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Canadian Fairfax Holdings will increase its stake in Eurobank Properties from 19% to 42% with a total investment in the real estate company amounting to 164 million euro. This is the same holding company, which, a few months ago, was believed to have invested one billion euro in the National Bank of Greece. This information proved to be false, but the investment in Eurobank Properties has been confirmed.

"This act demonstrates a vote of confidence in our country," states Nikos Karamouzis, Deputy Executive Director of Eurobank. "This financial deal will reform Eurobank Properties, allowing the company to play a leading role in the privatization process of public property."

According to the information released, Eurobank Properties will initiate an increase in the share capital, giving its existing shareholders the preferential right to purchase shares. The company aims to collect about 200 million euro through the increase in capital, the price per share being 4.8 euro.

After the completion of the process, Fairfax Holdings will hold 42% of the company. Eurobank, which has so far been the main shareholder of the real estate company, will hold around 33.5%.

The terms of the deal stipulate that Eurobank and Fairfax will enter into an agreement that will allow Eurobank to maintain the control over the management of Eurobank Properties by 30 June 2020 whereas Fairfax will be able to exercise a veto. This condition will become void if, in the coming years, the share of Eurobank in Eurobank Properties falls below 20%.

"The Greeks have experienced great difficulties but we believe that now there is light at the end of the tunnel," says Prem Watsa, president and Chief Executive Officer (CEO) of Fairfax Financial Holdings. "We believe that the country has taken significant steps to address key issues in key sectors of the economy, thus encouraging foreign investment and creating positive incentives for improving the employment and the economic development of the country."

"Within this context, we have decided to strengthen our cooperation with Eurobank Properties and the parent company Eurobank, which is one of the largest financial institutions in Greece and the region," says Watsa, defining Eurobank Properties as one of the best-managed real estate companies in South-eastern Europe. "The company has a very strong real estate portfolio, stable profits, significant development opportunities and first-class staff, which is excellently managed by CEO George Chrisakos" says Watsa according to whom Chrisakos possesses a rare talent in the field of international real estate business.

Eurobank has also expressed satisfaction with the deal and Karamouzis stresses that Fairfax will cover more than 144 million euro from the 200-million increase in the capital of Eurobank Properties. The consultant of the deal is Eurobank Equities. It has to obtain all necessary regulatory approvals and complete the deal by the third quarter of 2013. Eurobank expects that the planned sale will further strengthen the capital position of the bank, which has filled the gaps in its equity capital with funds from the Greek financial stability fund.