DELTA PROPERTY FUND LIMITED - Conclusion of a co-operation agreement between Ascension, Delta and Rebosis

Conclusion of a co-operation agreement between Ascension, Delta and Rebosis

ASCENSION PROPERTIES LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2006/026141/06)
JSE share code for A-linked units: AIA ISIN: ZAE000161881
JSE share code for B-linked units: AIB ISIN: ZAE000161899
(Approved as a REIT by the JSE)
(“Ascension”)

DELTA PROPERTY FUND LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2002/005129/06)
Share code: DLT ISIN: ZAE000172052
(Approved as a REIT by the JSE)
("Delta")

REBOSIS PROPERTY FUND LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2010/003468/06)
JSE share code: REB   ISIN: ZAE000156147
(Approved as a REIT by the JSE)
("Rebosis")



CONCLUSION OF A CO-OPERATION AGREEMENT BETWEEN ASCENSION, DELTA AND REBOSIS

1.1       Introduction

          The boards of Ascension, Delta and Rebosis (collectively, “the Parties”)
          are pleased to announce that the Parties have concluded a written co-
          operation agreement in terms of which each party undertakes to the other a
          duty of utmost good faith in co-operating to explore a tripartite merger
          of the Parties (“the Proposed Merger”).

1.2       Rationale for the Proposed Merger

          The rationale for the Proposed Merger includes, inter alia, the following:

      -   capital available to smaller market capitalisation REITs is increasingly
          constrained, driving consolidation and corporate activity in order to best
          serve the interests of the REITs linked unitholders and tenants;
      -   the values of the property portfolio and market capitalisation of the
          merged entity are anticipated to be in excess of R16.5 billion and R9.5
          billion, respectively ,and accordingly the Proposed Merger will establish
          the largest listed black economic empowerment property fund on the JSE
          Limited;
      -   the growth aspirations of each of the Parties will be fast tracked as
          strategic platforms are consolidated;
      -   the merged entity is expected to attract interest from a wider group of
          investors thereby increasing the liquidity of the merged entity and may
          accordingly result in a re-rating of the merged entity; and
      -   the Proposed Merger is expected to position the merged entity to make
          further yield enhancing acquisitions and its increased size should provide
          the merged entity with greater access to debt and capital markets at
          competitive rates and generally to have a lower cost base, thereby
          improving the prospects of the merged entity.
1.3       Swap ratio and legal structure

          The swap ratio and legal structure of the Proposed Merger will be
          determined and agreed by the respective independent boards of the Parties
          post:
         -   the satisfactory conclusion by each of the Parties of a due diligence
             investigation on each of the other Parties; and
         -   the independent valuation of each of the Parties’ property portfolios,
         and will be announced in due course.

1.4      Board composition

         The proposed board of the merged entity is       in   the   process   of   being
         finalised and will be announced in due course.

1.5     Cautionary

        Linked unitholders of Ascension, Delta and Rebosis are advised to continue
        to exercise caution when dealing in their linked units until further
        announcements have been made.



25 February 2014

Johannesburg


Joint transaction advisors to the Parties
Java Capital
Nedbank Capital


Sponsor to Ascension and Rebosis
Java Capital


Sponsor to Delta
Nedbank Capital


Legal advisors
Bowman Gilfillan
Cliffe Dekker Hofmeyr

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