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Security token: Publity plans digital emission

D.he office property investor Publity, whose shares are listed in the up-and-coming segment Scale, is planning to issue digital asset certificates (digital securities, security tokens) on shares in its subsidiary Preos. This is listed in the Munich market segment m: access. Security tokens represent assets or rights to assets based on blockchain technology. This is crucial in the case of the “Preos token”, as the issue of shares in the form of tokens is not yet permitted.

Security tokens make it possible to issue securities at low cost because they make a number of services, such as safekeeping, superfluous. The so-called “Preos token” from Publity is to digitally certify rights from shares in Preos Real Estate AG, the tokens should be exchangeable for regular shares. By the third quarter of 2021, shares in Preos Real Estate with a volume of up to 1 billion euros are to be securitized (“tokenized”) in this way, a first tranche of 500 million euros in the fourth quarter of 2020.

The necessary shares are to be provided from Publity’s holdings. From an economic point of view, the planned sale of the tokens in a further step is similar to a sale of the corresponding shares by Publity, which held 93.4 percent of the total of 107.5 million shares at the end of 2019. In fact, one could speak of an issue similar to subscription rights.

Publity wanted to submit the corresponding securities prospectus for the public offer to the financial supervisory authority Bafin on Monday. In addition, tokens are to be offered to selected investors as part of a private placement. Publity expects to be able to publish the prospectus in the fourth quarter of 2020.

A few years ago, Publity transformed itself from a buyer of bad debts to an issuer for real estate funds. In recent times, the Preos subsidiary has significantly expanded its own real estate portfolio. The market value of the Preos shares is currently around 1.5 billion euros. On Monday, the price of the less liquid share initially fell significantly, but then recovered. Publity seems to want to part with the Preos shares to a large extent in the future. Its CEO Thomas Olek holds 85.7 percent of Publity. At the end of July, Olek also made a purchase offer to the holders of a convertible bond due in November.

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