Clear Leisure confident despite winding-up request on subsidiary

Clear Leisure updated the market on Thursday, confirming it had been informed that the court prosecutor of Ivrea in the Metropolitan City of Turin, Italy, had filed a winding-up request on Mediapolis.

The AIM-traded company held a 74.67% majority share in the directly owned subsidiary which holds its interest in the Mediapolis property, a strategic 497,884 square metre site on the A4/A5 motorway between Milan and Turin and 10 holiday villas in Porto Cervo, Sardinia.

It said the petition arose from an initiative of the Ivrea Court following a claim which had now been settled by the company.

Under Italian law, once the request from the court has been passed to the prosecutor, the winding up petition may proceed in consideration of other outstanding debts, notwithstanding that the original debt may have already been settled.

A hearing of the court was set for 23 June, at which Mediapolis was set to provide evidence of its continuing discussion with its creditors.

Mediapolis was also required to call a shareholder meeting, scheduled for 21 June, to approve its 2016 accounts and discuss the winding-up petition and possible further financing by its shareholders.

In May, and before Mediapolis was notified of the court hearing, Clear Leisure acquired - at a discount from Mediapolis’ banks - a debt of €3.14m and the corresponding first charge mortgage on the Mediapolis site.

Clear Leisure also calculated that unpaid interest on the mortgage, currently amounting to approximately €4m, was due to it from Mediapolis.

Under the terms of the charge, the total amount that could be received by Clear Leisure following the disposal of the land was capped at €5m, and as a result, any recovery above €5m would first be assigned to other creditors which hold a second charge over the property.

Should Mediapolis be made the subject of a winding-up order, Clear Leisure said the holiday villas in Porto Cervo, Sardinia would be part of the process as they were owned by the subsidiary.

However, as the debt owed against the villas was only slightly lower than their current market value, that would have “minimal impact” on Clear Leisure’s balance sheet.

Clear Leisure’s board said it would update the market on the outcome of the 23 June hearing, once a ruling had been received.

“We are dealing with the winding-up petition, by accelerating discussions with existing creditors to achieve settlements before 23 June,” said Clear Leisure chairman and CEO Francesco Gardin.

“However, having acquired the Mediapolis €3.1m bank debt at the beginning of May 2017, with the attached first charge over the asset, we have legally ring fenced the Mediapolis site for the benefit of Clear Leisure and its shareholders.”