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Ann iro the proposed acquisition of a portfolio of properties from Capital Property Fund, Renewal of cautionary etc
Ascension Properties Limited
(formerly Grey Jade Trade and Invest 85 (Proprietary) Limited)
(Incorporated in the Republic of South Africa on 23 August 2006)
(Registration number 2006/026141/06)
A-linked units JSE code: “AIA” ISIN: ZAE000161881
B-linked units JSE code: “AIB” ISIN: ZAE000161899
(“Ascension” or “the company”)
ANNOUNCEMENT IN RESPECT OF THE PROPOSED ACQUISITION OF A PORTFOLIO OF
PROPERTIES FROM CAPITAL PROPERTY FUND, RENEWAL OF CAUTIONARY
ANNOUNCEMENT AND UPDATE ON 373 PRETORIUS STREET
INTRODUCTION
Linked unitholders are referred to the cautionary announcement released on SENS on 24 August 2012 and
are advised that Ascension has concluded agreements with Capital Property Fund (“Capital”) and various
subsidiaries of Capital (collectively, “the vendors”) to acquire a portfolio of property letting enterprises
(“acquisition properties”) (each an “acquisition” and together “the acquisitions”) from the vendors.
PROPOSED TERMS OF THE ACQUISITIONS
In terms of the acquisition agreements the letting enterprises in respect of the acquisition properties will be
acquired with effect from 1 December 2012.
If the transfer date for the acquisition properties is after 1 December 2012, then interest will be payable on
the cash portion of the purchase price calculated at the rate of 0.75% per month from 1 December 2012 to
the actual date of transfer, calculated daily and compounded monthly in arrears.
The aggregate purchase price for the acquisition properties is R989 196 354 and is payable against transfer
of ownership of each of the properties comprising the acquisition properties into the name of Ascension. The
purchase price for the acquisition properties will be settled in part by way of a cash payment of
R494 598 177 and the balance by way of an issue of A-linked units and B-linked units (“consideration
units”) in the following proportions:
- R370 948 633 will be settled through the issue of 91 592 255 A-linked units to the vendors at an issue
price of R4.05 per A-linked unit; and
- R123 649 544 will be settled through the issue of 61 824 772 B-linked units to the vendors at an issue
price of R2.00 per B-linked unit.
The cash payment is to be secured by an unconditional and irrevocable bank guarantee from Ascension to
each of the vendors. Ascension will secure the transfer and allotment of the consideration units by delivering
a renounceable letter of allotment to each of the vendors.
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The consideration units are to be issued “ex” entitlement to the interest distribution for the period prior to the
acquisition effective date, 1 December 2012.
In order to achieve this, the directors of Ascension will declare and pay a special distribution for the period
ending 30 November 2012 together with the distribution for Ascension’s first income period, being the
period from date of listing, 11 June 2012, to and including 30 June 2012.
The acquisition agreements contain warranties that are typical for acquisitions of this nature.
Subject to what is stated in the paragraph below, the cash payment will be funded through debt. Appropriate
debt funding is being arranged by way of a facility from The Standard Bank of South Africa Limited.
If market conditions are appropriate a portion of the cash payment may be funded through a vendor
consideration placement of Ascension linked units which will be undertaken in accordance with the JSE
Listing Requirements. The number of A-linked units and B-linked units to be issued and the prices at which
they will be issued will be determined at the time of such vendor consideration placement. In accordance
with the Listings Requirements, the minimum placing price will be the lower of a 10% discount to the
30 business day weighted average traded price prior to the date that the placing is authorised by the
directors, or a 10% discount to the three business day weighted average traded price prior to the date of
placing.
As stated below, Capital has undertaken to initiate an unbundling of the consideration units in order to
improve liquidity in Ascension’s linked units. The vendors will use their best endeavours to unbundle the
consideration units to the unitholders of Capital after the date of transfer. Should Capital not obtain
regulatory or unitholder approval for the proposed unbundling, then Capital will, in good faith, consult
Ascension with a view to reaching an alternative solution.
RATIONALE FOR THE ACQUISITIONS
Ascension has previously stated that it intends to grow its property portfolio by at least R1 billion per annum
to achieve its goal of becoming a multi-billion Rand company over the next few years. If the acquisitions
are successfully concluded, Ascension will have a total property portfolio valued at approximately
R2.2 billion.
In addition, in order to improve liquidity in Ascension’s linked units, Capital has undertaken to initiate an
unbundling of the consideration units to the unitholders of Capital after the date of transfer.
DETAILS OF THE ACQUISITION PROPERTIES
Details of the properties comprising the acquisition properties, including the property name and address,
geographical location, rentable area, sector, weighted average rental per square metre, purchase price and
valuations attributed to the properties as at 1 November 2012 by Peter Parfitt of Quadrant Properties
(Proprietary) Limited, who is independent and registered as a professional valuer in terms of the Property
Valuers Profession Act, No 47 of 2000, are as follows:
Property name and address Geographical Rentable Sector
location area (m2)
1. Meyersdal, 65 Phillip Engelbrecht Street, Gauteng 4 979 Office
Meyersdal
2. Infinity Office Park Meyersdal, Robin Gauteng 13 481 Office
Close, Meyersdal
3. 238 Roan Crescent, Corporate Park, 238 Gauteng 9 035 Office
Roan Crescent, Corporate Park
4. Grand Central, Cnr Darling and Plein Western Cape 33 616 Office and
Streets, Cape Town retail
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5. Medscheme, 37 Conrad Drive, Constantia Gauteng 6 792 Office
Kloof
6. Kingfisher Crescent Meyersdal, Kingfisher Gauteng 1 445 Office
Crescent, Meyersdal
Property name and address Weighted average Purchase Valuation as at
rental per square price 1 November
metre (R) 2012
(R/m2)
1. Meyersdal, 65 Phillip Engelbrecht Street, 93.1 51 880 232 51 880 232
Meyersdal
2. Infinity Office Park Meyersdal, Robin 120.1 203 165 385 203 165 385
Close, Meyersdal
3. 238 Roan Crescent, Corporate Park, 238 81.9 90 935 705 90 935 705
Roan Crescent, Corporate Park
4. Grand Central, Cnr Darling and Plein 106.7 492 393 203 492 393 203
Streets, Cape Town
5. Medscheme, 37 Conrad Drive, Constantia 126.1 133 988 353 133 988 353
Kloof
6. Kingfisher Crescent Meyersdal, Kingfisher 96.8 16 833 476 16 833 476
Crescent, Meyersdal
Total 989 196 354 989 196 354
CONDITIONS PRECEDENT
Each acquisition is subject to the following conditions precedent:
- Ascension undertaking and completing to its satisfaction a due diligence investigation of the acquisition
properties within a period of 30 days after the date of signature of the acquisition agreements being
14 September 2012;
- the vendors approving the disposal of the acquisition properties in terms of the acquisition agreements
to Ascension by no later than 7 days after the completion of the due diligence referred to in the
paragraph above;
- Ascension procuring written confirmation from a financial institution reasonably acceptable to the
vendors, that it has been granted loan funding to fund the cash portion of the consideration payable for
the acquisition properties on or before 1 October 2012;
- the Competition Authorities unconditionally approving the implementation of the acquisitions,
evidenced by the issue of a merger clearance certificate, on or before 30 November 2012;
- by no later than 30 November 2012 the linked unitholders of Ascension having passed the resolutions in
terms of which:
o the purchase of the acquisition properties by Ascension upon the terms set out in the
acquisition agreements are approved; and
o the issue of consideration units referred to above is approved.
The acquisition of the property known as the Grand Central Shopping Centre (“Grand Central”) is subject
to Capital delivering to Ascension written confirmation that the Department of Public Works has not
exercised its “right of first refusal” to purchase Grand Central on or before 9 October 2012 which condition
may not be waived. If this condition is not met, the Grand Central acquisition will fall away, but this will not
affect the remaining acquisitions.
Save for the acquisition of Grand Central, the acquisitions are inter-conditional and must all become
unconditional in accordance with their terms on or before 30 November 2012.
Ascension or the vendors may, in writing, extend the date of fulfilment to a future date/s as they may agree,
or, where appropriate, waive any of the abovementioned conditions precedent.
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Should approval from the Competition Authorities not be obtained by 30 November 2012, the period for
fulfilment of the relevant conditions precedent will automatically be extended by an additional 30 days.
FINANCIAL EFFECTS AND RENEWAL OF CAUTIONARY ANNOUNCEMENT
The financial effects of the acquisitions on Ascension are in the process of being finalised and will be
published in due course.
Ascension linked unitholders are advised to continue exercising caution when dealing in the company’s
linked units until a further announcement is made.
CATEGORISATION AND FURTHER DOCUMENTATION
The acquisitions constitute a category 1 transaction for Ascension in terms of the JSE Listings Requirements
and as such require the approval of Ascension linked unitholders. Accordingly, a circular incorporating
revised listing particulars, detailing the terms of the acquisitions and a notice convening a general meeting
will be posted to Ascension linked unitholders in due course.
UPDATE ON 373 PRETORIUS STREET
Ascension linked unitholders are referred to the announcement published on SENS on 29 June 2012 relating
to the proposed acquisition of the property known as 373 Pretorius Street from Investec Property Fund
Limited (“Investec Property Fund”). Linked unitholders were advised that the purchase price of
R155 million would be funded from new debt facilities from Investec Bank Limited. This has been revisited
and the company will now settle R30 million of the purchase price through a combination of a placing of
new Ascension A-linked units with Investec Property Fund and a placing of new Ascension A-linked units
with third party placees in terms of a vendor consideration placement.
18 September 2012
Corporate advisor and sponsor
Legal advisor
Date: 18/09/2012 07:05:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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