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Rights offer declaration announcement
INVESTEC AUSTRALIA PROPERTY FUND
Incorporated and registered in Australia in terms of ASIC (ARSN 162 067 736)
Registered as a foreign collective investment scheme in terms of the Collective Investment Schemes Control Act No.
45 of 2003 and operated by Investec Property Limited (ACN 071 514 246; AFSL 290 909) (“Responsible Entity”)
Share code: IAP
ISIN: AU60INL00018
(“IAPF” or “the Fund”)
RIGHTS OFFER DECLARATION ANNOUNCEMENT
1. Introduction
Unitholders are advised that the Fund intends to undertake a partially underwritten rights offer to raise up to
ZAR 690,000,000, (AUD 60,000,000 at a ZAR:AUD exchange rate of R11.50) through the issue of 59,566,747
new units (“Rights Offer Units”). The Rights Offer Units will be issued in the ratio of 23.54653 new units for
every 100 units held on the rights offer record date, being Friday, 5 February 2016 (“Initial Record Date”), at an
issue price of R11.58 per Rights Offer Unit (“Rights Offer”).
The Rights Offer price of R11.58 per Unit represents a 7.4% discount to the 30-day volume-weighted average
price and a 12.6% discount to the closing price of units listed on the JSE as at the close of business on
Thursday, 14 January 2016, being the last practical date prior to finalisation of the Rights Offer pricing.
The Rights Offer Units will rank pari passu in every respect with the existing issued units in terms of both voting
and distribution rights.
2. Use of Rights Offer proceeds
IAPF has successfully completed approximately AUD 268,000,000 of portfolio enhancing property acquisitions
since the last rights offer in October 2014, including the acquisition of the property at 266 King Street, Newcastle
NSW for AUD 56.7m announced in December 2015. These acquisitions were primarily funded with debt and
accordingly, the proceeds of the Rights Offer will be used reduce the Fund’s gearing from 45% to 31% post
completion of the rights offer (if fully subscribed). This will also provide the Fund with further acquisition capacity
allowing it to:
• take advantage of attractive opportunities in its pipeline which it continues to source through its network;
• achieve the Fund’s target gearing level of between 35% and 40%; and
• further lock in the current favourable yield spread of approximately 300 - 400 basis points due to the
favourable Australian interest rate environment.
The Fund remains on target to achieve its full year distribution growth of between 10% and 12% in AUD.
3. Terms of the Rights Offer
3.1. Rights Offer price
The Rights Offer Price of R11.58 per Rights Offer Unit includes an entitlement to receive the distribution
declared for the six months ended 31 March 2016, which will be distributed to Unitholders when the Fund
makes its final distribution during June 2016.
3.2. Opening and closing dates of the Rights Offer
The Rights Offer will open at 09:00 on Monday, 8 February 2016 and will close at 12:00 on Friday, 19
February 2016. Letters of allocation will be listed and commence trading at the commencement of
business on Monday, 1 February 2016.
3.3. Committed Participants
The Fund has concluded an agreement (“Agreement”) with Investec Property Fund Limited and Investec
Bank Limited (“Committed Participants”), being 12.0% and 16.5% unitholders in IAPF respectively, in
terms of which the Committed Participants have elected to irrevocably subscribe for their pro rata
entitlement in terms of the Rights Offer, representing 28.5% of the aggregate Rights Offer proceeds.
The Committed Participants are entitled to receive a commitment fee of 0.5% of the aggregate value of
the subscription amount payable in order to take up their pro rata entitlement in terms of the Rights Offer
(“Committed Amount”).
3.4. Underwriting
In terms of the Agreement, Investec Property Fund Limited (“Underwriter”) has agreed to underwrite a
portion of the Rights Offer up to a value of ZAR 232,504,529 (“Underwritten Amount”), which is in
excess of its portion of the Committed Amount.
The Underwriter is entitled to an underwriting fee of 1.0% of the Underwritten Amount is only payable
upon compliance by the Underwriter with its obligations in terms of the Agreement.
Excess Rights Offer Units available for allocation will, in the first instance, be allocated to the Underwriter
and thereafter to those Unitholders who have made application for excess Rights Offer Units.
The terms of the Agreement were agreed in December 2015 during a period of significant volatility in
South African markets. This enabled the Responsible Entity to maintain its yield enhancing acquisitive
strategy with the comfort that the Rights Offer would be partially underwritten and the Fund’s gearing
would return to the target range post the Rights Offer.
The underwritten portion equates to a further 33.7% of the Rights Offer proceeds, such that the Rights
Offer is 62.2% covered as a result of the above arrangements.
3.5. Excess applications
Unitholders recorded in the register on the Initial Record Date will be permitted to apply for any excess
Rights Offer Units not taken up by other unitholders in terms of their rights in the Rights Offer.
Excess Rights Offer Units available for allocation will, in the first instance be allocated to the Underwriter,
subject to its maximum commitment as set out in paragraph 3.4 above, and thereafter to those persons
who have made application for excess Rights Offer Units in an equitable manner as determined by the
Responsible Entity in accordance with the provisions of paragraph 5.33 of the Listings Requirements of
the JSE.
3.6. Minimum subscription
The Rights Offer is partially underwritten up to a value of ZAR 232,504,529 (AUD 20,217,785 at a
ZAR:AUD exchange rate of R11.50) and is not conditional on a minimum subscription.
3.7. Foreign unitholders
The Rights Offer may be affected by the laws of the relevant jurisdictions of foreign unitholders. The
Rights Offer circular will not be regarded as an offer in any jurisdiction in which it is illegal to make such
an offer. It is the responsibility of any foreign unitholder to satisfy themselves as to the full observation of
the laws and regulatory requirements of the relevant jurisdiction in connection with the Rights Offer,
including the obtaining of any governmental, exchange control or other consent or the making of any
filings which may be required, the compliance with other necessary formalities, the payment of any issue,
transfer or other taxes or other requisite payments due in such jurisdiction.
4. Finalisation announcement
It is anticipated that a finalisation announcement in respect of the Rights Offer will be released on SENS on
Tuesday, 26 January 2016.
5. Salient dates and times
The proposed salient dates and times in respect of the Rights Offer are set out below:
2016
Declaration date announcement in respect of the Rights Offer released on SENS Friday, 22 January
Finalisation date announcement in respect of the Rights Offer released on SENS Tuesday, 26 January
Last date to trade in units for settlement by the Initial Record Date and in order to Friday, 29 January
participate in the Rights Offer
Listing and trading of letters of allocation on the JSE under JSE code: IAPN and ISIN: Monday, 1 February
ZAE000212908
Units commence trading on the JSE ex-Rights Offer entitlement Monday, 1 February
Rights Offer circular including a Form of Instruction distributed to certificated unitholders Tuesday, 2 February
Record Date for determination of unitholders entitled to participate in the Rights Offer Friday, 5 February
(Initial Record Date)
Dematerialised unitholders will have their accounts at their CSDP or broker Monday, 8 February
automatically credited with their entitlement
Certificated unitholders on the register will have their entitlement credited to their Monday, 8 February
accounts held with the Transfer Secretaries
Rights Offer opens at 09:00 Monday, 8 February
Rights Offer circular distributed to those dematerialised unitholders who have elected to Tuesday, 9 February
receive documents in hard copy
Last day to trade in the letters of allocation on the JSE in order to settle by close of the Friday, 12 February
Rights Offer
Rights Offer Units listed and trading therein commences at 09:00 on the JSE Monday, 15 February
Payment to be made and form of instruction to be lodged with the Transfer Friday, 19 February
Secretaries by certificated unitholders by 12:00
Rights Offer closes at 12:00 Friday, 19 February
Record date for letters of allocation Friday, 19 February
Rights Offer Units issued on Monday, 22 February
Dematerialised unitholders’ accounts updated and debited by CSDP or broker (in Monday, 22 February
respect of payment for Rights Offer Units)
Certificates distributed to certificated unitholders (in respect of the Rights Offer Units) Monday, 22 February
Results of Rights Offer announced on SENS Monday, 22 February
Refunds (if any) to certificated unitholders in respect of unsuccessful excess Wednesday, 24 February
applications made
Dematerialised unitholders accounts updated and debited by their CSDP or broker (in Wednesday, 24 February
respect of successful excess applications)
Certificates distributed to certificated unitholders (in respect of successful excess Wednesday, 24 February
applications)
Notes:
1. All references to dates and times are to local dates and times in South Africa.
2. Dematerialised unitholders are required to inform their CSDP or broker of their instructions in terms of the Rights Offer in the manner and
time stipulated in the agreement governing the relationship between the unitholder and their CSDP or broker.
3. Unit certificates may not be dematerialised or rematerialised between Monday, 1 February 2016 and Friday, 5 February 2016, both days
inclusive.
4. Dematerialised unitholders will have their accounts at their CSDP or broker automatically credited with their rights and certificated
unitholders will have their rights credited to a nominee account with Computershare Investor Services Proprietary Limited.
5. CSDPs effect payment in respect of dematerialised unitholders on a delivery-versus-payment method.
6. Posting of the Rights Offer circular
Distribution of the Rights Offer circular to certificated unitholders is expected to be on Tuesday, 2 February
2016.
It is anticipated that the Rights Offer circular will be distributed to dematerialised unitholders on Tuesday, 9
February 2016.
Sydney
22 January 2016
Corporate Advisor and Sponsor
Investec Bank Limited
Legal Advisor (Australia)
Herbert Smith Freehills
Legal Advisor (South Africa)
Fluxmans Inc.
Date: 22/01/2016 11:21:00 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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