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RIN - Redefine Properties International Limited - Acquisition of The Crowne Plaza Hotel Redefine Properties International Limited (formerly Kalpafon Limited) (Incorporated in the Republic of South Africa) (Registration number 2010/009284/06) JSE share code: RIN ISIN Code: ZAE000149282 ("RIN" or "the company") ACQUISITION OF THE CROWNE PLAZA HOTEL INTRODUCTION Linked unitholders are advised that the company`s subsidiary Redefine Hotels Reading Limited ("RHR" or "the purchaser") concluded an agreement ("the sale and purchase agreement") with Pedersen (UK) Limited ("the seller") in terms of which RHR has agreed to acquire, inter alia, the Caversham Hotel Thames Side Promenade Reading ("the hotel") and the leasehold on which the hotel is situated for a purchase price of GBP12.75 million ("the transaction"). RATIONALE FOR THE TRANSACTION The hotel is well located close to the town centre of Reading on the banks of the River Thames in the UK. It was originally opened in 1979 and was extensively refurbished in 2005 when it was branded a four star Crowne Plaza hotel under a franchise agreement ("the franchise agreement") with Six Continents Hotels Inc. The franchise agreement expires in June 2025. RHR will enter into a new franchise agreement with Six Continents Hotels Inc on similar terms to the existing agreement. The hotel has conferencing and banqueting facilities as well as a Health, Fitness and Beauty Centre including an indoor pool. There is also a 200 space car park within the property. The hotel forms part of a portfolio of 4 hotels that was placed into administration in 2010 and that have now been brought to the market individually by the administrators. The transaction is in line with RIN`s objective of increasing its presence in the UK hotel market and is expected to be earnings enhancing for linked unit holders in the medium to long term. The acquisition will complement the company`s existing hotel portfolio of 5 high quality hotels. SALIENT TERMS OF THE TRANSACTION The effective date of the transaction will be the later of 1 June 2011 or two business days after the date on which the condition as set out below has been satisfied or waived ("effective date"). The transaction is subject to the seller receiving the written consent of the landlord to the transfer of the leasehold rights to the purchaser. The balance of the purchase price (less the deposit of GBP637 500 which was paid on signature of the sale and purchase agreement) is payable in cash on the effective date. It is intended that the purchase price of GBP12.75 million (inclusive of the deposit) plus transaction costs of GBP0.8 million, will be funded as follows: - Debt of GBP7.65 million has been secured on favourable terms from Aareal Bank AG. - Bashir Hakanmali Nathoo, Enderle International Limited and Corovest Mezzanine Capital Limited will subscribe for in aggregate approximately GBP5.7 million (collectively, "the subscriptions"), in Redefine Hotel Holdings Limited ("RHH"), reducing RI plc`s 77.82% shareholding in RHH to approximately 71.04%. - The balance of approximately GBP0.2 million will be funded using internal cash resources of RI plc. The sale and purchase agreement contains limited warranties typical for acquisitions of this nature. After implementation of the transaction, RHR has agreed, at its sole cost and expense, to enter into a new franchise agreement with Six Continents Hotels Inc. to operate the hotel as a Crowne Plaza Hotel in place of the seller. The acquisition of the hotel is expected to be implemented on or around 1 June 2011. THE HOTEL Details of the hotel including the valuation, effective as at 28 February 2011 attributed to the hotel by the company, are as follows: Property Region Sector Weighted Rentable Purchase Valuation description average area price rental
per m2 (GBP) (sq (GBP` (GBP` metres) million) million) Caversham Reading, Hotel 320.53 3,163 12.75 12.75 Hotel Thames Berkshire Side United Promenade Kingdom Reading FINANCIAL EFFECTS The unaudited pro forma financial effects of the transaction on the distribution, earnings, headline earnings, net asset value and net tangible asset value per linked unit, based on RIN `s unaudited condensed consolidated interim results for the six months ended 28 February 2011, are not material and have not been disclosed. CATEGORISATION OF THE TRANSACTION AND THE SUBSCRIPTIONS The transaction is a category 2 transaction in terms of section 9.5(a) of the Listings Requirements of the JSE Limited. The subscriptions are neither category 1 transactions nor category 2 transactions in terms of the Listings Requirements of the JSE Limited and accordingly, no further details have been provided in this announcement. 10 May 2011 Sponsor to Redefine Properties International Limited Java Capital Date: 10/05/2011 11:31:01 Supplied by www.sharenet.co.za Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on, information disseminated through SENS.
