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BNT - Bonatla Property Holdings Limited - Acquisition of two new properties and
renewal of cautionary announcement
BONATLA PROPERTY HOLDINGS LIMITED
Incorporated in the Republic of South Africa
Registration Number 1996/014533/06
Share Code: BNT
ISIN Number: ZAE000013694
("Bonatla" or "the company")
ACQUISITION OF TWO NEW PROPERTIES AND RENEWAL OF CAUTIONARY ANNOUNCEMENT
Shareholders are advised that the company, through its wholly owned subsidiary
Bonatla Properties (Proprietary) Limited ("BP"), has concluded two further
agreements dated 02 December 2010, in relation to the acquisition of the three
remaining properties in the Blue Zone portfolio, namely Flextronics and Austin
Crossing ("the acquisitions"). The remaining acquisition of the property known
as Madeleine Street is still being negotiated. The rationale for the
acquisitions is the continued expansion of the property portfolio of Bonatla in
line with its stated intention to grow the property portfolio.
1. Terms and details of the Flextronic acquisition
Liberty Lane Trading 98 Limited is the seller of 100% of the shares and
claims in Tropical Paradise Trading 334 (Proprietary) Limited, which holds
the Flextronics property, located at 1060 Surrey Avenue, Ferndale,
Randburg, which property earns rental income. The gross lettable area
comprises office space measuring 5 479m2 and attracts rental income at a
weighted average rental of R86 per square metre from three tenants, of
which 14% is vacant. There are no borrowings against the property.
The purchase consideration is R65 million, which will be settled through
the issue of ordinary and preference shares in Bonatla as follows:
- Bonatla ordinary shares at a ratio of 1 to 1 000 of the purchase
consideration issued to be issued at 75 cents per share, with the
number of shares to be issued to be calculated at the lower of 75
cents or the purchase consideration divided by the Net Asset Value
("NAV") per share, which NAV per share will comprise the issued shares
at the signature date as well as shares to be issued per the
acquisition circular, which will detail this Flextronic acquisition
and other acquisition.
- Bonatla non-participating, non-redeemable, non-cumulative, compulsory
convertible preference shares ("preference shares") at a ratio of 1
000 preference shares for every ordinary share issued above at an
issue price of 75 cents per preference share.
Two years from completion date, a revaluation of net rental will be
undertaken and the normalised net income will be capitalised at 11% and if
the net contractual annual rental after deduction of all operating costs
exceeds R8 million per annum, then the value of the building will deemed to
be R87 million and Bonatla will issue additional ordinary shares to the
value of R22 million, at an issue price based on net asset value per share
as per Bonatla`s last quarterly management accounts.
The preference shares will attract a dividend equal to the money market
rate at Standard Bank from time to time and will be payable quarterly in
advance. Each preference share will convert into one ordinary Bonatla
share on the second anniversary date.
The risk in and benefits of the acquisition will pass to Bonatla on the
possession date and effective date, being the date that the court sanctions
the Section 3 Compromise Offer in terms of the Companies Act, which is
expected to be during the first half of 2011.
The agreement, dated 2 December 2010, contains normal warranties in
relation to a property transaction.
2. Terms and details of the Austin Crossing acquisition
Austin Crossing Holdings (Proprietary) Limited is the seller 100% of the
shares and claims in Austin Crossing Properties (Proprietary) Limited,
which holds the Austin Crossing property, located at Stand 961 Wilkoppies
X18 Remaining Extension of Portion 576 of Farm Doornfontein 92, Klerksdorp,
which property earns rental income. The gross lettable area comprises
office space measuring 672m2 and attracts rental income at a weighted
average rental of R82 per square metre from two tenants, of which 9% is
vacant.
The purchase consideration is R7 million, which will be settled through the
issue of ordinary and preference shares in Bonatla as follows:
- Bonatla ordinary shares at a ratio of 1 to 1 000 of the purchase
consideration issued to be issued at 75 cents per share, with the
number of shares to be issued to be calculated at the lower of 75
cents or the purchase consideration divided by the Net Asset Value
("NAV") per share, which NAV per share will comprise the issued shares
at the signature date as well as shares to be issued per the
acquisition circular, which will detail this Austin Crossing
acquisition and other acquisition.
- Bonatla non-participating, non-redeemable, non-cumulative, compulsory
convertible preference shares ("preference shares") at a ratio of 1
000 preference shares for every ordinary share issued above at an
issue price of 75 cents per preference share.
The preference shares will attract a dividend equal to the money market
rate at Standard Bank from time to time and will be payable quarterly in
advance. Each preference share will convert into one ordinary Bonatla
share on the second anniversary date.
The risk in and benefits of the acquisition will pass to Bonatla on the
possession date and effective date, being the date that the court sanctions
the Section 311 Compromise Offer in terms of the Companies Act, which is
expected to be during the first half of 2011.
3. Conditions precedent
The acquisitions are subject to the following conditions precedent being
fulfilled or waived by no later than 28 February 2011 for the Flextronic
acquisition and 31 December 2010 for the Austin Crossing acquisition,
unless indicated otherwise:
- Shareholders of the seller pass a section 228 resolution authorising
the disposal of the equity by 31 January 2011;
- Regulatory approvals in terms of the Competition Authority, the JSE
Listings Requirements and Securities Regulation Panel, where required,
which completion date is automatically extended to allow for
completion thereof;
- Board of directors approval of the company whose equity is being sold
- Board of directors approval by the purchaser;
- Approval by Bonatla shareholders, in general meeting;
- Successful completion of the Section 311 offer of compromise to
creditors by 31 May 2011 for the Flextronic acquisition and 31 March
2011 for the Austin Crossing acquisition and registration of the
relevant CM18 with CIPRO.
4. Other matters
Once the equity of the two companies has been acquired, the articles of
association of the two subsidiaries will be amended to conform to Schedule
10 of the JSE Listings Requirements.
No commission has been paid or is payable in relation to the acquisitions.
Normal warranties have been included in the agreements as would be expected
in relation to the acquisition of property owning companies.
The properties will be valued by an independent valuer, which property
valuation will be included in a circular to shareholders. In addition, pro
forma financial effects are not yet available and will be announced in due
course.
RENEWAL OF CAUTIONARY ANNOUNCEMENT
Shareholders are advised that they should continue to exercise caution until the
pro forma financial effects and details of the valuation of the Flextronics and
Austin Crossing acquisitions are published.
In addition, shareholders are referred to prior cautionary announcement issued
on 15 November 2010 and are advised that the company is still in negotiations or
in the process of publishing pro forma financial effects in relation to
previously announced acquisitions and thus shareholders should continue to
exercise caution in dealing in their securities until a further announcement is
made.
Houghton
4 January 2011
Sponsor
Arcay Moela Sponsors (Proprietary) Limited
Date: 04/01/2011 16:55:01 Supplied by www.sharenet.co.za
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