Completion of a £154 million long-term, green loan

Release date:                30 September 2020

Embargoed until:           07:00 am

CLS Holdings plc ("CLS")

announces the completion of a £154 million long-term, green loan with Aviva Investors

CLS announces that it has completed a £154 million loan with Aviva Investors which is secured on a portfolio of 12 UK properties. This loan replaces three existing loans of £67 million, which were due to expire in 2020 and 2021, as well as gearing unencumbered properties and will result in net additional cash to CLS of £86 million, after costs. Subject to certain conditions, CLS will be able to remove or substitute properties as security for the loan.

Over 60% of the properties by value are offices including 166 College Road, Harrow and Twenty Kingston Road, Staines, which were acquired earlier this year, as well as the office, hotel and student accommodation at our mixed-use Spring Mews property in Vauxhall.  The offices have a WAULT of 5.2 years.

The £154 million loan, which has a loan to value of 55%, is in two tranches split equally between 10-year and 12-year tranches.  The average interest rate is 2.62% fixed.

The loan has been independently assured as a "green loan" in line with LMA sustainability principles with up to a 10-basis point margin reduction dependent on the delivery of specific sustainability targets. As noted, cash and gross debt will increase by £86 million with net debt and gearing remaining unchanged at c.35%.  Weighted average debt maturity will increase from 3.1 years as at 30 June 2020 to 4.5 years on a pro forma basis. The additional funds will increase CLS' cash reserves and allow for the evaluation of further acquisition opportunities.

Andrew Kirkman, Chief Financial Officer of CLS, commented:

"We are pleased to have secured this £154m loan with such a well-established real estate funder as Aviva Investors.  This loan increases our weighted average loan maturity by nearly 50% to 4.5 years.  Moreover, we are delighted that the loan recognises our sustainability progress and incentivises our future target delivery while aligning our sustainability commitment to that of Aviva Investors."

Gregor Bamert, Head of Real Estate Debt at Aviva Investors, commented:

"We are delighted to support CLS and the strong emphasis it places on the provision of a sustainable portfolio.  This transaction builds on our experience of incentivising borrowers to bring the green credentials of their portfolios into sharper focus and we are pleased to have received independent assurance that the facility is aligned with LMA sustainability linked loan principals.  The wide range of investment capital used within the facility further underlines our ability to tailor debt solutions for borrowers whilst delivering strong opportunities for our investor clients."

-ends-

For further information, please contact:

CLS Holdings plc

(LEI: 213800A357TKB2TD9U78)

www.clsholdings.com

Fredrik Widlund, Chief Executive Officer

Andrew Kirkman, Chief Financial Officer

+44 (0)20 7582 7766

Liberum Capital Limited

Richard Crawley

Jamie Richards

+44 (0)20 3100 2222

Panmure Gordon

Hugh Rich

+44 (0)20 7886 2733

Elm Square Advisers Limited

Jonathan Gray

+44 (0)20 7823 3695

Smithfield Consultants (Financial PR)
Alex Simmons

Rob Yates

+44 (0)20 3047 2546