Notice of EGM

RNS Number:4771D
Albemarle Property Investments PLC
11 May 2001

              ALBEMARLE PROPERTY INVESTMENTS PLC ("THE COMPANY")



  PROPOSAL FOR THE EARLY REDEMPTION OF THE #35,000,000 10.25 PER CENT. FIRST
                 MORTGAGE DEBENTURE STOCK 2012 0F THE COMPANY



Introduction

The Company today announces that it is putting forward a proposal to holders
of #35,000,000 10.25 per cent. First Mortgage Debenture Stock 2012 ("Stock")
to amend the conditions of the Stock in order to permit the Company to redeem
the Stock earlier than 1 June 2012 ("Proposal").

A circular setting out the Proposal, the reasons for it and to convene a
meeting of the holders of Stock ("Stockholders") is today being sent to
Stockholders.

Background to the Proposal

The Stock was created by a trust deed and secured #15,000,000 of debt at an
interest rate of 10.25 per cent. The original trust deed was varied by the
first supplemental trust deed and secured the issue of a further #20,000,000
of debt. The security for the Stock comprised investment properties valued at
#61,250,000.

In the early 1990s, the Company became unable to service its debts and,
following discussions with its principal bankers, sought to restructure its
finances.

On 23 December 1993, the third supplemental trust deed was executed which
reduced the capital cover ratio to 120 per cent. until 13 December 1997. The
Company however remained in breach of its financial covenants between 1993 and
1997.

On 2 April 1998, the fourth supplemental trust deed was executed and the
Company attempted to undertake a staged recovery programme of the capital
cover ratio on the following basis:

31 December 1998                                127.0 per cent.

31 December 1999                                135.7 per cent.

31 December 2000                                142.9 per cent.

31 December 2001                                150.0 per cent.

After 31 December 2001                       150.0 per cent.

On 23 November 1998, the Company changed its name to Albemarle Property
Investments PLC.

In 1999 the Company's shareholders accepted an all-share offer from Orb
Estates Plc ("Orb"), a then listed property company. Orb has since undergone
significant management change, having been acquired by Jersey based venture
capital group Lynch Talbot Limited.



After reviewing the properties and management strategy of the Company's
portfolio, the new management of Orb decided to pursue a policy of remedying
the breaches of the Stock's financial covenants.

To achieve this result, Orb has invested over #8 million in the Stock
portfolio by way of cash and asset transfers, moving the underlying security
value for the Stock from approximately #44.45 million on the date of
acquisition to today's value of #53.84 million.

As a result of the investment by Orb in the Stockholders' security, the
Company is now able to ensure that Stockholders will receive all of their
capital and accrued interest together with a premium for redemption if the
Proposal is accepted.

The Proposal

The Company has today convened a meeting of Stockholders to consider and, if
thought fit, pass the extraordinary resolution described below.



The extraordinary resolution provides for the Company to redeem the Stock at a
price of #112 per #100 of nominal amount of Stock.  Stockholders will be
entitled to be paid all accrued interest on the Stock up to and including the
early redemption date, subject to any deduction of tax required by law.

The modifications to the conditions of the Stock in order to give effect to
the Proposal are set out in full in the circular being sent to Stockholders
today.  It is proposed that these modifications will become effective,
assuming that the extraordinary resolution is validly passed, when the Law
Debenture Corporation plc ("Trustee") enters into a supplemental trust deed.

The effect of the passing of the extraordinary resolution will be to approve
the Proposal and authorise and instruct the Trustee to concur with the Company
in executing a supplemental trust deed to give effect to it immediately
following the meeting of Stockholders. The Company will exercise its power to
redeem the Stock early two business days after the execution of the
Supplemental Trust Deed.

After redemption the Stock will be cancelled and will not be reissued or
resold.

A special committee of Stockholders (representing approximately 71 per cent.
of the Stock) composed principally of members of the Association of British
Insurers has examined the Proposal and finds it acceptable.

The Company has been advised by Corporate Synergy PLC that the Proposal is
fair and reasonable.



None of the Directors, nor any person deemed to be connected to them has any
interest in the Stock.



Reasons for the Proposal

The Company has been in breach of its underlying covenants for 10 of its 14
years. There have been times during this period when the Stockholders' capital
would not have been redeemed in full if the Stock's underlying security had
been liquidated.

The current environment of lower interest rates and the Company's current
management expertise provides the opportunity for the Stock to be redeemed at
a significant premium to its issue price. The early redemption price has been
calculated to give the Stockholders a significant premium, while recognizing
that without the support of Orb, the Company would not be able to achieve this
or, in fact, even have complied with the covenants as required by the fourth
supplemental trust deed.

Financing the redemption of the Stock

The Company will finance the redemption of the Stock by way of a #40,442,500
facility provided by Morgan Stanley Dean Witter Bank Limited.

Trustee

In accordance with its normal practice, the Trustee expresses no opinion as to
the merits of the Proposal, the terms of which were not negotiated by it. It
has, however, authorised it to be stated that, on the basis of the information
contained in the circular being sent to Stockholders today, which it advises
Stockholders to read carefully, it has no objection to the extraordinary
resolution being submitted to Stockholders for their consideration.



Expected timetable



Record date - register of Stockholders to be closed
                      30 May 2001



Latest time and date for deposit of payment instructions

for electronic funds transfer
               11.00 am on 2 June 2001



Latest time and date for receipt of Forms of Proxy
    11.00 am on 2 June 2001



Extraordinary meeting of Stockholders
        11.00 am on 4 June 2001



Date for execution of the Supplemental Trust Deed
                     4 June 2001



Payment of Early Redemption Price
                           6 June 2001



Note: This timetable assumes that Stockholders vote in favour of the
Extraordinary Resolution at the meeting on 4 June 2001.





Further Information



Further information concerning the Proposal is set out in a circular being
sent to Stockholders today.