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FOUNTAINHEAD PROPERTY TRUST - Receipt of indicative proposal and renewal of cautionary announcement

Release Date: 01/10/2012 17:40
Code(s): FPT     PDF:  
Wrap Text
Fountainhead Property Trust

A Collective Investment Scheme in property registered in terms of
the Collective Investment Schemes Control Act, No. 45 of 2002 and
managed by Fountainhead Property Trust Management Limited (Registration No. 1983/003324/06) Share Code: FPT ISIN Code: ZAE000097416 ('Fountainhead')
RECEIPT OF INDICATIVE PROPOSAL AND RENEWAL OF CAUTIONARY ANNOUNCEMENT
Unitholders of Fountainhead ('Unitholders') are referred to the
cautionary announcements released by Redefine Properties Limited
('Redefine') on the Securities Exchange News Service ('SENS') on
11 September 2012 and today, 1 October 2012, as well as the
cautionary announcement released by Fountainhead on 13 September
2012 relating to Redefine's proposal to acquire the assets of
Fountainhead in return for a combination of Redefine units and Hyprop Investments Limited ('Hyprop') units.
The independent sub-committee of the board of directors of
Fountainhead Property Trust Management Limited ('Independent
Committee') hereby informs Unitholders that it has received an
indicative proposal from Redefine to acquire the majority of the
assets of Fountainhead ('Redefine Proposal'). The Redefine
Proposal is indicative in nature, is not a binding offer and
summarises, subject to formal agreements being concluded, what
Redefine intends will be its proposal to be put to Unitholders.
The salient terms of the Redefine Proposal are as follows:
- Redefine will acquire all properties within the Fountainhead
portfolio other than Orion Place (latest valuation R3.8m), Gail
Industrial Park (latest valuation R3.5m) and Precision House (latest valuation R1.7m) from Fountainhead;
- In consideration, Redefine will deliver 726 693 593 Redefine
units and 34 881 292 Hyprop units to Unitholders, which equates to
62.5 Redefine units and 3 Hyprop units for every 100 Fountainhead units held;
- The Redefine units will be issued ex-entitlement to a special
interest distribution that will be declared for the period 1
September 2012 to the effective date, but will participate in all
subsequent distributions. The Hyprop units will participate fully
in any income distributions declared after the effective date
(including distributions for the six month period ending 31 December 2012);
- All interest bearing debt as at the effective date will be
assumed or settled by Redefine. Redefine has indicated a debt
balance of R2 696 874 750 as at the date of the Redefine Proposal
and that no further increase in this balance will be permitted;
- Fountainhead working capital will be excluded from the possible
transaction and available for distribution to Unitholders at the conclusion of the possible transaction;
- Fountainhead will retain its JSE listing with the intention of
it holding a new portfolio of properties as part of a broader
Black Economic Empowerment strategy for Redefine and Unitholders
will retain their participatory interests in Fountainhead;
- Six properties in the Fountainhead portfolio are subject to pre-
emptive agreements and, as such, a monetary value has been
assigned by Redefine to each such property. The full sale
proceeds of any such properties acquired by pre-emptive rights
holders before the effective date will become payable to Redefine.
Properties with pre-emptive rights and Redefine's assigned values are as follows: - Westgate Shopping Centre R840,774,124 - Southgate Mall R211,980,480 - Southgate Value Market R25,957,525 - N1 City Mall R821,579,881 - Constantia Kloof 3 R281,983,773 - Sunridge R38,977,714
From its initial analysis of the Redefine Proposal, it appears to
the Independent Committee that there are a number of issues which
require further clarification and discussion. The Independent
Committee and its advisors will engage with, amongst others,
Unitholders, regulatory authorities and Redefine in order to
ensure that the interests of the Unitholders are appropriately considered and protected.
Unitholders are advised that Fountainhead will, in due course,
provide guidance on the budgeted distributions for the 2013
financial year to enable the investors to appraise the Redefine
Proposal on a fully informed basis. In addition, the Independent
Committee has appointed an independent expert to advise the
Independent Committee on the fairness of the Redefine Proposal.
Unitholders are advised to continue to exercise caution when
trading in their Fountainhead units until a further announcement is made. 1 October 2012 Merchant bank and transaction sponsor
RAND MERCHANT BANK (A division of FirstRand Bank Limited) Legal Advisor Bowman Gilfillan Inc.
Date: 01/10/2012 05:40:00 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.

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