FOUNTAINHEAD PROPERTY TRUST - Acquisition of Robor

Acquisition of Robor

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 number 1983/003324/06)
JSE share code: FPT       ISIN: ZAE000097416
(Approved as a REIT by the JSE)
(“Fountainhead”)


ACQUISITION OF ROBOR


Introduction

Fountainhead unitholders are advised that Fountainhead has entered into a sale and leaseback agreement (the “acquisition
agreement”) with Robor Proprietary Limited (“Robor”) in terms of which, inter alia, Fountainhead will acquire, from
Robor, the property situated at 233 Barbara Road, Elandsfontein known as Robor (“the property”) with effect from
registration. (“the acquisition”).

Established in 1922, Robor (Pty) Ltd is the largest tube and pipe manufacturing business in Southern Africa, with a
leading position in most of its markets. Robor is active in most industries exporting to over 50 countries worldwide.

Terms and conditions to the acquisition

The purchase price payable by Fountainhead in respect of the acquisition is R570 700 000 plus VAT and is payable in
cash against registration of the property into the name of Fountainhead.

The Robor lease provides for the terms on which the property will be let by Fountainhead, as landlord, to Robor, as
tenant, following the implementation of the acquisition (the “Robor lease”).

The acquisition is subject to the fulfilment, or waiver, if applicable, of the following conditions precedent:

-       the procurement of letters from FirstRand Bank Limited, in its capacity as trustee of Fountainhead, recording the
        approval of the execution and performance by Fountainhead of the acquisition agreement and all transactions
        contemplated therein within 7 days of the signature date thereof;
-       to the extent required, unconditional approval (or approval on conditions reasonably acceptable to Robor and
        Fountainhead) of the Competition Authorities of the acquisition within 90 days of the signature date of the
        acquisition agreement; and

The acquisition is in line with Fountainhead’s strategy to acquire large, quality assets with sustainable income growth and
a low risk profile. To this end, the acquisition price and lease terms translate into an initial yield of 8.5%, escalating at 8%
per year over an initial term of 10 years on a triple net lease basis.

Property information

The property specific information required in terms of the JSE Listings Requirements in relation to the property is set out
below.

    Property name and address:                     Robor, 233 Barbara Road,
                                                   Elandsfontein
    Sector:                                        Industrial
    Geographical location:                         Gauteng
    Rentable Area:                                 120 277m2
    Net weighted average rental per m2:            R33.78
                                                                                                                            2

No independent valuation has been carried out and the board of Fountainhead is of the view that the purchase price of
R570.7 million represents the value of the property.

Categorisation of the acquisition

The acquisition is classified as a Category 2 transaction in terms of the JSE Listings Requirements. Accordingly, it is not
subject to approval by Fountainhead’s unitholders.

Financial effects

The effect of the acquisition on Fountainhead’s net asset value per unit, basic earnings per unit, headline earnings per unit
and distributable earnings per unit are not significant (less than 3%) and therefore have not been disclosed.

The unaudited pro forma financial effects are the responsibility of the directors of Fountainhead and have not been
reviewed or reported on by the company’s auditors.


03 March 2014


Corporate advisor and sponsor                 Financial advisor to Robor             Legal advisor to Robor
Java Capital                                  Rand Merchant Bank                     Fluxmans Attorneys

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