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Update On Corporate Action And Renewal Of Cautionary Announcement
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”)
UPDATE ON CORPORATE ACTION AND RENEWAL OF CAUTIONARY ANNOUNCEMENT
1. Update on the corporate action relating to the Redefine
Proposal
Unitholders of Fountainhead (“Unitholders”) are referred to
Fountainhead’s cautionary announcement released on SENS on 13
December 2012 (“Fountainhead’s December Announcement”) relating to
the decision of the independent committee (“the Independent
Committee”) of the board of directors of Fountainhead Property
Trust Management Limited (“Fountainhead Manco”) to engage
exclusively with Redefine Properties Limited (“Redefine”) in
respect of Redefine’s proposed acquisition of Fountainhead’s
assets (“Redefine Proposal”).
The Independent Committee continues to engage with Redefine in
relation to the conclusion of a sale agreement in respect of the
Redefine Proposal on the basis set out in Fountainhead’s December
Announcement. The negotiation between Fountainhead Manco and
Redefine in relation to the sale agreement is complete in all
material respects. However, the recently appointed trustee of
Fountainhead (“Trustee”), which is a party to the sale agreement,
has today requested certain information, and has advised that it
is doing certain work, in order for it to be satisfied that the
Collective Investment Schemes Control Act No 45 of 2002 (“CISCA”)
and Fountainhead’s trust deed have been complied with in respect
of the proposed execution of the sale agreement. The Independent
Committee has, accordingly, resolved to extend the exclusivity
with Redefine until 22 February 2013, in order to provide time to
respond to the Trustee’s request for information and for the
Trustee to do its work.
The Independent Committee has noted the various newspaper articles
relating to the decision of the Independent Committee to engage
with Redefine on an exclusive basis, and is aware of
correspondence sent to the Financial Services Board (“FSB”) and
the Trustee in this regard. Some of these articles and
correspondence have questioned the decision of the Independent
Committee to engage exclusively with Redefine.
The Independent Committee wishes to reiterate, in light of such
articles and correspondence, that it remains of the view that,
taking all relevant considerations into account, its decision to
engage exclusively with Redefine is in the best interests of
Unitholders. The Independent Committee has, in this regard, met
with the FSB and the Trustee to explain and provide the details
and circumstances of all decisions taken by the Independent
Committee to date. The Independent Committee understands that the
FSB and the Trustee have the same imperative for protecting the
best interests of Unitholders.
Regarding the details and circumstances of the Independent
Committee’s decisions, it is noted that, if a sale agreement is
concluded with Redefine, a full terms announcement and timetable
will be released on SENS and in the press. In addition, a
circular will be distributed to Unitholders (“Fountainhead
Circular”). The Independent Committee aims to include
comprehensive details in such Fountainhead Circular so as to
permit Unitholders to make an informed investment decision in
respect of the Redefine Proposal. This will include, without
limitation:
- details of the key terms and conditions, and considerations in
respect of, the unsolicited proposals received from Redefine and
Growthpoint Properties Limited (“Growthpoint”) (“the Proposals”);
- why the decision was taken by the Independent Committee to first
proceed with Redefine on an exclusive basis;
- the view of QuestCo Proprietary Limited (“the Independent
Expert”), which has been appointed by the Independent Committee to
evaluate whether the terms of the Redefine Proposal are fair; and
- the view of the Independent Committee.
The Independent Committee will also invite Redefine, Growthpoint,
the FSB and the Trustee to provide to the Independent Committee
their views in respect of the Proposals for inclusion in the
Fountainhead Circular.
Unitholders will be requested to vote on whether the Redefine
Proposal must be implemented or not. The Independent Committee
will also seek guidance from Unitholders, as one of the items to
be voted on pursuant to the Fountainhead Circular, as to whether
or not they wish the Independent Committee to progress discussions
with other parties (including Growthpoint, if it is still
interested in the Fountainhead assets), if the Redefine Proposal
is voted down. Should Unitholders vote against further engagement
with other parties to sell the assets of Fountainhead, the default
position will be to retain the status quo and Redefine will
continue to manage the properties owned by Fountainhead in terms
of CISCA and Fountainhead’s trust deed. Unitholders should be
aided, in this regard, by the details and risks to be highlighted
in the Fountainhead Circular.
2. Further cautionary announcement
As no written agreement has been concluded with Redefine at this
time, Unitholders are advised to continue to exercise caution when
trading in their Fountainhead units until a further announcement
is made.
30 January 2013
Merchant bank and transaction sponsor
RAND MERCHANT BANK (A division of FirstRand Bank Limited)
Legal Advisor
Bowman Gilfillan Inc.
Independent Expert
Questco Proprietary Limited
Date: 30/01/2013 05:05:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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