informs on the final report of the thorough examination by KPMG Forensic
Adler Group NV / Keyword(s): Declaration/Miscellaneous
Adler Group SA: informs on the final report of the comprehensive review by KPMG Forensic
21-Apr-2022 / 23:49 CET/CEST
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Adler Group advises on final report of comprehensive review by KPMG Forensic
Grand Duchy of Luxembourg, April 21 2022: ADLER Group SA (“ADLER” or the “Company”) announces that KPMG Forensic has provided the Company with the final report of its comprehensive review of Viceroy Research LLC’s allegations. This report will be published on the company’s website on April 22, 2022.
KPMG Forensic found no evidence that there were any systematic fraudulent and plundering transactions with allegedly related parties. However, KPMG Forensic has identified deficiencies in the documentation and processing of these transactions.
Regarding the so-called Gerresheim transaction with an allegedly related party, the allegation that the project company’s sale price was excessive cannot be refuted by KPMG Forensic. According to KPMG Forensic, it is doubtful that the valuation of €375 million on which the transaction is based represents a fair value of the same amount under IFRS 13. That said, the Company continues to believe that the fair value of the project company agreed to in the transaction, as reflected and evidenced in various audited financial statements, is correct.
The allegation that the LtV calculation methodology used by the Company was changed in order to avoid breaches of the terms of the relevant obligations has been refuted by KPMG Forensic. However, in the opinion of KPMG Forensic, the methodology for calculating the loan-to-value (“LtV”) ratio derived by the Company and its subsidiary Adler Real Estate AG from the terms of the bonds does not fully comply with the textual requirements of the terms respective obligations. As part of the review, KPMG Forensic performed an LtV calculation through the end of the quarters of the years 2019 and 2020 based on their differing understanding of bond terms. Using the financial positions to be included in KPMG Forensic’s opinion, but without taking into account the derivative accounting corrections deemed necessary by KPMG Forensic, no LtV threshold specified in the terms of the obligation was exceeded.
Taking into account the accounting corrections deemed necessary by KPMG Forensic of the fair value of the Gerresheim transaction, the LtV threshold of 60% was exceeded once by Adler Real Estate AG, but not by the Company, on the closing date of 30 September 2019.
Grand Duchy of Luxembourg, April 21, 2022
ADLER Group SA
board of directors
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