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HYP - Hyprop Investments Limited - Disposal of 50% interest in Southcoast Mall to Redefine Properties Limited Hyprop Investments Limited (Incorporated in the Republic of South Africa) (Registration No. 1987/005284/06) Share Code: HYP ISIN Code: ZAE000003430 ("Hyprop" or "the company") DISPOSAL OF 50% INTEREST IN SOUTHCOAST MALL TO REDEFINE PROPERTIES LIMITED INTRODUCTION AND RATIONALE Hyprop unitholders are advised that on 2 March 2012 Hyprop and Redefine Properties Limited ("Redefine") entered into an agreement in terms of which Hyprop has disposed of its 50% undivided share in Southcoast Mall ("the disposal") to Redefine. As previously communicated to unitholders, Hyprop`s strategy is to focus on its core portfolio of premium, sizeable shopping centres, including the disposal of non-core assets and smaller underperforming properties. As part of this strategy Hyprop identified its 50% interest in Southcoast Mall (which it co-owns with Redefine) as an asset for disposal. Towards the end of 2011,a process to dispose of Southcoast Mall was embarked upon and a third party purchaser identified and the principal terms agreed. Redefine then elected that, instead of Hyprop disposing of its interest in Southcoast Mall to the third party purchaser, Redefine would exercise its pre-emptive right to acquire Hyprop`s undivided share on the same terms and at the same price. TERMS OF THE DISPOSAL Hyprop has, subject to the fulfilment of the conditions precedent set out below, sold its 50% undivided share in Southcoast Mall, together with its 50% undivided share in the related immovable property ("the property") for an amount of R108 500 000 ("the purchase price") with effect from the date of transfer of Hyprop`s 50% undivided share in the property (the "effective date"). The purchase price shall be increased by an amount equivalent to 0.0219% in respect of each calendar day by which the effective date is delayed beyond 30 April 2012. The purchase price, together with any such increase, shall be discharged in cash on the effective date. The purchase price will be used by Hyprop to discharge debt. In the event the effective date does not occur before 31 December 2012, either party shall be entitled to cancel the agreement on written notice to the other party. CONDITIONS PRECEDENT The disposal is subject to the following conditions precedent: - the securing, to the extent necessary, of all approvals and consents required from the Competition Authorities by no later than 30 April 2012; and - the requisite majority of Hyprop unitholders approving the disposal at a meeting of unitholders called for this purpose by no later than 30 April 2012. The date for fulfilment of the conditions precedent may be extended by mutual agreement between the parties. THE PROPERTY Details of the property are as follows: Property name and address Southcoast Mall Geographical location KwaZulu Natal Rental Area (m2) 29 361 Weighted Average rental (per m2) R89 Sector Retail Effective date of disposal On transfer of the property Purchase price R108 500 000 Valuation (Hyprop share) as at 31 R122 000 000 December 2011 by Ali Su Smith of Old Mutual Investment Group South Africa* * The valuer is independent and registered as a professional associate valuer in terms of the Property Valuers Profession Act, No. 47 of 2000. CATEGORISATION OF THE DISPOSAL AND RELATED PARTY CONSIDERATIONS As Redefine is a material unitholder of Hyprop, the disposal constitutes a small related party transaction in terms of section 10.7 of the JSE Listings Requirements. A small related party disposal is not subject to unitholder approval, if (where the subject of the transaction is property) there is an independent valuation reflecting a valuation that is the same or lower than the purchase price. Given that, in this instance, the purchase price is at a discount to the value of the property (being a R13,5 million or 11% discount to the valuation) per the independent valuer`s valuation, the disposal requires, inter alia, a circular to Hyprop`s unitholders ("the circular") and approval of the disposal by Hyprop`s unitholders, subject to simple majority of the votes of unitholders other than Redefine and its associates. The circular will be issued in due course. FINANCIAL EFFECTS The financial effects of the disposal on the - * net assets and net tangible assets per unit; * historical earnings and headline earnings per unit, are not significant and have therefore not been published in this announcement. The JSE Listings Requirements regards 3% as being significant. Johannesburg 5 March 2012 Corporate advisor, legal advisor and sponsor to Hyprop Java Capital Date: 05/03/2012 16:25:01 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.
