Phase III office complex which has four separate buildings for let.

The gross asset value of the 50% interest in Ozerkovskaya II and Ozerkovskaya III, which are now both complete, is about $200m.

Mark Groysman, Executive Director of AFI Development said: "We are pleased to announce that we have reached an agreement to buy out the remaining 50% stake of our partner in Ozerkovskaya; this transaction will allow us greater flexibility in negotiations with potential buyers of this property in whole or in part."

Shares were up 9.98% to $0.65 at 14:55 Friday.

RD