GROWTHPOINT PROPERTIES LIMITED - Announcement regarding the subscription by Growthpoint for an initial 26.88% stake in Globalworth

Announcement regarding the subscription by Growthpoint for an initial 26.88% stake in Globalworth

 Growthpoint Properties Limited
 Approved as a REIT by the JSE
 (Incorporated in the Republic of South Africa)
 (Registration number 1987/004988/06)
 Share code: GRT ISIN ZAE000179420
 (“Growthpoint” or the “Company”)


 ANNOUNCEMENT REGARDING THE SUBSCRIPTION BY GROWTHPOINT FOR AN INITIAL 26.88%
 STAKE IN GLOBALWORTH REAL ESTATE INVESTMENTS LIMITED


1. Introduction

   Growthpoint is pleased to announce that it has concluded an agreement to subscribe for an initial
   c. 26.88% stake in London Alternative Investment Market (“AIM”) listed Globalworth Real Estate
   Investments Limited (“Globalworth”), Romania’s leading office investor and developer, for a total
   consideration of €186.4 million (the “Subscription”). Globalworth has agreed to issue Growthpoint 23.3
   million subscription shares and 1 million fully-paid up fee shares, giving Growthpoint an initial stake of
   24.3 million Globalworth shares (c. 26.88%). A further 1 million fully-paid up fee shares will be issued to
   Growthpoint by 31 December 2017, thereby increasing Growthpoint’s stake in the enlarged share capital
   of Globalworth to 25.3 million Globalworth shares (c. 27.66%).

2. Overview of Globalworth

   Founded in 2013, Globalworth is a real estate investment company active in Central and Southeast Europe
   with a primary focus on Romania. Globalworth’s portfolio currently comprises 15 high quality real estate
   investments currently valued at c. €962.4m, all of which are located in Romania. The portfolio comprises
   a mix of modern “A-grade” office properties, an industrial park, a residential complex, developments
   under construction and land parcels for future development. Globalworth has a focused investment
   strategy of building a diversified portfolio of properties in the broader Central and Southeast Europe
   regions, underpinned by sound local and multinational tenants and Euro-denominated leases.

   Led by chief executive officer and founder Ioannis Papalekas, who has deep local knowledge and over 15
   years’ experience in all aspects of property development, investment, leasing and asset management in
   Romania, Globalworth is internally managed by a team of c. 70 professionals based in Bucharest. Following
   the initial Subscription, Mr Papalekas will continue to own c. 25.72% of the enlarged share capital of
   Globalworth.

3. Rationale for the Subscription

   Pursuant to its international strategy, Growthpoint continues to seek accretive acquisition opportunities
   alongside local, highly experienced management teams. The Subscription allows Growthpoint to invest in
   an established, high-quality real estate company active in the Central and Southeast Europe regions which
   are expected to benefit from the growing demand for office and industrial real estate, on the back of
   strong gross domestic product growth as well as the rapid expansion of a young, skilled working population.

   The investment by Growthpoint facilitates the completion of Globalworth’s development projects and
   further unlocks potential new pipeline acquisition opportunities, initially in Romania and thereafter across
   the broader Central and Southeast Europe regions. Furthermore, as an anchor investor committed to the
   long term growth of Globalworth, Growthpoint introduces access to new sources of funding for
   Globalworth, as well as access to Growthpoint’s institutional knowledge base through its representation
   on the Globalworth board of directors and investment committee. The investment also provides
   Globalworth an increased ability to raise funds from international debt capital markets at an attractive
   cost.

   Growthpoint expects the transaction to be accretive to distributions.

4. Conditions precedent and effective date of the Subscription

   The Subscription is subject to, inter alia, the following conditions precedent:


   -   receipt of exchange control approval from the South African Reserve Bank; and


   -   Globalworth’s shareholders approving the resolutions necessary to approve the Subscription and the
       admission to listing of the subscription shares to the AIM.

   The effective date of the Subscription is anticipated to occur before the end of December 2016.

5. Categorisation of the Subscription

   The Subscription and respective value ratios fall outside the categorisation criteria of the JSE Listings
   Requirements. This announcement is therefore issued on the basis that the Subscription may impact
   Growthpoint’s share price.

6. Further information on Globalworth and the Subscription

   For further information on Globalworth and to view a copy of Globalworth’s shareholder circular and
   notice of extraordinary meeting in relation to the Subscription, please visit its website:
   www.globalworth.com.

   This announcement and any forward-looking statements have not been reviewed by the Company’s
   auditors.

   Sandton
   1 December 2016

Corporate Advisor and Sponsor to Growthpoint
Investec Bank Limited


Legal advisors to Growthpoint (South Africa)
Glyn Marais Inc.


Legal advisors to Growthpoint (United Kingdom)
Simmons & Simmons LLP

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