FOUNTAINHEAD PROPERTY TRUST - Potential acquisition by Redefine of the Fountainhead property portfolio and renewal of the Fountainhead cautionary

Potential acquisition by Redefine of the Fountainhead property portfolio and renewal of the Fountainhead cautionary

REDEFINE PROPERTIES LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1999/018591/06)
JSE share code: RDF ISIN: ZAE000143178
(Approved as a REIT by the JSE)
(“Redefine”)

FOUNTAINHEAD PROPERTY TRUST
(A collective investment scheme in property
registered in terms of the Collective Investment
Schemes Control Act, No. 45 of 2002)
(“Fountainhead”)
Managed by Fountainhead Property Trust Management Limited
(Registration number 1983/003324/06)
(“FPTML”)
JSE share code: FPT ISIN: ZAE000097416
(Approved as a REIT by the JSE)


POTENTIAL ACQUISITION BY REDEFINE OF THE FOUNTAINHEAD PROPERTY PORTFOLIO AND RENEWAL OF THE FOUNTAINHEAD CAUTIONARY ANNOUNCEMENT


1.    Introduction and background

      1.1.    In July 2014 Fountainhead unitholders were advised that Redefine, Fountainhead and FPTML had
              reached agreement in terms of which Fountainhead would dispose of all of its assets in exchange for 82
              new Redefine shares for every 100 Fountainhead units in issue and the assumption by Redefine of all of
              Fountainhead’s liabilities (the “previous transaction”).

      1.2.    The previous transaction was subject to, amongst other things, the approval of 75% of the Fountainhead
              unitholders present (or represented by proxy) and voting at a meeting of Fountainhead unitholders
              called to approve the previous transaction (the “voting Fountainhead unitholders”). As announced
              on 22 August 2014, the resolution to approve the previous transaction was supported by more than 71%
              of the voting Fountainhead unitholders but not the 75% required to pass the proposed resolution. The
              failure to achieve the required majority was a result of the previous transaction not enjoying the support
              of certain of Fountainhead’s institutional unitholders.


2.    Potential revised transaction

      2.1.    Following an approach from the largest of the institutional unitholders that did not support the previous
              transaction, Redefine has reached agreement with them in terms of which they have irrevocably
              undertaken to vote in favour of the acquisition by Redefine of all of Fountainhead’s assets in exchange
              for 85 new Redefine shares for every 100 Fountainhead units in issue and the assumption of all of
              Fountainhead’s liabilities (the “revised proposal”).

      2.2.    Redefine has canvassed other significant Fountainhead unitholders and has now obtained irrevocable
              undertakings to support the revised proposal from Catalyst Fund Managers SA Proprietary Limited,
              Old Mutual Investment Group Proprietary Limited, Absa Asset Management Proprietary Limited, the
              Eskom Pension and Provident Fund and Nedgroup Investment Advisors, which unitholders collectively
              hold 135 235 402 Fountainhead units (representing 34.11% of the votes capable of voting on the
              resolution to approve the revised proposal). Redefine has also obtained non-binding indications of
              support from Fountainhead unitholders that (based on the latest available register) hold a further 56 857
              190 Fountainhead units (or 14.34% of the votes capable of voting on the resolution to approve the
               revised proposal). Significantly, the irrevocable undertakings include undertakings from all of the
               major institutional Fountainhead unitholders that had declined to support the previous transaction and
               no unitholder has indicated opposition to the revised proposal.


3.    The way forward and renewal of cautionary

      3.1.     FPTML will appoint an independent committee of its board of directors to consider the revised
               proposal and engage with Redefine in relation thereto.

      3.2.     If the transaction proceeds, to the maximum extent possible the parties will seek to leverage off the
               agreements and documents prepared for the previous transaction and the parties will jointly engage
               with the Fountainhead trustee and the Registrar of Collective Investment Schemes in relation to the
               revised proposal.

      3.3.     Fountainhead unitholders are advised to continue exercising caution when trading in Fountainhead
               units until a further announcement is made.


27 March 2015



Corporate advisor and sponsor to Redefine
Sponsor to Fountainhead
Java Capital


Legal advisor to Redefine
Cliffe Dekker Hofmeyr


Legal advisor to the FPTML independent committee
BG Bowman Gilfillan

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