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Announcement regarding the acquisition of Great Westerford
INGENUITY PROPERTY INVESTMENTS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2000/018084/06)
ISIN: ZAE 000127411 JSE share code: ING
(“Ingenuity” or “the Company”)
ANNOUNCEMENT REGARDING THE ACQUISITION OF GREAT WESTERFORD
1. Introduction
Ingenuity shareholders are advised that the Company has entered into an offer to purchase (“the Offer”)
with The Leaf Property Fund Trust (“the Seller”), in terms of which Ingenuity will acquire Sections 1 and 2
in the scheme known as Great Westerford, which represents 100 % of the rental enterprise, including its
improvements and leases, in respect of Sectional Plan number SS240/2011 situated at Rondebosch,
Cape Town (“the Property”) and known as Great Westerford (“the Acquisition”).
The Acquisition will become effective on transfer of the Property, which is expected to be on or about 1
March 2016 (“the Effective Date”).
2. Rationale for the Acquisition
The Property has been acquired in line with the Company’s strategy to invest in value-add opportunities
in the Western Cape. Great Westerford is considered to be one of Cape Town’s iconic properties and is
located in a prime position in the leafy southern suburb of Newlands situated at 240 Main Road. This
A-grade property was recently refurbished thus re-inforcing its position in a prime office node. The
building comprises 31 943 m2 of GLA and 1072 parking bays. It is well let and has a weighted average
lease expiry of close to 6 years.
3. Consideration for the Acquisition
The total consideration for the Acquisition is R650 000 000 excluding VAT (“the Purchase
Consideration”).
The Purchase Consideration will be settled by Ingenuity in cash on the Effective Date, with the option, at
Ingenuity’s election, to issue Ingenuity shares (“the Consideration Shares”) to settle the Purchase
Consideration. Ingenuity has undertaken to place the Consideration Shares on the Seller’s behalf such
that the Seller will receive the full Purchase Consideration in cash.
4. Conditions precedent
The Acquisition is subject to the fulfilment of the following conditions precedent:
4.1 Ingenuity board approval by 26 November 2015;
4.2 the trustees of the Seller approving in writing the sale of the Property by 27 November 2015;
4.3 mortgage finance approval on terms acceptable to Ingenuity in its sole discretion by
26 November 2015;
4.4 Ingenuity being satisfied in its sole discretion with the results of a comprehensive due diligence
of the Property by 15 December 2015;
4.5 Competition Commission approval, to the extent required;
4.6 Ingenuity shareholder approval. Ingenuity will provide sufficient irrevocable undertakings from
its shareholders to vote in favour of the Acquisition by 26 November 2015 to the Seller; and
4.7 such JSE regulatory requirements as may be necessary.
In addition to the aforementioned conditions precedent, the Seller has excercised a pre-emptive right to
acquire a 50% undivided share it did not already own in the Property which pre-emptive right remains
subject to the fulfilment of a number of conditions precedent.
5. Information relating to the Property
Property Location Sector Section areas Gross Single or Weighted Purchase Value of
lettable area multi- average Consideration the
(m2) tenanted net rental (R’m) Property
per m2 (R’m)1
(R/m2)
Section 1 240 Main Offices 42 293 m2 and 31 943 m2 Multi- 131/m2 650 650
and 2 of Road, 16 587 m2 1072 parking tenanted and 1 102
Sectional Newlands bays per bay
Plan No ss
240/2011
1. No independent valuation has been performed on the Property. The value attributed to the Property has been derived by the directors of the
Company using the capitalisation of rental method.
6. Value of net assets and profits attributable to the net assets of the Acquisition
The value of the net assets that are the subject of the Acquisition is R650 000 000 and the profits
attributable to the net assets that are the subject of the Acquisition are R53 484 995 based on a fully let
basis. The resultant effective initial yield is 8.22%. The profits are based on projections provided for the
period 1 November 2015 to 31 October 2016.
In terms of the Offer the Seller shall provide to Ingenuity a two year rental guarantee for any vacant
space as at the Effective Date.
7. Categorisation of the Acquisition
The Acquisition is a Category 1 transaction in terms of JSE Listings Requirements. A circular, containing
full details of the Acquisition and incorporating a notice of general meeting and form of proxy, will be
posted to shareholders in due course.
20 November 2015
Cape Town
Investment Bank and Sponsor
Nedbank Corporate and Investment Banking
Legal advisers
Webber Wentzel
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