Wrap Text
Abridged Pre - Listing Statement
SAFARI INVESTMENTS RSA LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2000/015002/06)
Share code: SAR
ISIN: ZAE000188280
(“Safari” or “the Company”)
ABRIDGED PRE - LISTING STATEMENT – OPENING OF OFFER TO INVITED INVESTORS TO SUBSCRIBE
FOR SHARES AND LISTING OF SAFARI ON THE JSE LIMITED
Abridged pre-listing statement relating to:
- a private placement to raise between R315 million and R400 million by way of a private placing of an offer for subscription to invited
qualifying investors for between 42 million and 52.2 million private placement shares in the company at an issue price to be determined
by demand and for which an indicative issue price of R7.52 per private placement share has been used in this abridged pre-Listing
statement; and
- the subsequent listing of all the shares of the company in the “Real Estate – Retail REIT” sector of the JSE.
This abridged pre-listing statement is not an invitation to the public to subscribe for securities, but is issued in compliance with the
Listings Requirements of the JSE, for providing information to the public with regard to the company. This abridged pre-listing
statement has been issued in connection with the private placement offer in South Africa only and is addressed only to persons to
whom the private placement offer may lawfully be made. The definitions and interpretations commencing on page 13 of the pre-
listing statement dated 28 March 2014 (“the pre-listing statement”) have, where applicable been used in this announcement.
Applicants will only be permitted to apply for shares with a minimum total acquisition cost, per single addressee acting as
principal, of greater than or equal to R1 million unless the applicant is a person, acting as principal, whose ordinary business, or
part of whose ordinary business, is to deal in securities, whether as principal or agent (in reliance on Section 96(1)(a)(i) and
96(1)(b) of the Companies Act) or such applicant falls within one of the other specified categories of persons listed in Section 96(1)
of the Companies Act.
Prospective investors should not treat the contents of this abridged pre-listing statement as advice relating to legal, taxation,
investment or any other matters and should consult their own professional advisers concerning the consequences of their
acquiring, holding or disposing of offer shares. Prospective investors should inform themselves as to:
- the legal requirements within their own countries for the purchase, holding, transfer or disposal of offer shares;
- any foreign exchange restrictions applicable to the purchase, holding, transfer or disposal of Offer Shares which they might encounter;
and
- the income and other tax consequences which may apply to them as a result of the purchase, holding, transfer or disposal of offer
shares. Prospective investors must rely upon their own representatives, including their own legal advisers and accountants, and not
those of the Company, as to legal, tax, investment or any other related matters concerning Safari and an investment therein.
The information contained in this document constitutes factual information as contemplated in section 1(3)(a) of the South African
Financial Advisory and Intermediary Services Act 2002 and should not be construed as an express or implied recommendation,
guidance or proposal that any particular transaction in respect of the offer shares is appropriate to the particular investment
objectives, financial situations or needs of a prospective investor.
Invited investors will be contacted by and will receive application forms to participate in the private placement from the lead
bookrunner, DEA-RU.
This announcement contains the salient information in respect of Safari, which is more fully described in the pre-listing statement made
available to invited investors from Monday, 31 March 2014.
As the offer is not an offer to the public as contemplated under the Companies Act, a copy of the pre-listing statement is not required to be
registered with CIPC pursuant to the Companies Act.
INTRODUCTION
Safari was incorporated as a public company on 7 July 2000 by its founding shareholders and has, in the past ten years, managed to
establish a sought after retail portfolio, focused on high growth township areas. The main focus of the company is to invest into quality
income generating properties, including vacant land with development potential, as well as new property ventures under development in
South Africa and internationally.
The JSE has granted Safari a listing of up to a maximum of 174 064 827 shares in the “Real Estate – Retail REIT” sector of the main board
of the JSE, in terms of the FTSE classification, under the abbreviated name “SAFARI”, JSE share code “SAR” and ISIN ZAE000188280 with
effect from the commencement of trade on Monday, 7 April 2014, subject to obtaining a spread of shareholders acceptable to the JSE in
compliance with the Listings Requirements.
At the date of this abridged pre-listing statement all the relevant JSE Listings Requirements had been complied with, other than the
shareholder spread requirements which can only be met once the allocations have been completed.
The financial year-end of the company is 31 March of each year.
HISTORY
The Safari Group (“the Group”) was founded by Mr Francois Marais approximately fourteen years ago and, through the innovation, effective
management and vision of Mr Francois Marais, with the most valued support of approximately 150 private investors, has expanded into a
high growth retail property company. The growth of the portfolio, facilitated by the Group’s long standing relationship with ABSA and Safari’s
supportive shareholders, led to the creation of a premier portfolio of properties in affluent black townships including prominent nodes such as
Mamelodi, Atteridgeville and Sebokeng amongst others.
Safari originates from three private companies, Safari Pretoria, Safari Atteridgeville and Safari (before its conversion to a public company)
that were incorporated in terms of the Companies Act as Acqui 8 (Proprietary) Limited (11 December 2000), 8 Mile Investments 206
(Proprietary) Limited (13 October 2004) and Zodar Properties No 9 (Proprietary) Limited (7 July 2000), respectively. Each of the
aforementioned companies owned and operated a business of investing in income generating immovable property. On 1 March 2009 the
companies entered into an amalgamation transaction as contemplated in section 44 of the Income Tax Act 58 of 1962 (as amended) through
the sale of the respective businesses of Safari Pretoria and Safari Atteridgeville as going concerns to Safari in one indivisible amalgamation
transaction. In terms of a special resolution registered on 5 August 2009, Safari was converted to a public company and its name was
changed to Safari Investments RSA Limited.
NATURE OF BUSINESS
Safari is a REIT company, formed for the purpose of investing in real estate, for purposes of income generation and capital growth. Safari’s
property portfolio comprises of four well-established, strategically located and quality retail properties and has been independently valued at
approximately R1.276 billion and comprises a total GLA and NLA of approximately 124 925 m² and 97 529 m², respectively. The property
portfolio is 100% retail based and it is the intention of Safari to maintain a retail property portfolio. In this context, Safari offers investors direct
exposure to high quality retail centres.
BUSINESS STRATEGY
Safari has a strong focus on previously disadvantaged communities and under resourced areas where it establishes, develops and promotes
quality assets that uplift and benefit communities by providing a desirable and high-end shopping experience closer to where they live. This
reduces commuting time and costs associated with travelling to regional centres significantly. This approach also targets the problem of
limited tradability of retail properties in these areas, resulting in significantly improved opportunities for the communities in which its property
assets are located. Safari’s portfolio provides stable income and balance sheet strength to secure and fund high-growth opportunities within
its developments. To minimise financial risk, Safari follows a staggered development approach.
Another key objective has been to develop centres within key catchment areas. Additionally the strategic positioning of the retail centres, and
planned developments, ensures that properties are optimally placed to take full advantage of both current and future growth patterns
amongst retailers. This is achieved through the development of centres in strong regional nodes, a strategy that both attracts top quality
national retailers as well as reduces the risk of potential competitors entering the market.
Safari’s strategy is to have approximately 85% of the group’s assets in investments and approximately 15% in developments. The immediate
focus is brownfield developments such as extensions and renovations of the Atlyn and Thabong shopping centres. The unique location of
these properties, and high levels of demand for retail space in the township market, works to Safari’s advantage despite difficult economic
circumstances.
PROSPECTS
- Grow asset base by redeveloping existing property portfolio and by investing in well-priced income producing properties to optimise
capital and income returns over time for shareholders;
- redevelop properties to enhance value and support longer-term income and capital growth;
- expand development pipeline to sustain long-term prospects through opportunities and strategic relationships;
- continue with current projects, being extensions to some centres; and
- the Swakopmund waterfront project.
The current value pipeline of potential projects under consideration is in excess of R1 billion.
PRIMARY OBJECTIVES
- provide an income stream through rental income from the investment properties;
- grow its asset base by developing and investing in fairly valued income producing properties;
- manage and re-develop a quality retail property portfolio that provides good growth opportunities;
- optimise capital growth; and
- allow shareholders to participate in the net income (after providing for related expenditure) by distributing surplus net cash income to
shareholders.
SUMMARISED HISTORIC AND FORECAST FINANCIAL INFORMATION
The table below illustrates the historical growth in investment property value as extracted from the report on historical financial information
included in Annexure 10 to the pre-listing statement:
Asset value 1 March 2010 28 February 2011 29 February 2012 31 March 2013
Investment property (R) 593 638 984 718 564 984 856 811 029 1 054 912 556
Year on year growth % 21.04% 19.23% 23.12%
3 year average growth 25.90%
The table below illustrates the historic and forecast revenue growth as extracted from the statement of forecast financial information and
historical financial information included in Annexures 7 and 10 of the pre-listing statement, respectively:
Rental income before 28 February 2011 28 February 2012 31 March 2013 31 March 2014 31 March 2015
lease smoothing
12 months 12 months 13 months 12 months 12 months
R R R R R
Rental income without 64 679 907 72 862 803 95 646 478 112 874 888 138 533 297
lease smoothing
Year on year growth 12.65% 31.26% 18.01% 22.73%
4 year average growth 28.55%
The tables below set out the salient forecast financial information of Safari for the twelve months ending 31 March 2014 and 31 March 2015
and the salient pro forma statement of financial position of Safari as at 30 September 2013 and should be read in conjunction with the
financial information disclosed in annexures 7 and 5 of the pre-listing statement, respectively. Because of its nature, pro forma financial
information may not fairly present Safari’s financial position, changes in equity, results of operations and cash flows. Such information has
been prepared for illustrative purposes only, and because of its nature may not fairly reflect the financial position and results of the company.
The profit forecast and the pro forma statement of the financial position are the responsibility of the directors of the company and have been
reported on by the independent reporting accountants and auditors.
Profit and distribution forecast
31 March 2014 31 March 2015
12 months 12 months
PROFIT FOR THE YEAR
Profit for the period (rand)1 76 882 663 100 068 344
Add back straight lining of leases adjustment so as to 3 785 688
calculate section 25BB2 distributable profit 2
Profits available for distribution in terms of section - 104 579 956
25BB2 (rand)3
FORECAST DISTRIBUTION PER SHARE IF
SAFARI RAISES R315 MILLION AT R7.52 PER
SAFARI SHARE
Shares in issue on listing (number) raising 162 864 827 162 864 827
approximately R315 million at R7.52 per share4
Forecast distribution per share (cents)5 20.00 68.00
Dividend per share (cents)6 20.00 3.79
Section 25BB2 distribution per share (cents)7 - 64.21
Forecast earnings / headline earnings per share if 79.17 61.40
Safari raises approximately R315 million (cents)8
Forward yield (based on distribution) per share with a
share price of 752 cents per share9 2.65% 9.04%
FORECAST DISTRIBUTION PER SHARE IF
SAFARI RAISES R400 MILLION AT R7.52 PER
SAFARI SHARE
Shares in issue on listing (number) raising
174 064 827 174 064 827
approximately R400 million at R7.52 per share10
Forecast distribution per share (cents)11 20.00 68.00
Dividend per share (cents)12 20.00 7.92
Section 25BB2 distribution per share (cents)13 - 60.08
Forecast earnings / headline earnings per share 79.50 57.49
(cents) if Safari raises approximately R400 million
(cents)14
Forward yield (based on distributions) per share with 2.65% 9.04%
15
a share with a share price of 752 cents per share
Notes:
1. The forecast profit for the financial years ending 31 March 2014 and 31 March 2015 as set out in more detail in
annexure 7 of the pre-listing statement.
2. The straight lining of leases adjustment is added back for determining the distribution per Safari share because it is a
non-cash flow item and can be disregarded in calculating the section 25BB2 distributable profit for the financial year
ending 31 March 2015. Please note that Safari will list after 31 March 2014 and will not be a REIT for taxation
purposes for the financial year ending 31 March 2014. Safari will be a REIT for JSE and taxation purposes for the
financial year ending 31 March 2015.
3. The distributable profit for Safari as a REIT in terms of Section 25BB2 for the financial year ending 31 March 2015.
4. Assumes 42 million new Safari shares are issued at an issue price of R7.52 per Safari share raising approximately
R315 million. This scenario assumes a conservative approach.
5. The forecast distribution to Safari shareholders comprising the aggregate of the section 25BB2 distributions and the
dividends paid to Safari shareholders.
6. This amount is the forecast dividend payments to Safari shareholders. Safari will be paying dividends from historical
Safari retained income. Historically Safari didn’t make any distributions to Safari shareholders and as at 30
September 2013 the retained income balance as reflected in the Safari statement of financial position included in
annexure 10 of this pre-listing statement amounted to R255 755 912.
7. The section 28BB2 distribution per share calculated by dividing R104 579 956 by 162 864 827 Safari shares in issue.
8. The forecast earnings and headline earnings per share for the financial years ending 31 March 2014 and 31 March
2015 on the assumption that 42 million new Safari shares are issued at an issue price of R7.52 per Safari share
raising approximately R315 million.
9. The forward yield per Safari share in issue expressed as a % calculated by dividing the forecast distribution per
Safari share by the issue price per Safari share.
10. Assumes 53.2 million new Safari shares are issued at an issue price of R7.52 per Safari share raising approximately
R400 million.
11. The forecast distribution to Safari shareholders comprising the aggregate of the section 25BB2 distributions and the
dividends paid to Safari shareholders.
12. The forecast dividend payment by Safari to Safari shareholders from historical Safari retained income. As at 30
September 2013 the retained income balance as reflected in the Safari statement of financial position included in
annexure 10 of the pre-listing statement amounted to R255 755 912.
13. The section 28BB2 distribution per share calculated by dividing R104 579 956 by 174 064 827 Safari shares in issue.
14. The forecast earnings and headline earnings per share for the financial years ending 31 March 2014 and 31 March
2015 on the assumption that 53.2 million new Safari shares are issued at an issue price of R7.52 per Safari share
raising approximately R400 million.
15. The forward yield per Safari share in issue expressed as a % calculated by dividing the forecast distribution per
Safari share by the issue price per Safari share.
Pro forma statement of financial position information*
Capital raised R315 million R400 million
Number of shares in issue 162 864 8271 174 064 8272
Net asset value per share3 761 760
Net tangible asset value per 762
763
share
*Assumes the Private Placing took place as at 31 March 2014.
Notes:
1. 162 864 827 Safari shares will be in issue if Safari raises R315 million by way of an issuance of 42 000 000 new
Safari shares at R7.52 per Safari share;
2. 174 064 827 Safari shares will be in issue if Safari raises R400 million by way of an issuance of 53 200 000 new
Safari shares at R7.52 per Safari share; and
3. The respective net asset value per share based on the scenarios as described in notes 1 and 2 above.
RATIONALE FOR THE LISTING:
- provide qualifying investors with an opportunity to participate over the long-term in the income streams and future capital growth
of Safari;
- obtain an increased spread of shareholders to enhance the liquidity and trade-ability of the shares;
- provide Safari with access to a central trading facility thereby providing liquidity to shareholders;
- provide Safari with access to capital markets and a platform to raise funding to pursue growth and investment opportunities in the
future; and
- enhance the public profile and general awareness of Safari.
PURPOSE OF THIS ABRIDGED PRE-LISTING STATEMENT
- provide investors with relevant information relating to the company, property portfolio, directors and property managers;
- communicate the strategy and vision of the company;
- undertake the private placing of between 42 million and 53.2 million shares with investors; and
- set out the salient details of the offer and the procedure for participating therein.
The net proceeds of the private placement will be used by Safari to settle interest bearing debt and strengthen the balance sheet for ongoing
activities. The ABSA facility of R600 million will then be used to fund the development pipeline.
SALIENT DATES AND TIMES1
The following table provides the expected dates of certain important events related to the Offer:
2014
Abridged Pre-Listing Statement released on SENS Monday, 31 March
Abridged Pre-Listing Statement published in the press Tuesday, 1 April
Opening date of the private placement (9:00) Monday, 31 March
Closing date of the private placement (12:00)2 Wednesday, 2 April
Results of the private placement released on SENS Wednesday, 2 April
Notification of allotments to successful invited investors Wednesday, 2 April
Results of the private placement published in the press Thursday, 3 April
Listing of shares and the commencement of trading on the JSE (9:00) Monday, 7 April
Accounts at CSDP or broker updated and credited in respect of dematerialised shareholders 3 Monday, 7 April
Notes:
(1) All references to dates and time are to local dates and times in South Africa. These dates and times are subject to amendment. Any
such amendment will be released on SENS and published in the press.
(2) Invited investors must advise their CSDP or broker of their acceptance of the private placement in the manner and cut-off time stipulated
by their CSDP or broker.
(3) CSDPs effect payment on a delivery-versus-payment basis.
PARTICULARS OF THE PRIVATE PLACEMENT
Amount to be raised in terms of the offer Between R315 million and R400 million
Number of private placement shares Between 42 million and 53.2 million
Indicative issue price per private placement R7.52
- The private placement shares issued in terms of this pre-listing statement will be allotted subject to the provisions of the MOI and will
rank pari passu in all respects including distributions, with all existing issued shares in the company.
- There are no convertibility or redemption provisions relating to any shares.
- Only no par value shares will be issued as provided for in the MOI.
- The private placement shares will only be issued in dematerialised form. No certificated private placement shares will be issued.
- No fractions of private placement shares will be offered in terms of the private placement. Any excess funds received from applicants
resulting from fractional entitlements will be refunded.
- The directors will not increase the number of shares offered in terms of the private placement.
- No share has any special rights to dividends, capital or profits of the company.
- There will be no other classes of shares authorised or in issue by Safari at the date of listing.
- There are no shares held in treasury.
CONDITIONS TO THE LISTING
The listing is subject to the achievement of a spread of shareholders acceptable to the JSE, being a minimum of 300 public shareholders.
Safari expects to meet these requirements after the private placement.
The offer and listing are conditional on obtaining the minimum spread of shareholders required under the Listings Requirements failing which,
the private placing and any acceptance thereof shall not be of any force or effect and no person shall have a claim whatsoever against the
company or any other person as a result of the failure of such condition.
DIRECTORS
Name, age and nationality* Business address Qualifications and occupation Capacity
Dr Molupe Hendrik Tsolo 3523 Taylorpark, Zamdela, BSC, MB.CHB, Accounting Independent non-executive
70 Sasolburg diploma chairman
Medical Doctor
Francois Jakobus Joubert 420 Friesland Avenue B. Arch Chief executive officer
Marais Lynnwood, Pretoria Architect
73
Dr Petrus Arnoldus Pienaar 420 Friesland Avenue, M Engineering, PHD Executive director
57 Lynnwood, Pretoria
Kyriacos Pashiou 453 Johannes Ramakgoase National Diploma in Construction Executive director
58 Street, Arcadia, Pretoria Management
Building Contractor
Daniel Elardus van Straten DVS suite, 1st floor, 2 Landros CA (SA) Executive financial director
64 street, Rustenburg Chartered Accountant
Allan Edward Wentzel 4 Gremlin Road, Bryanston CA (SA) Independent non-executive
75 Chartered Accountant director
Dr Jacobus Phillipus Snyman 3rd Floor, Medical Centre, 102 B. Ch. D Independent non-executive
62 Kock Street, Rustenburg Dentist director
Johannes Coenradus Verwayen 275 Thatchers Field, Lynnwood, B.Sc. (Q.S.) Non-independent non-executive
60 Pretoria Quantity Surveyor director
Dr Mark Minnaar Pretoria Ooginstituut, Suite 235, Mb ChB, Diploma Non-independent non-executive
45 630 Schoeman Street, Arcadia, Anesthesiology, FCS (SA) director
Pretoria Opthalmologist
Stephanus Johannes Kruger 98 Beyers Naude Drive, B Com, ILPA Non-independent non-executive
54 Rustenburg Financial Planner director
*All the directors are South African
AVAILABILITY OF THE PRE-LISTING STATEMENT
A copy of the pre-listing statement dated 28 March 2014 is available on the company’s website, www.safari-investments.com.
The pre-listing statement is available in English only. Copies of the pre-listing statement may be obtained from the registered offices of
Safari, the transfer secretaries, the sponsor and attorneys, details of which are set out in the “Corporate information” section of the pre-listing
statement.
31 March 2014
Pretoria
Lead bookrunner and advisor: DEA-RU
Sponsor and joint bookrunner: PSG Capital
Joint advisor and bookrunner: FKC
Attorneys: Edward Nathan Sonnenbergs
Auditors and reporting accountants: Mazars
Independent valuer: Mills Fitchet TVL
Communications advisor: Instinctif
Date: 31/03/2014 09:08:00 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.
Sharenet Sites 
