Wrap Text
Posting of circular, notice of general meetings and scheme meetings
ASCENSION PROPERTIES LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2006/026141/06)
JSE share code: AIA ISIN: ZAE000161881
JSE share code: AIB ISIN: ZAE000161899
(Approved as a REIT by the JSE)
(“Ascension” or “the company”)
POSTING OF CIRCULAR, NOTICES OF A COMBINED LINKED UNITHOLDERS GENERAL MEETING, AN “A” LINKED UNITHOLDERS GENERAL MEETING, A “B” LINKED
UNITHOLDERS GENERAL MEETING, AN “A” DEBENTURE HOLDERS SCHEME MEETING, A “B” DEBENTURE HOLDERS SCHEME MEETING, A COMBINED ORDINARY
SHAREHOLDERS GENERAL MEETING, AN “A” ORDINARY SHAREHOLDERS GENERAL MEETING AND A “B” ORDINARY SHAREHOLDERS GENERAL MEETING
1. INTRODUCTION
Linked unitholders are advised that the company has on Friday, 22 May 2015 posted a circular to linked unitholders (the
“circular”) relating to:
- the conversion of the company’s current “A” linked unit capital structure to an “A” ordinary share structure by:
- the delinking of each “A” ordinary share from an “A” debenture;
- the cancellation of each “A” debenture and concomitant waiver, for no consideration, by the “A” debenture
holders of their right to be repaid the debt reflected in each “A” debenture or to receive any other form of
compensation;
- the capitalisation of the value allocated to each “A” debenture in the books of account of the company,
equating to the issue price of each “A” debenture, to Ascension’s stated capital account; and
- termination of the Debenture Trust Deed,
to be effected by way of a scheme of arrangement in terms of section 114 of the Companies Act, 71 of 2008 (the
“Companies Act”) which scheme is being proposed by the company between the company and its “A” debenture
holders (the ““A” debenture scheme”);
- the conversion of the company’s current “B” linked unit capital structure to a “B” ordinary share structure by:
- the delinking of each “B” ordinary share from a “B” debenture;
- the cancellation of each “B” debenture and concomitant waiver, for no consideration, by the “B” debenture
holders of their right to be repaid the debt reflected in each “B” debenture or to receive any other form of
compensation;
- the capitalisation of the value allocated to each “B” debenture in the books of account of the company,
equating to the issue price of each “B” debenture, to Ascension’s stated capital account; and
- termination of the Debenture Trust Deed,
to be effected by way of a scheme of arrangement in terms of section 114 of the Companies Act, which scheme is
being proposed by the company between the company and its “B” debenture holders (the ““B” debenture
scheme”);
- the amendment of Ascension’s Debenture Trust Deed to enable the schemes;
- the adoption of a new Memorandum of Incorporation to give effect to the change in Ascension’s capital structure;
and
- the subsequent termination of Ascension’s Debenture Trust Deed,
(collectively the “transactions”).
The circular contains:
- a notice convening a combined linked unitholders general meeting, to be held at 09:30;
- a notice convening an “A” linked unitholders general meeting, to be held at the later of 09:45 or 5 minutes after the
completion of the combined linked unitholders general meeting;
- a notice convening a “B” linked unitholders general meeting, to be held at the later of 10:00 or 5 minutes after the
completion of the “A” linked unitholders general meeting;
- a notice convening an “A” debenture holders scheme meeting, to be held at the later of 10:15 or 5 minutes after the
completion of the “B” linked unitholders general meeting;
- a notice convening a “B” debenture holders scheme meeting, to be held at the later of 10:30 or 5 minutes after the
completion of the “A” debenture holders scheme meeting;
- a notice convening a combined ordinary shareholders meeting, to be held at the later of 10:45 or 5 minutes after the
completion of the “B” debenture holders scheme meeting;
- a notice convening an “A” ordinary shareholders general meeting to be held at the later of 11:00 or 5 minutes after
the completion of the combined ordinary shareholders general meeting; and
- a notice convening a “B” ordinary shareholders general meeting to be held at the later of 11:15 or 5 minutes after
the completion of the “A” ordinary shareholders general meeting,
on Tuesday, 23 June 2015 at the registered office of Ascension, 25th Floor, 9 Riebeeck Street, Cape Town, 8001, for the
purposes of considering and, if deemed fit, passing, with or without modification, the resolutions required to approve the
transactions, including the “A” debenture scheme and the “B” debenture scheme (collectively the “schemes”).
The circular is also available in electronic format on the company’s website at www.ascensionproperties.co.za.
2. RATIONALE
Retention of Ascension’s REIT status under the JSE Listings Requirements
In terms of the revised section 13 of the JSE Listings Requirements (which has been amended to cater for REIT legislation)
the total consolidated IFRS liabilities of a REIT may not exceed 60% of its total consolidated IFRS assets. The liability
constituted by a company’s issued debentures is (in terms of IFRS) required to be taken into account in the calculation for
the determination of such 60% threshold.
By converting its capital structure, Ascension will, by virtue of the cancellation of its issued debentures, further reduce the
ratio of its total consolidated liabilities to total consolidated assets from 77.73% to 41.53% (calculated as at the last
practicable date with reference to the company’s unaudited interim results for the six months ended 31 December 2014).
This will ensure that the company’s consolidated liabilities remain below the aforementioned 60% threshold requirement
and will also provide the company with greater flexibility to take on additional debt should the need arise, and thus allow
the company to pursue an acquisitive growth strategy whilst limiting potential shareholder dilution.
Additional benefits for a capital conversion of Ascension
Additional benefits in converting the company’s current linked unit capital structure to an all share structure are to -
- align the company’s capital structure with the internationally recognised all equity REIT capital structures;
- simplify the administration and accounting treatment of the company’s capital structure as there is greater clarity on
the tax treatment of distributions and the equity nature of the securities of the company; and
- remove the cost structure associated with debentures.
As announced on SENS on 24 February 2015, Rebosis Property Fund Limited (“Rebosis”) intends acquiring the entire
issued linked unit capital of Ascension by way of:
- a scheme of arrangement in terms of section 114 of the Companies Act between Ascension and Ascension “A”
linked unitholders, in terms of which, if implemented, Rebosis will acquire the entire issued “A” linked unit capital
of Ascension that Rebosis does not already own in exchange for 19.34236 Rebosis A ordinary shares for every 100
Ascension A linked units held (the “A unit Rebosis scheme”);
- a scheme of arrangement in terms of section 114 of the Companies Act between Ascension and Ascension “B”
linked unitholders, in terms of which, if implemented, Rebosis will acquire the entire issued “B” linked unit capital
of Ascension that Rebosis does not already own in exchange for 23.54900 Rebosis ordinary shares for every 100
Ascension B linked units held (the “B unit Rebosis scheme”).
To this end, circulars dated 22 April 2015 have been issued to each of Ascension A linked unitholders in respect of the A
unit Rebosis scheme and Ascension B linked unitholders in respect of the B unit Rebosis scheme.
As detailed in those circulars, -
- the A unit Rebosis scheme is conditional upon the approval and implementation of the B unit Rebosis scheme;
- however, the B unit Rebosis scheme is not conditional upon the approval or implementation of the A unit Rebosis
scheme,
with the result that -
- if the B unit Rebosis scheme is not approved or implemented, Rebosis will not acquire any Ascension “A” or “B”
linked units and Ascension will be required to retain its REIT status in order to avail itself of the tax treatment
afforded to REITs;
- if both the A unit Rebosis scheme and the B unit Rebosis scheme are approved and implemented, all of the
Ascension “A” and “B” linked units will be –
- acquired by Rebosis; and subsequently
- delisted from the JSE.
This will result in Ascension no longer qualifying as a REIT (because its shares will no longer be listed on the JSE)
but instead Ascension will become a subsidiary of Rebosis, which is a REIT, and thus Ascension will be regarded as
a “controlled company” under section 25BB(1) of the Income Tax Act;
- if the B unit Rebosis scheme is approved and implemented and the A unit Rebosis scheme is not, all of the
Ascension “B” linked units will be acquired by Rebosis, with the intention that the company remains listed on the
JSE as a REIT and thus should seek to retain its REIT status.
In light of the above, the board now proposes converting the linked unit structure of Ascension to a pure equity, share-only
structure. In order to achieve this, the board proposes that:
- the “A” debenture scheme be implemented such that the “A” debenture portion of the “A” linked unit is cancelled
leaving an “A” ordinary share and the Debenture Trust Deed is automatically terminated; and
- the “B” debenture scheme be implemented such that the “B” debenture portion of the “B” linked unit is cancelled
leaving a “B” ordinary share and the Debenture Trust Deed is automatically terminated.
3. CONDITIONS PRECEDENT TO THE “A” DEBENTURE SCHEME
The “A” debenture scheme will be subject to the following conditions precedent:
- the approval of the “A” debenture scheme by the requisite majority of “A” debenture holders at the “A” debenture
holders scheme meeting, as contemplated in section 115(2) of the Companies Act;
- to the extent required, the approval of the implementation of such resolution by the Court as contemplated in section
115(3)(a) of the Companies Act; and
- if applicable, the company not treating the aforesaid resolution as a nullity, as contemplated in section 115(5)(b) of
the Companies Act;
- the requisite majority of “A” and “B” linked unitholders collectively approving the relevant resolutions required to
authorise:
- the amendment of the Debenture Trust Deed;
- the delinking of each of the company’s “A” ordinary shares from an “A” debenture so as to no longer
constitute an “A” linked unit;
- the delinking of each of the company’s “B” ordinary shares from a “B” debenture so as to no longer
constitute a “B” linked unit; and
- the termination of the Debenture Trust Deed, without payment or other compensation to “A” debenture
holders or “B” debenture holders,
at the combined linked unitholders general meeting;
- the requisite majority of “A” linked unitholders approving the relevant resolutions required to authorise:
- the amendment of the Debenture Trust Deed;
- the delinking of each of the company’s “A” ordinary shares from an “A” debenture so as to no longer
constitute an “A” linked unit;
- the delinking of each of the company’s “B” ordinary shares from a “B” debenture so as to no longer
constitute a “B” linked unit; and
- the termination of the Debenture Trust Deed, without payment or other compensation to “A” debenture
holders or “B” debenture holders,
at the “A” linked unitholders general meeting;
- the requisite majority of “A” and “B” ordinary shareholders collectively approving the relevant resolutions required
to authorise the adoption of a new Memorandum of Incorporation at the combined ordinary shareholders general
meeting;
- the requisite majority of “A” ordinary shareholders approving the relevant resolutions required to authorise the
adoption of a new Memorandum of Incorporation at the “A” ordinary shareholders general meeting;
- in respect of the new Memorandum of Incorporation, no shareholder exercises its dissenting shareholder appraisal
rights in terms of section 164 of the Companies Act;
- the fulfilment (and/or waiver) of the conditions precedent to the “B” debenture scheme, save for any condition
precedent to the “B” debenture scheme in terms of which the conditions precedent to the “A” debenture scheme are
required to be fulfilled (and/or waived); and
- all applicable regulatory and statutory approvals are obtained.
The conditions precedent have been inserted in the company’s favour. If a condition precedent is capable of being waived,
the company may waive such condition, in its sole discretion, at any time prior to the fulfilment thereof.
4. CONDITIONS PRECEDENT TO THE “B” DEBENTURE SCHEME
The “B” debenture scheme will be subject to the following conditions precedent:
- the approval of the “B” debenture scheme by the requisite majority of “B” debenture holders at the “B” debenture
holders scheme meeting, as contemplated in section 115(2) of the Companies Act;
- to the extent required, the approval of the implementation of such resolution by the Court as contemplated in section
115(3)(a) of the Companies Act; and
- if applicable, the company not treating the aforesaid resolution as a nullity, as contemplated in section 115(5)(b) of
the Companies Act;
- the requisite majority of “A” and “B” linked unitholders collectively approving the relevant resolutions required to
authorise:
- the amendment of the Debenture Trust Deed;
- the delinking of each of the company’s “A” ordinary shares from an “A” debenture so as to no longer
constitute an “A” linked unit;
- the delinking of each of the company’s “B” ordinary shares from a “B” debenture so as to no longer
constitute a “B” linked unit; and
- the termination of the Debenture Trust Deed, without payment or other compensation to “A” debenture
holders or “B” debenture holders,
at the combined linked unitholders general meeting;
- the requisite majority of “B” linked unitholders approving the relevant resolutions required to authorise:
- the amendment of the Debenture Trust Deed;
- the delinking of each of the company’s “B” ordinary shares from an “A” debenture so as to no longer
constitute a “A” linked unit;
- the delinking of each of the company’s “B” ordinary shares from a “B” debenture so as to no longer
constitute a “B” linked unit; and
- the termination of the Debenture Trust Deed, without payment or other compensation to “A” debenture
holders or “B” debenture holders,
at the “B” linked unitholders general meeting;
- the requisite majority of “A” and “B” ordinary shareholders collectively approving the relevant resolutions required
to authorise the adoption of a new Memorandum of Incorporation at the combined ordinary shareholders general
meeting;
- the requisite majority of “B” ordinary shareholders approving the relevant resolutions required to authorise the
adoption of a new Memorandum of Incorporation at the “B” ordinary shareholders general meeting;
- in respect of the new Memorandum of Incorporation, no shareholder exercises its dissenting shareholder appraisal
rights in terms of section 164 of the Companies Act;
- the fulfilment (and/or waiver) of the conditions precedent to the “A” debenture scheme, save for any condition
precedent to the “A” debenture scheme in terms of which the conditions precedent to the “B” debenture scheme are
required to be fulfilled (and/or waived); and
- all applicable regulatory and statutory approvals are obtained.
The conditions precedent have been inserted in the company’s favour. If a condition precedent is capable of being waived,
the company may waive such condition, in its sole discretion, at any time prior to the fulfilment thereof.
5. SECTION 114 REPORTS
The board has appointed Mazars Corporate Finance Proprietary Limited (the “independent expert”) as the independent
expert (which meets the requirements set out in section 114(2) of the Companies Act) to advise it on the proposed “A”
debenture scheme and the proposed “B” debenture scheme and to compile a report in terms of section 114 of the
Companies Act to the independent board concerning each of the schemes.
The independent expert has prepared reports to the board in compliance with section 114(3) of the Companies Act, each of
which report confirms that the “A” debenture scheme and the “B” debenture scheme are fair and reasonable to Ascension’s
debenture holders. The independent expert’s reports are included in the circular.
6. VIEWS OF THE BOARD
None of the directors have any conflict of interests in relation to the schemes and all directors are able to make impartial
decisions in relation to the schemes. Accordingly, all directors are considered to be “independent” (as defined under
Regulation 81 of the Takeover Regulations).
The board, having considered the terms and conditions of the schemes, is in favour of the schemes and the transactions and
recommends that linked unitholders vote in favour of the resolutions set out in the notices convening the combined linked
unitholders general meeting, the “A” linked unitholders general meeting, the “B” linked unitholders general meeting, the
“A” debenture holders scheme meeting, the “B” debenture holders scheme meeting, the combined ordinary shareholders
general meeting, the “A” ordinary shareholders general meeting and the “B” ordinary shareholders general meeting
(collectively the “meetings”), to implement the schemes and the transactions.
The directors of the company who hold linked units intend to vote in favour of the resolutions set out in the notices
convening the meetings, to implement the schemes and the transactions.
7. SALIENT DATES AND TIMES
The salient dates and times relating to the transactions are as set out below.
2015
Record date to receive this circular (together with the notices convening the meetings) Friday, 15 May
Circular (together with the notices convening the meetings) posted Friday, 22 May
Announcement relating to the issue of the circular (together with the notices convening the
meetings) released on SENS Friday, 22 May
Announcement relating to the issue of the circular (together with the notices convening the
meetings) published in the press Monday, 25 May
Last day to trade in order to be eligible to vote at the meetings Friday, 5 June
Voting record date Friday, 12 June
Last day to lodge forms of proxy for the combined linked unitholders general meeting (by 09:30) Friday, 19 June
Last day to lodge forms of proxy for the “A” linked unitholders general meeting (by 09:45) Friday, 19 June
Last day to lodge forms of proxy for the “B” linked unitholders general meeting (by 10:00) Friday, 19 June
Last day to lodge forms of proxy for the “A” debenture holders scheme meeting (by 10:15) Friday, 19 June
Last day to lodge forms of proxy for the “B” debenture holders scheme meeting (by 10:30) Friday, 19 June
Last day to lodge forms of proxy for the combined ordinary shareholders general meeting (by
10:45) Friday, 19 June
Last day to lodge forms of proxy for the “A” ordinary shareholders general meeting (by 11:00) Friday, 19 June
Last day to lodge forms of proxy for the “B” ordinary shareholders general meeting (by 11:15) Friday, 19 June
Last day for Ascension shareholders to give notice of their objections to the adoption of the new
Memorandum of Incorporation by no later than 10:45 or 5 minutes after the completion of the
“B” debenture holders scheme meeting, whichever is the later Tuesday, 23 June
Combined linked unitholders general meeting held at 09:30 Tuesday, 23 June
“A” linked unitholders general meeting held at the later of 09:45 or 5 minutes after the
completion of the combined linked unitholders general meeting Tuesday, 23 June
“B” linked unitholders general meeting held at the later of 10:00 or 5 minutes after the
completion of the “A” linked unitholders general meeting Tuesday, 23 June
“A” debenture holders scheme meeting held at the later of 10:15 or 5 minutes after the
completion of the “B” linked unitholders general meeting Tuesday, 23 June
“B” debenture holders scheme meeting held at the later of 10:30 or 5 minutes after the completion
of the “A” debenture holders scheme meeting Tuesday, 23 June
Combined ordinary shareholders general meeting held at the later of 10:45 or 5 minutes after the
completion of the “B” debenture holders scheme meeting Tuesday, 23 June
“A” ordinary shareholders general meeting held at the later of 11:00 or 5 minutes after the
completion of the combined ordinary shareholders general meeting Tuesday, 23 June
“B” ordinary shareholders general meeting held at the later of 11:15 or 5 minutes after the
completion of the “A” ordinary shareholders general meeting Tuesday, 23 June
Results of the meetings released on SENS Tuesday, 23 June
Special resolutions submitted to CIPC for filing Wednesday, 24 June
Results of the meetings published in the press Wednesday, 24 June
Last date on which “A” debenture holders who voted against the “A” debenture scheme can
require the company to seek court approval in terms of section 115(3)(a) of the Companies Act, if
the “A” debenture scheme is approved by “A” debenture holders at the “A” debenture scheme
meeting but at least 15% of the votes are voted against the “A” debenture scheme Tuesday, 30 June
Last date on which “B” debenture holders who voted against the “B” debenture scheme can
require the company to seek court approval in terms of section 115(3)(a) of the Companies Act, if
the “B” debenture scheme is approved by “B” debenture holders at the “B” debenture scheme
meeting but at least 15% of the votes are voted against the “B” debenture scheme Tuesday, 30 June
Last date for “A” debenture holders who voted against the “A” debenture scheme to be granted
leave by a court to apply for a review of the“A” debenture scheme in terms of section 115(3)(b) of
the Companies Act, if the “A” debenture scheme is approved by “A” debenture holders at the “A”
debenture holders scheme meeting Tuesday, 7 July
Last date for “B” debenture holders who voted against the “B” debenture scheme to be granted
leave by a court to apply for a review of the“B” debenture scheme in terms of section 115(3)(b)
of the Companies Act if the “B” debenture scheme is approved by “B” debenture holders at the
“B” debenture holders scheme meeting Tuesday, 7 July
If no debenture holders exercise their rights in terms of section 115(3)(a) or section 115(3)(b) of
the Companies Act
Special resolutions expected to be registered by CIPC Wednesday, 8 July
Finalisation date expected to be Friday, 10 July
Finalisation date announcement expected to be released on SENS Friday, 10 July
Finalisation date announcement expected to be published in the press Monday, 13 July
Expected last day to trade in existing “A” linked units on the JSE prior to the delinking of the “A”
linked units and the capitalisation of the “A” debentures Friday, 17 July
Expected last day to trade in existing “B” linked units on the JSE prior to the delinking of the “B”
linked units and the capitalisation of the “B debentures Friday, 17 July
Trading in delinked “A” ordinary shares of no par value under the new ISIN: ZAE000204566 and
the existing code of “AIA” commences Monday, 20 July
Trading in delinked “B” ordinary shares of no par value under the new ISIN: ZAE000204574 and
the existing code of “AIB” commences Monday, 20 July
Expected suspension of listing of “A” linked units on the JSE Monday, 20 July
Expected suspension of listing of “B” linked units on the JSE Monday, 20 July
Expected scheme implementation record date for the delinking of the “A” linked units and the
capitalisation of the “A” debentures at the close of business Friday, 24 July
Expected scheme implementation record date for the delinking of the “B” linked units and the
capitalisation of the “B” debentures at the close of business Friday, 24 July
Expected scheme operative date Monday, 27 July
Expected date by which dematerialised “A” ordinary shareholders will have their accounts
updated at their CSDP or broker Monday, 27July
Expected date by which dematerialised “B” ordinary shareholders will have their accounts
updated at their CSDP or broker Monday, 27 July
Expected date of issue of new replacement share certificates provided that the old “A” linked unit
certificates have been surrendered by 12:00 on Friday, 24 July 2015 (any certificated “A” linked
units surrendered after this date will be replaced within five business days after receipt by the
transfer secretaries) Monday, 27 July
Expected date of issue of new replacement share certificates provided that the old “B” linked unit
certificates have been surrendered by 12:00 on Friday, 24 July 2015 (any certificated “B” linked
units surrendered after this date will be replaced within five business days after receipt by the
transfer secretaries) Monday, 27 July
Expected termination of listing of “A” linked units (at the commencement of trade) Monday, 27 July
Expected termination of listing of “B” linked units (at the commencement of trade) Monday, 27 July
Notes:
1. All dates and times may be changed by the company. Any change will be published on SENS and in the South African press.
2. Linked unitholders should note that as transactions in Ascension linked units are settled in the electronic settlement system used by Strate,
settlement of trades takes place five business days after such trade. Therefore, unitholders who acquire Ascension linked units after Friday,
5 June 2015 will not be eligible to vote at the linked unitholders general meetings, the debenture holders scheme meetings or the shareholders
general meetings.
3. All times given in this announcement are local times in South Africa.
4. If the combined linked unitholders general meeting, “A” linked unitholders general meeting, “B” linked unitholders general meeting, “A”
debenture holders scheme meeting, “B” debenture holders scheme meeting, combined ordinary shareholders general meeting, “A” ordinary
shareholders general meeting and/or “B” ordinary shareholders general meeting are adjourned or postponed, forms of proxy submitted for the
initial combined linked unitholders general meeting, “A” linked unitholders general meeting, “B” linked unitholders general meeting, “A”
debenture holders scheme meeting, “B” debenture holders scheme meeting, combined ordinary shareholders general meeting, “A” ordinary
shareholders general meeting and/or “B” ordinary shareholders general meeting, as the case may be, will remain valid in respect of any
adjournment or postponement of the combined linked unitholders general meeting, “A” linked unitholders general meeting, “B” linked
unitholders general meeting, “A” debenture holders scheme meeting, “B” debenture holders scheme meeting, combined ordinary shareholders
general meeting, “A” ordinary shareholders general meeting and/or “B” ordinary shareholders general meeting, as the case may be.
5. No dematerialisation of linked unit certificates may take place after Friday, 17 July 2015.
22 May 2015
Corporate advisor and sponsor
Java Capital
Independent expert
Mazars Corporate Finance (Pty) Ltd
Legal advisor
DLA Cliffe Dekker Hofmeyr
Date: 22/05/2015 04:45:00 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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