Wrap Text
Joint firm intention by Rebosis to acquire the Ascension A shares it does not already own by scheme of arrangement
Ascension Properties Limited Rebosis Property Fund Limited
(Registration number 2006/026141/06) (Registration number 2010/003468/06)
JSE share code: AIA ISIN: ZAE000204566 JSE share code: REB ISIN: ZAE000201687
(Approved as a REIT by the JSE) (Approved as a REIT by the JSE)
(“Ascension” or “the company”) (“Rebosis”)
JOINT ANNOUNCEMENT OF A FIRM INTENTION BY REBOSIS TO MAKE AN OFFER TO ACQUIRE 100% OF THE ISSUED A ORDINARY SHARES OF ASCENSION
THAT IT DOES NOT ALREADY OWN BY SCHEME OF ARRANGEMENT
1. Introduction and rationale
Ascension and Rebosis have concluded an agreement in terms of which Rebosis has given notice of its firm intention to
offer to acquire all of the Ascension A ordinary shares that Rebosis does not already own in exchange for Rebosis A
ordinary shares, by scheme of arrangement (the “scheme”).
Following the implementation of a scheme of arrangement between Ascension and Ascension B shareholders on
17 August 2015, Rebosis acquired (and subsequently delisted) all of the Ascension B shares in issue and Ascension
became a listed subsidiary of Rebosis.
The proposed transaction will result in an enlarged market capitalisation for Rebosis, with economies of scale and
enhanced liquidity. The terms of the Rebosis A ordinary shares effectively mirror the terms of the Ascension A ordinary
shares. In addition, the cash-cover ratio applicable to the Rebosis A ordinary shares will be significantly higher than the
cash-cover ratio applicable to Ascension A shares.
Rebosis and Ascension are of the view that the proposed transaction and the implementation of the scheme best advances
the interests of their investors.
2. Scheme consideration
In terms of the scheme, if implemented, the Ascension A shares held by Ascension A shareholders will be exchanged for
Rebosis A ordinary shares Rebosis (“Rebosis A ordinary consideration shares”) on a swap ratio of 19.34236 Rebosis A
ordinary consideration shares for every 100 Ascension A shares held.
In accordance with the terms of the Rebosis A ordinary consideration shares, upon the declaration of a distribution by
Rebosis to its ordinary shareholders, no such distribution shall be paid to Rebosis ordinary shareholders unless the Rebosis
A ordinary consideration shares have been paid their distribution, which shall be in the same amounts as Ascension A
shares’ entitlement to fixed income distributions. In addition, the rights of Rebosis A ordinary consideration shares in
relation to voting and liquidation proceeds will effectively mirror those attaching to Ascension A shares save that –
- for every 5.17 Ascension A shares, an Ascension A shareholder will instead hold 1 Rebosis A ordinary
consideration share with an entitlement to preferred income distributions, as referred to above;
- the voting rights attaching to the Rebosis A ordinary consideration shares will be not more than 25% of the total
voting rights applicable to Rebosis shareholders collectively (that is the voting rights of the holders of Rebosis A
ordinary consideration shares and Rebosis ordinary shares); and
- no further Rebosis A ordinary consideration shares will be created or issued.
3. Conditions
The scheme will be subject to the following suspensive conditions:
- approval by Rebosis shareholders and filing by the Companies and Intellectual Property Commission of the
requisite special resolutions, including resolutions to amend the memorandum of incorporation and authorised
shares of Rebosis, required to authorise the implementation of the scheme and the allotment and issue of the
Rebosis A ordinary consideration shares;
- to the extent required under section 115(3) of the Companies Act, approval by the court of the implementation of
the scheme resolution court is obtained and, if applicable, Ascension not having treated the special resolution
required in terms of section 115(2) of the Companies Act to approve the scheme (the “scheme resolution”) as a
nullity, as contemplated in section 115(5)(b) of the Companies Act;
- Ascension shareholders not having given, in terms of section 164(3) of the Companies Act, valid notice of objection
to the scheme resolution taken at the scheme meeting and those objecting Ascension shareholders not having voted
against the scheme resolution at the scheme meeting;
- all applicable regulatory and statutory approvals are obtained; and
- such approvals, consents or waivers, if any, as may be required in terms of any debt funding agreement entered into
by Ascension, in order to give effect to the scheme.
4. Undertaking to Rebosis A ordinary shareholders
In terms of the scheme Rebosis will provide an undertaking in favour of the holders of Rebosis A shares from time to time,
that the directors of Rebosis shall not of their own accord initiate any process or steps designed to result in a conversion of
the Rebosis A shares to Rebosis ordinary shares as contemplated in clause 18 of the Memorandum of Incorporation of
Rebosis (which sets out the terms on which the Rebosis A ordinary shares may be converted into Rebosis ordinary shares),
it being understood that such undertaking will not be construed as affecting the rights of Rebosis shareholders to effect
such a conversion in terms of clause 18 of the Memorandum of Incorporation of Rebosis or as affecting any legal
obligations which the directors of Rebosis may have in terms of clause 18 of the Memorandum of Incorporation of
Rebosis.
5. Distributions
The Rebosis A ordinary consideration shares are to be issued “cum” entitlement to all distributions for the period from
1 September 2016.
Rebosis will declare and pay an interim distribution to Rebosis ordinary shareholders for the six months ending
31 August 2016 in the ordinary course of business.
In addition, Ascension will declare and pay an interim distribution to Ascension A shareholders and the Ascension B
shareholder (Rebosis) for the six months ending 31 August 2016 in the ordinary course of business.
Rebosis’ interim distributions in respect of the Rebosis A ordinary shares and the Rebosis ordinary shares for the financial
year ending 31 August 2017 will be for the period 1 September 2016 to 28 February 2017. The full interim distributions
will be payable to all Rebosis shareholders who hold Rebosis A ordinary shares and Rebosis ordinary shares as at the
record date for participation in such distribution.
6. Ascension board undertakings
Rebosis has received undertakings from Ascension that for the period up to the implementation of the scheme:
- Ascension will continue to conduct its business in the ordinary and regular course;
- save for the proposed acquisition by Ascension of the immovable property situate at 66 Jorissen Street,
Johannesburg, the salient features of which have been disclosed to Rebosis and save as publically announced on
SENS up to the date of this announcement (which, for the avoidance of doubt, includes the disposal of the
properties known as Bergstan House, Matrix House and Nedbank Centre, announced on SENS on 11 August 2016)
or as may be agreed to by Rebosis in writing, Ascension will not make any further acquisitions or effect any
disposals;
- not declare or make any distributions other than as referred to in this announcement without the prior written
consent of Rebosis;
- not solicit, initiate or encourage any expression of interest, enquiry, proposal or offer regarding any merger,
amalgamation, business combination, takeover bid, sale or other disposition of all or substantially all of the equity in
and/or business and/or assets of Ascension, or afford options to acquire equity, the business and/or assets of
Ascension or enter into any negotiation or consummate any transaction for any type of similar transaction or series
of transactions, which would or could constitute a change of control (as contemplated in section 123(5) of the
Companies Act read with Regulation 86 of the Takeover Regulations) in relation to Ascension or which could
reasonably be considered to be likely to preclude or frustrate the proposed transaction with Rebosis or its
implementation ("alternative proposal") or to approve or recommend an alternative proposal or enter into any
agreement related to an alternative proposal.
7. Pro forma earnings and net asset value effects pertaining to the scheme
As the Ascension A shareholders will, in terms of the scheme, exchange their Ascension A shares for Rebosis A ordinary
consideration shares that will effectively mirror the economics of the Ascension A shares (as referred to in paragraph 2)
there will be no financial effect on Ascension A shareholders who elect to receive the Rebosis A consideration shares. In
addition, the cash-cover ratio applicable to the Rebosis A ordinary consideration shares will be significantly higher than the
cash-cover ratio applicable to Ascension A shares.
8. Ascension shareholder support
No Ascension A shareholder has given any undertaking to vote in favour of the A share scheme, however Coronation
Asset Managers Proprietary Limited, acting on behalf of its clients (“Coronation”) which controls c.60% of the Ascension
A shares in issue has provided Rebosis with a written ‘in principle’ letter of support in favour of the scheme.
9. Independent expert
In accordance with the requirements of chapter 5 of the Companies Regulations, the independent board comprises Haroon
Takolia, Mervyn Burton, Nkosi-Yawo Gugushe and Mbulelo Renene, being directors Ascension has indicated are
independent for the purposes of considering the scheme in accordance with the requirements of the Companies Regulations
(the “independent board”).
The independent board will appoint an independent expert acceptable to the Takeover Regulation Panel (“TRP”) (as
required in terms of section 114(2) of the Companies Act, read together with regulations 91(1) and 110 of the Companies
Regulations) (the “independent expert”), to advise and report to the independent board on the offer by way of a fair and
reasonable opinion. The independent expert’s full report as well as the independent board’s opinion of the scheme and the
scheme consideration will be included in the circular to be issued to Ascension A shareholders in respect of the scheme.
10. Confirmation to the TRP
In accordance with the Companies Act’s Regulations, Rebosis has confirmed with the TRP that, upon the filing of the
requisite special resolutions required to authorise the implementation of the scheme and the allotment and issue of the
Rebosis A ordinary consideration shares, it will have a sufficient number of authorised and unissued Rebosis A ordinary
shares in order to satisfy the offer.
11. Shareholding of Rebosis in Ascension
Rebosis currently holds:
- 28 001 628 Ascension A shares, comprising approximately 9.1% of the Ascension A shares in issue; and
- 376 359 014 Ascension B shares, comprising 100% of the Ascension B shares in issue.
12. No concert party arrangements
Rebosis is not acting in concert with any person in relation to the scheme.
13. Documentation and timing in regard to the scheme
Full details of the scheme will be set out in a joint circular which will be distributed by Rebosis and Ascension to each of
the Ascension A shareholders within 20 business days after the date of this firm intention announcement and which will
include the opinion of the independent expert referred to in paragraph 9 above, notice of the general meeting of Ascension
A shareholders to approve the scheme, and the salient dates and times applicable to the scheme.
14. Categorisation of the scheme for Rebosis
The scheme is classified as a Category 2 transaction for Rebosis in terms of the JSE Listings Requirements. As such, it is
not in terms of the JSE Listings Requirements, subject to approval by Rebosis shareholders.
A general meeting of Rebosis shareholders will be called to approve the requisite special resolutions, including a resolution
to amend the memorandum of incorporation of Rebosis, required to authorise the implementation of the scheme and the
allotment and issue of the Rebosis A ordinary consideration shares.
15. Property specific information
The property specific information required in terms of the JSE Listings Requirements in relation to each of the properties
comprising Ascension’s property portfolio, is set out below.
Property Name Physical Address Property Building Weighted Valuation as at
description rentable area Average Rental 29 February
and use (GLA) Per m2 2016
(R) (R ’000)
1. Bathopele Cnr Loveday and Market Streets, Office 11 500 101.9 153 000
Building Johannesburg
2. Spectrum Cnr Voortrekker and Blanckenberg Office 7 550 93.3 100 000
Streets, Bellville
Property Name Physical Address Property Building Weighted Valuation as at
description rentable area Average Rental 29 February
and use (GLA) Per m2 2016
(R) (R ’000)
3. Schreiner 94 Pritchard Street, Johannesburg Office 18 815 80.0 180 000
Chambers
4. Mishumo House De Korte and De Beer Streets, Office 6 154 90.0 77 000
Braamfontein
5. Sigma 7 Blanckenberg Road, Bellville, Cape Office 3 751 137.1 56 000
Town
6. 45 Castle Street 45 Castle Street, Cape Town Office 9 537 120.2 141 000
7. Bergstan House* Cnr Castle and Loop Streets, Cape Office 2 838 96.2 36 000
Town
8. Matrix House* Cnr Strand and Bree Streets, Cape Town Office 9 001 93.1 71 000
9. Nedbank Centre* Cnr Strand and Loop Streets, Cape Office 5 905 76.9 53 500
Town
10. NBC 76 Juta Street, Braamfontein Office 10 000 64.9 152 000
11. PROROM Cnr Brown and Paul Kruger Streets, Office 6 431 108.7 80 000
Nelspruit
Mpumalanga
12. VWL Corner Vermeulen & Paul Kruger Office/Retail 17 989 83.7 180 000
Streets, Nelspruit
13. 14 Long Street 14 Long Street, Cape Town Office 9 975 90.9 120 000
14. 373 Pretorius 373 Pretorius Street, Pretoria, Gauteng Office 13 340 125.9 236 000
Street
15. Meyersdal 65 Phillip Engelbrecht Street, Meyersdal Office 4 957 85.0 46 000
16. Infinity Office 4 Robin Close Meyersdal Nature Estate, Office 12 681 138.9 250 000
Park, Meyersdal Meyersdal
17. 238 Roan Corporate Landing, 238 Roan Crescent, Industrial 9 035 80.3 91 000
Crescent, Midrand Ranjespark
18. Grand Central Cnr Darling and Plein Streets, Cape Office and 33 577 127.5 588 000
Town retail
19. Medscheme 37 Conrad Drive, Florida Noord, Office 6 792 93.0 105 000
Roodepoort
20. Kingfisher King Fisher Crescent, Meyersdal Office 1 405 121.0 25 700
Crescent,
Meyersdal
21. 174 Visagie Street 174 Visagie Street, Pretoria Office 13 537 119.7 222 000
22. Island Centre 24 Cumberland Road, Paarden Eiland, Industrial 24 195 38.6 88 000
Cape Town
23. Riverpark 1 and 2 Madiba Street, Nelspruit Motor retail 8 519 134.5 133 000
and Riverview 1 park and
and 2 Office
24. Atterbury House 2 Waterkant Street, Cape Town Office 26 245 111.1 348 000
25. Surrey House Cnr Rissik and Fox Streets, Office 11 840 118.4 217 000
Johannesburg
26. Game Building Cnr Joubert and Pritchard Streets, Office 21 438 98.3 250 000
Johannesburg
27. Swiss House 86 Main Street Marshalltown Office 8 008 93.7 113 000
* Disposed of post 29 February 2016
Independent valuations were carried out on each of the properties as at 29 February 2016 by LDM Valuation Solutions
(Pty) Ltd, a registered professional valuer in terms of the Property Valuers Profession Act, No. 47 of 2000.
Rebosis currently owns 59.01% of the total number of issued shares in Ascension. The value of the net assets of Ascension
as at 29 February 2016 is R2 624 million. The value of the net assets being acquired by Rebosis is R1 076 million and the
profits attributable to net assets being acquired is R146 million, which is 40.99% of the estimated profits of Ascension for
the year ended 31 August 2016.
16. Responsibility statements
The Ascension independent board accepts responsibility for the information contained in this announcement insofar as it
relates to Ascension. To the best of its knowledge and belief, the information contained in this announcement is true and
this announcement does not omit anything likely to affect the import of the information.
The Rebosis board accepts responsibility for the information contained in this announcement insofar as it relates to
Rebosis. To the best of its knowledge and belief, the information contained in this announcement is true and the
announcement does not omit anything likely to affect the import of the information.
27 October 2016
Corporate advisor and sponsor to Rebosis and Ascension
Legal Advisor
Legal advisor to Ascension and Rebosis
Cliffe Dekker Hofmeyr Inc
Date: 27/10/2016 02:54:00 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.