ANNUITY PROPERTIES LTD - Posting of Circular and Notice of Scheme Meeting

Release Date: 07/04/2014 15:00
Code(s): ANP RDF
 
Wrap Text
Posting of Circular and Notice of Scheme Meeting

ANNUITY PROPERTIES LIMITED                                REDEFINE PROPERTIES LIMITED
(Incorporated in the Republic of South Africa)            (Incorporated in the Republic of South Africa)
(Registration Number 2011/145994/06)                      (Registration number 1999/018591/06)
JSE share code: ANP        ISIN: ZAE000165643             JSE share code: RDF ISIN: ZAE000143178
(“Annuity”)                                               (“Redefine”)


POSTING OF CIRCULAR AND NOTICE OF SCHEME MEETINGS


1.    INTRODUCTION

      Holders of linked units of Annuity (“Annuity Linked Unitholders”) are referred to the joint firm intention
      announcement by Annuity and Redefine dated 7 March 2014 (“Firm Intention Announcement”), whereby
      Annuity Linked Unitholders were informed that:
      -    Annuity and Redefine had entered into an implementation agreement (the “Implementation
           Agreement”) in terms of which Redefine made an offer (the “Offer”) to acquire all the issued linked
           units of Annuity (“Annuity Linked Units”) from Annuity Linked Unitholders by way of one or more
           indivisibly inter-related schemes of arrangement (“Schemes”) in terms of sections 114 and 115 of the
           Companies Act 71 of 2008, as amended, (the "Companies Act"); and
      -    Redefine had entered into agreements with the shareholders of Annuity Asset Managers Proprietary
           Limited (“Annuity Asset Managers”) and Annuity Property Managers Proprietary Limited (“Annuity
           Property Managers”) to acquire all the ordinary shares in and shareholder claims against Annuity
           Asset Managers and Annuity Property Managers, on and with effect from the date of implementation
           of the Schemes (the "Manco Transaction")
      as one indivisible transaction (collectively, the “Proposed Transaction”).

      Annuity Linked Unitholders are informed that a circular (“Circular”) was posted to Annuity Linked
      Unitholders today (7 April 2014) containing, inter alia:
      -    details of the Proposed Transaction; and
      -    notices convening:
           -    the general meeting of holders of Annuity debentures (“Scheme Meeting of Annuity Debenture
                Holders”); and
           -    the general meeting of holders of Annuity ordinary shares (“Scheme Meeting of Annuity
                Shareholders”)
           (collectively, the “Scheme Meetings”).

      Annuity Linked Unitholders are informed that the Proposed Transaction is subject to the fulfilment of certain
      conditions precedent detailed in the Circular and are advised to review the Circular for a summary of the
      key terms and conditions of the Proposed Transaction. The Circular is also available on Annuity's website
      www.annuityproperties.co.za.

2.    NOTICE OF SCHEME MEETINGS

      The Scheme Meeting of Annuity Debenture Holders and the Scheme Meeting of Annuity Shareholders will
      be held at 29 Scott Street, Waverley, Sandton, 2090 on Tuesday, 13 May 2014 at 10:00 and 10:30 (or
      earlier if the Scheme Meeting of Annuity Debenture Holders is concluded earlier), respectively, to consider
      and, if deemed fit, pass, with or without modification, the resolutions necessary to implement the Proposed
      Transaction.

3.    IMPORTANT DATES AND TIMES

      The salient dates and times relating to the Schemes are set out in the timetable below (“Timetable”). Words
      and expressions in the Timetable and notes thereto shall have the same meaning as assigned to them in
      the Circular.

      Action                                                                                           2014

      Record date for Annuity Linked Unitholders to be recorded in the Register in
      order to receive this Circular                                                              Friday, 28 March

      Circular posted to Annuity Linked Unitholders and notice convening the
      Scheme Meetings published on SENS                                                            Monday, 7 April
      Notice convening the Scheme Meetings published in the South African press                    Tuesday, 8 April

      Last day to trade in Annuity Linked Units in order to be recorded in the Register
      to vote at the Scheme Meetings (see note 2 below)                                            Wednesday, 23 April

      Voting Record Date for Annuity Linked Unitholders to be recorded in the
      Register in order to be eligible to vote at the Scheme Meetings                              Friday, 2 May

      Forms of Proxy for the Scheme Meeting of Annuity Debenture Holders to be
      received by the Transfer Secretaries by 10:00 (see note 3 below) on                          Friday, 9 May

      Forms of Proxy for the Scheme Meeting of Annuity Shareholders to be received
      by the Transfer Secretaries by 10:00 (see note 3 below) on                                   Friday, 9 May

      Last date and time for Annuity Linked Unitholders to give notice to Annuity
      objecting to the Special Resolutions in terms of section 164 of the Companies
      Act by the time the Special Resolutions are voted on, on                                     Tuesday, 13 May

      Scheme Meeting of Annuity Debenture Holders held at 10:00 on                                 Tuesday, 13 May

      Scheme Meeting of Annuity Shareholders held at 10:30 (or so soon thereafter
      as the Scheme Meeting of Annuity Debenture Holders convened for 10:00 on
      the same day and at the same venue, shall have been concluded or adjourned)
      on                                                                                           Tuesday, 13 May

      Results of the Scheme Meetings published on SENS                                             Tuesday, 13 May

      Results of the Scheme Meetings published in the South African press                          Wednesday, 14 May

      If the Schemes are approved by Annuity Linked Unitholders at the Scheme
      Meetings:

      Last day for Annuity Linked Unitholders who voted against the Schemes to
      require Annuity to seek Court approval for the Schemes in terms of section
      115(3)(a) of the Companies Act (where applicable)                                            Tuesday, 20 May
 
      Last day for Annuity to send notice of adoption of the Special Resolutions to
      Dissenting Linked Unitholders, in accordance with section 164 of the
      Companies Act                                                                                Tuesday, 27 May

      Last day for an Annuity Linked Unitholder who voted against the Schemes to
      apply to Court for leave to apply for a review of the Schemes in terms of section
      115(3)(b) of the Companies Act                                                               Tuesday, 27 May

      The following dates assume that neither Court approvals nor the review of the
      Schemes is required and will be confirmed in the finalisation announcement if
      the Schemes become unconditional.

      Expected Fulfilment Date                                                                     Wednesday, 18 June

      Finalisation announcement expected to be published on SENS                                   Thursday, 19 June

      Finalisation announcement expected to be published in the South African press                Friday, 20 June

      Expected last day to trade in Annuity Linked Units in order to be recorded in the
      Register on the Scheme Record Date                                                           Friday, 27 June

      Expected date of suspension of listing of Annuity Linked Units on the JSE                    Monday, 30 June

      Expected Scheme Record Date on which Annuity Linked Unitholders must be
      recorded in the Register to receive the Scheme Consideration                                 Friday, 4 July
      Expected Operative Date of the Scheme                                                        Monday, 7 July

      Statements expected to be posted to Certificated Scheme Participants
      (provided their Form of Surrender and Transfer (pink) are received on or prior
      to 12:00 on the Scheme Record Date)                                                          Monday, 7 July

      Dematerialised Scheme Participants expected to have their accounts with their
      broker or CSDP credited with the Scheme Consideration on or about                            Monday, 7 July

      Expected termination of listing of Annuity Linked Units at commencement of
      trade on the JSE                                                                             Monday, 7 July



     1.    All dates and times in respect of the Schemes are (subject to the provisions of the Implementation
           Agreement) subject to change by mutual agreement between Annuity and Redefine and the approval
           of the JSE and, where required, the Takeover Regulation Panel. The dates have been determined
           based on assumptions regarding the dates by which certain regulatory approvals including, but not
           limited to, that of the Competition Authorities, will be obtained and that no Court approval or review of
           the Scheme will be required. Any change in the dates and times will be published on SENS and
           published in the South African press.
     2.    Annuity Linked Unitholders should note that as transactions in Annuity Linked Units are settled in the
           electronic settlement system used by Strate, settlement of trades takes place five Business Days after
           such trade. Therefore persons who acquire Annuity Linked Units after close of trade on Wednesday,
           23 April 2014 will not be eligible to vote at the Scheme Meetings. Provided the Schemes are approved
           and become operative, pursuant to the expected Fulfilment Date of 18 June 2014, Annuity Linked
           Unitholders who hold Annuity Linked Units on Friday, 27 June 2014 will participate in the Schemes
           (i.e. dispose of their Annuity Linked Units to Redefine in accordance with the Schemes for the
           Scheme Consideration).
     3.    A Certificated Annuity Linked Unitholder, a Dematerialised Annuity Linked Unitholder with “own name”
           registration and a Dematerialised Annuity Linked Unitholder without “own name” registration who has
           been issued with a letter or representation may submit a form of proxy at any time before the
           commencement of the Scheme Meetings (or adjourned or postponed Scheme Meetings) or hand it to
           the Chairman of the Scheme Meetings before the appointed proxy exercises any of the relevant
           Annuity Linked Unitholder rights at the Scheme Meetings (or adjourned or postponed Scheme
           Meetings), provided that should an Annuity Linked Unitholder lodge a form of proxy with the Transfer
           Secretaries less than 48 hours (excluding Saturdays, Sundays and official public holidays) before the
           Scheme Meetings, such Annuity Linked Unitholder will also be required to furnish a copy of such form
           of proxy to the Chairman of the Scheme Meetings before the appointed proxy/ies exercises any of
           such Annuity Linked Unitholder’s rights at the Scheme Meetings (or adjourned or postponed Scheme
           Meetings).
     4.    If the Scheme Meetings are adjourned or postponed, forms of proxy submitted for the initial Scheme
           Meetings will remain valid in respect of any adjournment or postponement of the Scheme Meetings.
     5.    All times given in this Circular are local times in South Africa.
     6.    If the Schemes become operative on Monday, 7 July 2014, Annuity Linked Units may not be
           Dematerialised or rematerialised after Friday, 27 June 2014.


4.    PRO FORMA EARNINGS AND NET ASSET VALUE EFFECTS RELATING TO ANNUITY LINKED
      UNITHOLDERS

      In terms of the Offer, Annuity Linked Unitholders participating in the Schemes will receive the Scheme
      Consideration, being 57.75200 Redefine linked units (“Redefine Linked Unit”) for every 100 Annuity Linked
      Units held by them on the Scheme Record Date.

      Based on the clean 30 day volume weighted average price ("VWAP") of Redefine Linked Units, the Scheme
      Consideration represents a premium of 9.3% to the clean VWAP of Annuity Linked Units traded on the
      securities exchange operated by the JSE Limited ("JSE") over the 30 business days up to and including the
      date on which the first cautionary announcement was released on SENS, being 12 December 2013.

      Based on the clean 5 day VWAP of Redefine Linked Units, the Scheme Consideration represents a
      premium of 5.9% to the clean 5 day VWAP of Annuity Linked Units traded on the JSE up to and including 6
      March 2014, being the last business day immediately prior to the date of the Firm Intention Announcement.
      Annuity Linked Unitholders will receive the distribution payable by Annuity for the 5 month distribution
      period to 28 February 2014. Annuity Linked Unitholders will become entitled, pursuant to the Schemes, to
      the Redefine income distribution from the periods commencing 1 March 2014.

      The pro forma financial effects of the Schemes for Annuity Linked Unitholders, for which only the Annuity
      Board is responsible, are provided for illustrative purposes only to provide information about how the
      Schemes may have affected Annuity Linked Unitholders, and because of their nature, may not fairly
      represent the effect on Annuity Linked Unitholders of the Schemes.

      The pro forma adjustments to the statement of comprehensive income have been calculated on the
      assumption that the operative date of the Schemes was on 1 October 2012, illustrating the effect of 100
      Annuity Linked Units being exchanged for 57.75200 Redefine Linked Units, and, for the purposes of the
      statement of financial position, as if the operative date of the Schemes was on 30 September 2013.

      Further to the pro forma financial effects included in the Firm Intention Announcement, the table below sets
      out the revised pro forma financial effects of the Proposed Transaction based on the 12 months results for
      Annuity to 30 September 2013:
 
                                                                   Before the          After the            Change
                                                                     Proposed           Proposed               % 
                                                                            1                   2
                                                                  Transaction        Transaction

     Basic earnings per linked unit (cents)                             84.94             112.55            32.5
     Diluted earnings per linked unit (cents)                           84.84             112.55            32.7
     Headline earnings per linked unit (cents)                          57.13              56.09            -1.8
     Diluted headline earnings per linked unit (cents)                  57.02              56.09            -1.6
     Distribution per linked unit (cents)                               43.90              39.77            -9.4
     Net asset value per linked unit (cents)                           520.00             503.85            -3.1
     Tangible net asset value per linked unit (cents)                  520.00             402.22           -22.7
     Weighted average number of linked units in issue                 232 383            134 206
     (‘000)
     Number of linked units in issue (‘000)                           232 383            134 206

     Notes and assumptions:

     1.   The financial information in the “Before the Proposed Transaction” column is based on the 12 month
          results for Annuity to 30 September 2013, as extracted from Annuity’s interim results for the six months
          ended 30 September 2013 added to the results per the financial statements for the 12 months ended
          31 March 2013, less the interim results for the six months ended 30 September 2012.
     2.   The financial information in the “After the Proposed Transaction” column is based on Redefine’s
          financial effects pursuant to the Proposed Transaction, details of which are set out in the Circular, and
          multiplying these results by 0.57752 to provide the pro forma financial effects for Annuity Linked
          Unitholders.
     3.   The detailed pro forma financial effects to Annuity Linked Unitholders and the notes thereto are set out
          in Annexure 5 to the Circular.
     4.   The independent reporting accountant’s limited assurance report on the pro forma financial effects
          relating to Annuity Linked Unitholders is set out in Annexure 4 to the Circular.


Illovo
7 April 2014

Lead Investment Bank and Transaction Sponsor to Annuity
Investec Bank Limited

Joint Investment Bank and Transaction Sponsor to Annuity
Sasfin Capital (A division of Sasfin Bank Limited)

Sponsor to Annuity
RAND MERCHANT BANK (A division of FirstRand Bank Limited)

Independent Expert to Annuity
Deloitte & Touche
Legal Advisor to Annuity
Edward Nathan Sonnenbergs Inc.

Reporting accountants to Annuity and Redefine
Grant Thornton

Sponsor and Corporate Advisor to Redefine
Java Capital

Legal Advisor to Redefine
DLA Cliffe Dekker Hofmeyr Inc.

Date: 07/04/2014 03:00:00 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.

Email this JSE Sens Item to a Friend.

Share This Story