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PPR - Putprop Limited - Acquisition of 25% of Pilot Peridot Investments for
the development of the property known as Summit Place
PUTPROP LIMITED
Incorporated in the Republic of South Africa
(Registration number 1988/001085/06)
Share code: PPR ISIN: ZAE000072310
("Putprop" or "the company")
ACQUISITION OF 25% OF PILOT PERIDOT INVESTMENTS FOR THE DEVELOPMENT OF THE
PROPERTY KNOWN AS SUMMIT PLACE
1. INTRODUCTION AND RATIONALE
The board of directors of Putprop ("the Board") is pleased to inform
shareholders that Putprop has entered into an agreement of sale dated
12 April 2012 ("the Agreement") with Pilot Peridot Investments 1
Proprietary Limited ("Pilot") to acquire a 25% shareholding in Pilot,
via the issuance of new shares in Pilot to Putprop ("the Acquisition").
Pilot owns various properties situated in the township of De Beers,
Registration Division I.Q., Province of Gauteng, on which a mixed used
property known as Summit Place with commercial, retail and hotel
rights, will be developed.
The Acquisition complies with the company`s stated objective of
strategic investments focussed on industrial and commercial
opportunities, where yields are enhancing in the medium and long term
as well as broadening of the current tenant base to reduce the risk of
over dependence on a limited number of tenants.
2. THE ACQUISITION
2.1 Details of Pilot
Pilot owns an undeveloped property situated on the consolidated
erf 47 (in extent 2.412 hectares) in the township of De Beers
Registration Division I.Q. Province of Gauteng ("the Property").
The company intends to convert this asset into a mixed use
development with commercial, retail and hotel rights.
Putprop will only participate and benefit from revenues generated
from the commercial and retail portions of Summit Place, with such
revenue expected only to begin to be generated in the second half
of 2013.
Once development has been completed, it is estimated that the
retail portion will be comprised of a GLA of 4 000 square metres
and the commercial portion will be comprised of a GLA of 33 500
000 square metres. The weighted average rental per square metre
has been estimated at R135.00.
2.2 Purchase consideration and effective date
The total purchase consideration of R25 000 000, which will be
settled entirely in internally generated cash, will be paid for
the issue of new shares as follows:
- The first instalment of R11 000 000 will be paid by the
company to Pilot upon issuance of shares representing a 25%
shareholding in Pilot to Putprop, with such payment expected
to occur no later than 13 April 2012;
- The second instalment of R4 000 000 is expected to be paid by
the company to Pilot on 18 April 2012; and
- The third and final instalment of R10 000 000 is expected to
be paid by the company to Pilot, on 15 May 2012.
Upon payment of the second instalment mentioned above, Putprop will
have the right to appoint two directors to the board of Pilot.
The effective date of the Acquisition is 12 April 2012, being the
fulfilment date of all suspensive conditions. No costs have been
incurred by Putprop in relation to the Acquisition, other than
estimated legal costs of R50 000.
A valuation of the Property was performed prior to the Acquisition by
Putprop`s directors, who are not registered as professional valuers in
terms of the Property Valuers Profession Act, 2000 (No 47 of 2000). The
Property was valued at an estimated amount of R101 million.
2.3 Conditions precedent
All conditions precedent in respect of the Acquisition has been
fulfilled.
3. PRO FORMA FINANCIAL EFFECTS OF THE ACQUISITION
The table below sets out the unaudited pro forma financial effects of
the Acquisition, on Putprop`s earnings per share, headline earnings per
share, net asset value per share and tangible net asset value per
share.
The unaudited pro forma financial effects have been prepared to
illustrate the impact of the Acquisition on the reported financial
information of Putprop for the six months ended 31 December 2011, had
the Acquisition occurred on 1 July 2011 for income statement purposes
and on 31 December 2011 for balance sheet purposes.
The unaudited pro forma financial effects have been prepared using
accounting policies that comply with International Financial Reporting
Standards and that are consistent with those applied in the interim
results for the six months ended 31 December 2011 and the audited
results of Putprop for the year ended 30 June 2011.
The unaudited pro forma financial effects, which are the responsibility
of the directors, are provided for illustrative purposes only and,
because of their pro forma nature may not fairly present Putprop`s
financial position, changes in equity, results of operations or cash
flow.
Before the After Percent
Acquisition the age
Acquisit change
ion (%)
Basic earnings per share 62.6 60.9 (2.8)
(cents)
Headline earnings per share 37.0 35.2 (4.7)
(cents)
Net asset value per share 986.1 986.1 -
(cents)
Tangible net asset value per 986.1 986.1 -
share (cents)
Weighted average number of 28 792 961 28 792 -
shares in issue 961
Notes:
1. The amounts in the "Before the Acquisition" column have been
extracted from the unaudited financial results of Putprop for the
six months ended 31 December 2011.
2. The amounts in the "After the Acquisition" column reflect the
financial effects of the Acquisition on Putprop.
3. The effects on earnings per share and headline earnings per share
are calculated based on the assumption that the Acquisition was
effected on 1 July 2011.
4. The effects on net asset value per share and tangible net asset
value per share are calculated based on the assumption that the
Acquisition was effected on 31 December 2011.
4. CLASSIFICATION OF THE ACQUISITION
The Acquisition is classified as a Category 2 transaction in terms of
the Listings Requirements of the JSE Limited.
13 April 2012
Sponsor
Merchantec Capital
Date: 13/04/2012 16:59:01 Supplied by www.sharenet.co.za
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