Today, December 3, 2021, Hagar hf. and Reginn hf. signed an agreement to subscribe for new shares in the real estate development company Klasi ehf. As announced on September 24, Hagar hf., Reginn hf., Klasi ehf., and KLS eignarhaldsfélag ehf. had previously signed a letter of intent regarding the further development and operation of the real estate development company Klasi ehf.
Hagar and Reginn will each acquire a one-third stake in Klasi. Hagar will pay for its stake in Klasi with development properties that are not part of the company's core operations, while Reginn will pay with a portfolio consisting of properties for sale and development properties.
Klasi ehf. is a knowledge-based company in the field of real estate development. Since 2004, it has specialized in the development, management, and operation of real estate projects, from concept to sale, with a focus on maximizing project value. With the involvement of Hagar and Reginn, the foundation of Klasi's operations will be further strengthened. The development company will possess a portfolio containing significant opportunities, substantial financial strength, and the expertise and experience to participate in larger, long-term projects at all stages of real estate development.
"Our goal with this investment partnership in Klasi is to channel Hagar's development properties into a framework where their processing receives the undivided attention of professionals with extensive experience in real estate development. In this way, we ensure that Hagar's shareholders maximize the value of the company's development properties, while we can better focus on our own core business in the grocery and fuel markets. All parties to the partnership—Klasi, Reginn, and Hagar—are contributing valuable assets, capital, experience, and knowledge to the project. We look forward to this collaboration, which we expect will yield good returns for the owners and provide the Icelandic community with an interesting environment for the development of diverse business activities and residential housing."
"Reginn has for some time been looking for a platform to house the company's development and construction projects outside of its own group, with the involvement of specialized parties in that field as well as strong investors. With this transaction, that vision is becoming a reality. We have high hopes that this collaborative platform will be dynamic and create a new vision for the development, construction, and operation of real estate that meets the demands of future generations. We are particularly looking at the changing demands of society regarding increased sustainability in the construction, operation, and use of buildings."
"It will be a great asset for Klasi to have Hagar and Reginn join our ownership group, as they are both successful and strong companies in their respective fields. The involvement of new shareholders is also a major vote of confidence in the company and a confirmation of the success the company has achieved in the field of real estate development. It is expected that Klasi's development projects will benefit from the increased expertise gained through the new shareholders and that the company's future solutions will be even more closely aligned with the needs of the market at any given time. Various technological advances, increased awareness, requirements, and opportunities in the field of sustainability at the construction stage, in the use and operation of real estate, as well as developments in retail and business practices, create new challenges and opportunities in real estate development."
The transaction is subject to the approval of the Icelandic Competition Authority, but due diligence has now been completed.
Arctica Finance is acting as advisor to Hagar in the transaction, and Landsbankinn Corporate Finance is acting as advisor to Reginn.
