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Announcement Regarding the Acquisition of Three Properties
ORION REAL ESTATE LIMITED
(Incorporated in the Republic of South Africa)
(Registration number: 1997/021085/06)
Share Code: ORE ISIN: ZAE000075651
("Orion Real Estate" or “the company”)
ANNOUNCEMENT REGARDING THE ACQUISITION OF THREE PROPERTIES
BACKGROUND
Shareholders are advised of the acquisition of three properties, namely Stand 62 Welkom
Ext 11 and Portions 9 & 10 of Stand 9866 Welkom Ext 31, Free State (“Stands 62 and Stand
9866”), Stand 5876 Secunda Ext 11 (“Stand 5876”) and Stand 13418 and Portion 2 of Stand
809 Bloemfontein, Free State (“Stand 13418 and Stand 809”) (together the “Acquisitions”) as
a going concern by Orion Real Estate (“the Purchaser”) from the Michael Family Trust (“the
Seller”). The Michael Family Trust is the family trust of Mr Michael Georgiou. The Seller is not a
related party to Orion Real Estate. The effective date of the Acquisitions will be the date of
transfer of the respective properties into the name of the Purchaser.
RATIONALE FOR THE ACQUISITIONS
Orion Real Estate continually evaluates its property portfolio and seeks to maximise its return
to its shareholders. These Acquisitions are in line with this strategy.
STANDS 62 AND STAND 9866 - TERMS OF THE ACQUISITION
Purchase Price
The total consideration for the Acquisition of the properties is R7 000 000 exclusive of VAT at
0%, of which R1 400 000 will be payable in cash with the balance of R5 600 000 through the
issue of 5 915 285 Orion shares at R0.9467 (94.67 cents) per share.
If VAT becomes payable at a rate other than 0%, the agreement will immediately be
cancelled without a claim against the other party.
The cash price shall be paid against registration of transfer of the Property into the name of
the Purchaser. This will be secured by way of a guarantee/s.
The Subscription Price will be paid with effect on the Transfer Date.
Description of Property
The property is Stand 62 Welkom Ext 11 and Portions 9 & 10 of Stand 9866 Welkom Ext 31, Free
State and is known as the DME Offices. The property is a commercial property.
Property specific information is detailed below:
PROPERTY NAME ADDRESS LOCATION SECTOR
DME offices Stand 62 Welkom Ext 11 Welkom Ext 31 Commercial
and Portions 9 & 10 of Free State
Stand 9866
PROPERTY
VALUATION
WEIGHTED AVERAGE DATED
RENTABLE AREA NET RENTAL PER M2 TENANT PROFILE APRIL 2017
3499m2 R29.46 - ICALC Training R11 000 000
Academy
- Van Lingen IngelyF
(Inc)
- Lesedi House Funerals
STAND 5876 - TERMS OF THE ACQUISITION
Purchase Price
The total consideration for the Acquisition of the property is R22 400 000 exclusive of VAT at
0%, of which R4 480 000 will be payable in cash with the balance of R17 920 000 through the
issue of 18 928 911 Orion shares at R0.9467 (94.67 cents) per share.
If VAT becomes payable at a rate other than 0%, the agreement will immediately be
cancelled without a claim against the other party.
The cash price shall be paid against registration of transfer of the Property into the name of
the Purchaser. This will be secured by way of a guarantee/s.
The Subscription Price will be paid with effect on the Transfer Date.
Description of Property
The property is Stand 5876 Secunda Ext 11 and is known as PQ Clothing Secunda.
PROPERTY NAME ADDRESS LOCATION SECTOR
PQ Clothing Stand 5876 Secunda Secunda Commercial
Ext 11
PROPERTY
VALUATION
WEIGHTED AVERAGE DATED
RENTABLE AREA NET RENTAL PER M2 TENANT PROFILE APRIL 2017
3594m2 R46.83 - PQ Clothing R23 800 000
- Truworths
STAND 13418 AND STAND 809 - TERMS OF THE ACQUISITION
Purchase Price
The total consideration for the Acquisition of the property is R43 000 000 exclusive of VAT at
0%, of which R8 600 000 will be payable in cash with the balance of R34 400 000 through the
issue of 36 336 749 Orion shares at R0.9467 (94.67 cents) per share.
If VAT becomes payable at a rate other than 0%, the agreement will immediately be
cancelled without a claim against the other party.
The cash price shall be paid against registration of transfer of the Property into the name of
the Purchaser. This will be secured by way of a guarantee/s.
The Subscription Price will be paid with effect on the Transfer Date.
Description of Property
The property is Stand 13418 and Portion 2 of Stand 809 Bloemfontein, Free State and is known
as CCMA Bloemfontein.
PROPERTY NAME ADDRESS LOCATION SECTOR
CCMA Stand 13418 and Bloemfontein Commercial
Portion 2 of Stand 809
PROPERTY
VALUATION
WEIGHTED AVERAGE DATED
RENTABLE AREA NET RENTAL PER M2 TENANT PROFILE APRIL 2017
6224m2 R51.87 - CCMA R43 600 000
- Standard Bank
- Tekkie Town
- Beares Furnishers
CONDITIONS PRECEDENT AND DOCUMENTATION FOR THE ACQUISITIONS
The Acquisition is subject to a number of conditions precedent, including inter alia, the
following:
- The procurement by the Purchaser of a loan in the amount equal to the cash price by no
later than 12 April 2018;
- The Purchaser conducts a due diligence investigation regarding the condition or quality
of the Leases by no later than 23 March 2018;
- The Seller conducts a due diligence investigation in respect of the Purchaser by no later
than 23 March 2018;
- To the extent necessary, the Purchaser obtaining approval for the purchase of the
Property as contemplated in terms of the Competition Act, No 89 or 1998, if necessary;
- To the extent necessary, JSE approval is obtained by no later than 15 April 2018;
- To the extent necessary, all regulatory approvals are obtained within 120 days from
procurement of the loan;
- Approval of the purchase of the Property by the Board of Directors of the Purchaser by
no later than 31 March 2018; and
- Approval of the sale of the Property by the Board of Directors and shareholders, if
necessary, of the Seller by no later than 31 March 2018.
CLASSIFICATION OF THE TRANSACTIONS
The Acquisitions are classified as a Category 2 transaction, and thus will not require
shareholder approval.
FINANCIAL INFORMATION
The purchase consideration for the Acquisitions, totalling R72.4 million is considered to be
approximate valuation of the properties acquired.
The net rental received on the properties amounts to R595 263 per month, excluding VAT.
Transaction fees of not more than 4% of the purchase consideration will be payable on the
fulfilment of the Conditions Precedent.
No material additional costs are expected to be incurred.
WARRANTIES
The normal warranties are in place for acquisitions of this nature.
By order of the Board
20 March 2018
Sponsor
Arbor Capital Sponsors Proprietary Limited
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