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Posting of circulars and firm intention of Octodec to acquire the entire linked unit capital of Premium
Octodec Investments Limited
(Incorporated in the Republic of South Africa)
(Registration number 1956/002868/06)
Share Code: OCT
ISIN Code: ZAE000005104
(“Octodec”)
REIT status approved
Premium Properties Limited
(Incorporated in the Republic of South Africa)
(Registration number 1994/003601/06)
Share Code: PMM
ISIN Code: ZAE000009254
(“Premium”)
REIT status approved
Posting of circulars and additional information pertaining to the firm intention of Octodec to acquire
the entire linked unit capital of Premium that it does not already own (“the Proposed Transaction”)
1. Posting of circulars
Further to the firm intention announcement that was released on the stock exchange news service
(“SENS”) of the JSE Limited on 10 June 2014 (“Firm Intention Announcement”) regarding the
Proposed Transaction and the proposed capital restructure of Octodec (“Octodec Capital
Restructure”), linked unitholders of Octodec (“Octodec linked unitholders”) and linked unitholders of
Premium (“Premium linked unitholders”) (collectively, “linked unitholders”) are advised that the
following documentation has been posted today, 1 July 2014:
- the circular to Octodec linked unitholders (“Octodec Circular”), including revised listing
particulars, the notices of the general meetings of Octodec shareholders and Octodec debenture
holders (“the Octodec General Meetings”) to be convened for the purposes of, inter alia,
approving the Proposed Transaction and the Octodec Capital Restructure, the forms of proxy and
a form of surrender and transfer; and
- the circular to Premium linked unitholders (“Premium Circular”), including the notice of the
general meeting of Premium linked unitholders (“the Scheme Meeting”) to be convened for the
purposes of, inter alia, approving the scheme of arrangement in terms of section 114(1)(d) of the
Companies Act, 2008 (No. 71 of 2008), as amended (“the Scheme”), proposed by the
independent board of directors of Premium between Premium and Premium linked unitholders,
in terms of which the Proposed Transaction will be effected, the form of proxy and a form of
surrender and transfer.
The Octodec Circular will be available on the Octodec website (www.octodec.co.za) and the
Premium Circular will be available on the Premium website (www.premiumproperties.co.za) from
today, 1 July 2014.
2. Indicative support
Premium linked unitholders holding or controlling, directly and indirectly, 26 965 562 Premium
linked units, comprising approximately 30.8% of Premium linked units able to vote at the Scheme
Meeting, have provided letters of support to vote in favour of the Scheme. The Wapnick Family
which holds 29.9% of Premium linked units are precluded from voting on the Scheme in terms of
section 115(4) of the Companies Act, but are fully supportive thereof.
Octodec linked unitholders holding or controlling, directly and indirectly, 71 195 453 Octodec linked
units, comprising approximately 60.7% of the Octodec linked units able to vote at the Octodec
General Meetings, have provided letters of support to vote in favour of the Proposed Transaction.
Further details relating to the abovementioned letters of support are contained in the Octodec and
Premium Circulars.
3. Financial information
3.1. Pro forma financial effects for Premium
Linked unitholders are advised that the pro forma financial information of Premium, as included in
the Firm Intention Announcement, has been adjusted pursuant to the review process by the
independent reporting accountants, and a summary of the reviewed pro forma financial information
of Premium as included in the Premium Circular is presented in the table below.
The information presented in the table below is a summary of the pro forma financial effects of the
Proposed Transaction on Premium’s earnings, headline earnings, distributable earnings, net asset
value (“NAV”) and tangible net asset value (“TNAV”) per linked unit (“Premium Pro Formas”) that has
been summarised from the pro forma statement of financial position and statement of
comprehensive income of Premium as included in the Premium Circular.
The Premium Pro Formas are the responsibility of the Premium Board and have been presented for
illustrative purposes only, to provide information to Premium linked unitholders on how the
implementation of the Proposed Transaction may have impacted on Premium linked unitholders had
the transaction been effected on 28 February 2014 for statement of financial position purposes and
1 September 2013 for statement of comprehensive income purposes. Because of their nature, the
Premium Pro Formas may not fairly present the effect of the Proposed Transaction on Premium’s
linked unitholders.
The Premium Pro Formas are based on Premium’s reviewed results for the six months ended 28
February 2014 and have been prepared in accordance with Premium’s accounting policies and in
compliance with IFRS.
Before Proposed After Proposed Change (%)
(1) (2) (3)
Transaction Transaction
NAV and TNAV per linked unit /
2 010.4 2 385.2 18.6%
share (cents)
Distributable earnings per linked 84.5 94.0 11.2%
unit (cents)
Diluted distributable earnings per
84.5 92.0 8.9%
linked unit / share (cents)
Basic earnings per linked unit
(4) 79.3 494.9 524.1%
/share (cents)
Diluted earnings per linked unit /
(4) 79.3 484.1 510.5%
share (cents)
Headline earnings per linked unit
(4) 87.8 173.0 97.0%
/ share (cents)
Diluted headline earnings per
(4) 87.8 169.2 92.7%
linked unit / share (cents)
Weighted average number of
linked units / shares in issue 156 773 231 262 47.5%
(‘000)
Number of linked units / shares in
156 773 236 403 50.8%
issue (‘000)
The “Before Proposed Transaction” and “After Proposed Transaction” column above are not
comparable for a Premium linked unitholder because the “After Proposed Transaction” column has
not been adjusted for the swap ratio of 88.5 Octodec linked units per 100 Premium linked units held
by a Premium linked unitholder (“the Swap Ratio”). The table below illustrates the comparable NAV,
TNAV and distributable earnings per linked unit after the Swap Ratio has been applied.
Before Proposed After Proposed Change (%)
(1) (2) (3)
Transaction Transaction
NAV and TNAV per linked unit /
2 010.4 2 110.9 5.0%
share (cents)
Distributable earnings per linked
84.5 83.2 (1.5%)
unit (cents)
Diluted distributable earnings per
84.5 81.4 (3.7%)
linked unit / share (cents)
Notes and assumptions:
Linked unitholders are referred to the pro forma financial information contained in the Premium
Circular for all assumptions on which the Premium Pro Formas have been derived.
1. The "Before Proposed Transaction" column has been reviewed by Grant Thornton, and an
unmodified review conclusion was issued.
2. The pro forma statement of comprehensive income is prepared on the basis that the Proposed
Transaction took place on 1 September 2013.
3. The pro forma statement of financial position is prepared on the basis that the Proposed
Transaction took place on 28 February 2014.
4. The undiluted and diluted “After Proposed Transaction” earnings and headline earnings per
linked unit are not comparable to the undiluted and diluted “Before Proposed Transaction”
earnings and headline earnings per linked unit, respectively, because they have been adjusted for
once-off items of a capital nature that are not distributable to Premium linked unitholders, such
as the gain on acquisition of subsidiary and reversal of deferred tax.
5. There are no other post balance sheet events which would result in an adjustment for purposes
of the Premium Pro Formas.
3.2. Pro forma financial effects for Octodec
The summary of the reviewed pro forma financial information of Octodec as included in the Octodec
Circular was included in the Firm Intention Announcement.
3.3. Forecast financial information
The summary of the reviewed forecast statements of comprehensive income of Octodec and
Premium as included in the Octodec Circular were included in the Firm Intention Announcement.
4. Salient dates and times
The salient dates and times relevant to the Proposed Transaction were included in the Firm Intention
Announcement. Premium linked unitholders are advised that the time of the general meeting of
Premium linked unitholders has been amended and it will now commence at 13h00 on Thursday, 31
July 2014.
Pretoria
1 July 2014
Investment Bank, Corporate Advisor and Sponsor to Octodec and Premium
Nedbank Capital
Legal adviser to Octodec and Premium
Tugendhaft Wapnick Banchetti and Partners
Independent reporting accountants to Octodec and Premium
Deloitte & Touche
Date: 01/07/2014 04:11:00 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.
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