Wrap Text
Intention to float announcement
LIBERTY TWO DEGREES
(A PORTFOLIO IN THE LIBERTY TWO DEGREES SCHEME, A COLLECTIVE INVESTMENT SCHEME
IN PROPERTY ESTABLISHED IN TERMS OF THE COLLECTIVE INVESTMENT SCHEMES
CONTROL ACT, NO 45 OF 2002, AS AMENDED, AND MANAGED BY STANLIB REIT FUND
MANAGERS PROPRIETARY LIMITED (RF), THE APPROVED / REGISTERED MANAGER OF THE
SCHEME (REGISTRATION NUMBER 374))
JSE code: L2D
ISIN: ZAE000230553
INTENTION TO FLOAT ANNOUNCEMENT
15 NOVEMBER 2016
NOT FOR PUBLICATION, DISTRIBUTION OR RELEASE, IN WHOLE OR IN PART, DIRECTLY OR
INDIRECTLY, IN OR INTO THE UNITED STATES OF AMERICA, CANADA, JAPAN, AUSTRALIA OR
ANY OTHER JURISDICTION OUTSIDE SOUTH AFRICA.
This announcement is not a prospectus and not an offer of securities for sale in any jurisdiction, including
in the United States, Canada, Japan or Australia.
Neither this announcement nor anything contained herein shall form the basis of, or be relied upon in
connection with, any offer or commitment whatsoever in any jurisdiction. Any application or offer to
acquire participatory units ("Units") in Liberty Two Degrees will be made, and any investor should make
his investment decision, solely on the basis of the information that is contained in the Pre-listing
Statement (the “Pre-listing Statement”) to be published by Liberty Two Degrees in due course in
connection with the listing of Units on the main board of the securities exchange operated by the JSE
Limited (the “JSE”), subject to approval by the JSE. Copies of the Pre-listing Statement will, following
publication, be available from Liberty Two Degrees.
LIBERTY TWO DEGREES ANNOUNCES ITS INTENTION TO FLOAT ON THE JSE MAIN BOARD
Johannesburg, 15 November 2016
Liberty Two Degrees has today announced its intention to list its units on the “Diversified REITs” sector of
the main board of the securities exchange operated by the JSE, subject to market conditions and the
approval by the JSE. It is anticipated that the listing will occur in early December 2016.
LIBERTY TWO DEGREES: AN ICONIC SOUTH AFRICAN PROPERTY PORTFOLIO
On listing, Liberty Two Degrees will own undivided shares in the Liberty Property Portfolio valued at
approximately R6 billion (approximately 22% of the Liberty Property Portfolio’s investment property). The
Liberty Property Portfolio is one of South Africa’s iconic property portfolios with interests in assets such as
the Sandton City Complex, the Eastgate Complex and Melrose Arch. The total Liberty Property Portfolio
2
has a value of approximately R27.4 billion and a GLA of approximately 615,826m .
Liberty Two Degrees will co-own predominantly retail real estate assets in South Africa. In Johannesburg,
interests will include the Sandton City Complex, the Eastgate Complex and Nelson Mandela Square.
Other retail assets are two regional shopping centres, being Liberty Midlands Mall in KwaZulu-Natal and
Liberty Promenade in Mitchells Plain in the Western Cape, the mixed-use precinct of Melrose Arch in
Johannesburg and the newly developed Botshabelo Mall in the Free State.
The Sandton City Complex is located in the economic heartland of the country and showcases some of
the most prestigious international and domestic retailers. The attraction of its long-established presence
and overall quality make it irreplaceable and confers brand-value and recognition on Liberty Two
Degrees. Similarly, the Eastgate Complex, with its strong history and recent upgrade, is located in a large
catchment area with good access. The recently refurbished Nelson Mandela Square is a destination
centre with a compelling entertainment offering complementing the neighbouring Sandton City Complex.
Melrose Arch’s office and retail component supports its status as one of the leading mixed use precincts
in Johannesburg’s high end Northern Suburbs.
In addition to the offices included in the main retail complexes, Liberty Two Degrees will co-own select
office properties located in key business nodes with blue-chip anchor tenants. These properties include
the Standard Bank Centre in Johannesburg, the Liberty Centre in Century City Office Park in Cape Town
and Liberty Centre in Umhlanga Ridge, Durban.
The Liberty Property Portfolio has consistently outperformed its benchmark of CPI + 5% over a rolling 5
year period. Liberty Two Degrees is forecast to have a 12 month forward yield of 6.5% on an ungeared
basis. The defensive nature of the portfolio is expected to drive performance in a challenging economic
environment. It is important to note, however, that the past performance of the Liberty Property Portfolio is
not indicative of the future performance of Liberty Two Degrees.
Amelia Beattie, Chief Executive Officer of Liberty Two Degrees said:
“Liberty Two Degrees is the result of a truly collaborative effort between Liberty and STANLIB. It unlocks
value for existing customers and provides an alternative way to invest in quality property assets through
the listed equity market environment.”
“We have already identified investment opportunities and new developments in quality assets, focusing
on South Africa in the first instance. The portfolio will be managed by the same team that was previously
within STANLIB and who have managed the Liberty Property Portfolio for many years. This team has a
proven track record and the necessary expertise to successfully deliver sustainable long-term returns to
the unitholders of Liberty Two Degrees.”
GROWTH PROSPECTS
The scale, long-established presence, quality and location of the retail component of Liberty Two
Degrees, together with its experienced management team, position it as one of the premier real estate
investment opportunities in South Africa. The listing of Liberty Two Degrees provides invited investors
with a unique opportunity to invest in one of South Africa’s iconic retail property portfolios.
A significant amount of capital expenditure has been historically incurred to maintain the high quality of
the portfolio. Over the past 5 years, in excess of R2.5 billion has been spent on developments and
redevelopments, including Botshabelo Mall, Sandton City Complex, Eastgate Complex, John Ross Eco-
Junction – Melomed Hospital and Nelson Mandela Square. The expansion of Liberty Midlands Mall
commenced earlier this month.
Liberty Two Degrees will be ungeared on listing and will be able to take on debt (in line with gearing
levels in the sector) to fund future quality acquisitions, as appropriate.
In the short term, Liberty Two Degrees will focus its growth strategy in South Africa. Growth is expected
to come from a select number of identified high quality acquisition targets, as well as from Liberty Two
Degrees’ current development pipeline.
Liberty and Liberty Two Degrees are in discussions to acquire an iconic property that is aligned to the
Liberty Property Portfolio and the Liberty Two Degrees investment strategy. This would be the primary,
but not the sole, use of the proceeds of the Private Placement and it is expected that the consideration
payable by Liberty Two Degrees, should a transaction be concluded, would be a mixture of units and
cash.
THE PRIVATE PLACEMENT AND LISTING
The offer will comprise a private placement in order for:
- Liberty Two Degrees to raise up to approximately R2.8 billion by way of:
o subscription by invited investors for up to approximately 200 000 000 private placement
units at a subscription price of R10.00;
o subscription by Liberty (using its new policyholders’ funds) for 82 127 545 private
placement units at a 5% discount to the subscription price payable by invited investors,
being R9.50 per private placement unit. Liberty has undertaken to subscribe for these
units; and
- Liberty, to the extent that there is sufficient demand from invited investors, to sell (out of its
shareholders’ funds) up to approximately 100 000 000 Liberty Two Degrees units,
(together, the “Private Placement”).
The Standard Bank of South Africa Limited (“Standard Bank”) and Java Capital (Pty) Limited (“Java
Capital”) have been appointed as Joint Bookrunners and Joint Transaction Sponsors in relation to the
Private Placement.
A pre-listing statement including full details of the Private Placement will be made available in due course.
Johannesburg
15 November 2016
Enquiries:
Singular Systems (media contact)
Jacques De Bie
+27 (0)82 691 5384
Standard Bank
Richard Stout
+27 (0)11 344 5725
Dan Smith
+27 (0)11 721 6038
Java Capital
Andrew Brooking
+27 (0)11 722 3052
Carl Esterhuysen
+27 (0)11 722 3054
DISCLAIMER:
The contents of this announcement have been prepared by and are the sole responsibility of Liberty Two
Degrees.
The information contained in this announcement is for background purposes only and does not purport to
be full or complete. No reliance may be placed by any person for any purpose on the information
contained in this announcement or its accuracy, fairness or completeness.
This announcement is not for publication or distribution, directly or indirectly, in or into the United States
(including its territories and possessions, any State of the United States and the District of Columbia),
Europe, Australia, Canada, Japan or outside South Africa. The distribution of this announcement may be
restricted by law in certain jurisdictions outside South Africa and persons into whose possession any
document or other information referred to herein comes should inform themselves about and observe any
such restriction. Any failure to comply with these restrictions may constitute a violation of the securities
laws of any such jurisdiction. Copies of this announcement are not being made and may not be
distributed or sent into the United States, Canada, Australia, Japan or outside South Africa.
This announcement does not constitute or form a part of any offer or solicitation to purchase or subscribe
for securities to any person in the United States, Europe, Australia, Canada, Japan or in any jurisdiction
outside South Africa. The securities referred to herein (the “Units”) may not and will not be offered or sold
outside South Africa.
The Private Placement will only be made availabe to invited investors who subscribe, as principal, for
Units at a minimum aggregate subscription price of R1 000 000 ("Invited Investors"). Any person who is
not an Invited Investor should not act on this announcement or any of its contents.
The information contained in this announcement constitutes factual information as contemplated in
section 1(3)(a) of the South African Financial Advisory and Intermediary Services Act, 37 of 2002, as
amended ("FAIS Act") and should not be construed as an express or implied recommendation, guide or
proposal that any particular transaction in respect of the Units or in relation to the business or future
investments of Liberty Two Degrees is appropriate to the particular investment objectives, financial
situations or needs of a prospective investor, and nothing in this announcement should be construed as
constituting the canvassing for, or marketing or advertising of, financial services in South Africa.
This announcement may include statements that are, or may be deemed to be, “forward-looking
statements”. These forward-looking statements may be identified by the use of forward-looking
terminology, including the terms “believes”, “estimates”, “plans”, “projects”, “anticipates”, “expects”,
“intends”, “may”, “will” or “should” or, in each case, their negative or other variations or comparable
terminology, or by discussions of strategy, plans, objectives, goals, future events or intentions. Forward-
looking statements may and often do differ materially from actual results. Any forward-looking statements
reflect Liberty Two Degrees' current view with respect to future events and are subject to risks relating to
future events and other risks, uncertainties and assumptions relating to Liberty Two Degrees' business,
results of operations, financial position, liquidity, prospects, growth and strategies. Forward-looking
statements speak only as of the date they are made. In accordance with section 6(1) of Financial
Services Board Notice 92 of 2014, prospective investors are reminded that:
- collective investment schemes are generally medium to long-term investments;
- the value of Units or the investment may go down as well as up;
- past performance is not necessarily a guide to future performance;
- collective investment schemes are traded at ruling prices and can engage in borrowing;
- a schedule of fees and charges is available on request from STANLIB REIT Fund Managers. The
listing and related fees as well as STANLIB REIT Fund Managers' fees are set out the Pre-Listing
Statement; and
- STANLIB REIT Fund Managers does not provide any guarantee either with respect to the capital or
the return on Liberty Two Degrees.
Each of Liberty, Liberty Two Degrees, Standard Bank and Java Capital and their respective affiliates
expressly disclaims any obligation or undertaking to update, review or revise any forward looking
statement contained in this announcement whether as a result of new information, future developments or
otherwise.
Any purchase or subscription of Units in the Private Placement should be made solely on the basis of the
information contained in the Pre-listing Statement to be issued by Liberty Two Degrees in connection with
the Private Placement. The information in this announcement is subject to change. Before subscribing for
or purchasing any Units, persons viewing this announcement should ensure that they fully understand
and accept the risks which will be set out in the Pre-listing Statement when published. No reliance may be
placed for any purpose on the information contained in this announcement or its accuracy or
completeness.
The date of the listing may be influenced by things such as market conditions. There is no guarantee that
listing will occur and you should not base your financial decisions on the intentions of Liberty Two
Degrees in relation to listing at this stage. Acquiring investments to which this announcement relates may
expose an investor to a significant risk of losing all of the amount invested. Persons considering making
such investments should consult an authorised person specialising in advising on such investments. This
announcement does not constitute a recommendation concerning the Private Placement. The value of
units can decrease as well as increase. Potential investors should consult a professional advisor as to the
suitability of the Private Placement for the person concerned.
Neither Standard Bank, Java Capital or any of their respective directors, officers, employees, advisers or
agents accepts any responsibility or liability whatsoever for/or makes any representation or warranty,
express or implied, as to the truth, accuracy or completeness of the information in this announcement (or
whether any information has been omitted from the announcement) or any other information relating to
Liberty Two Degrees, its subsidiaries or associated companies, whether written, oral or in a visual or
electronic form, and howsoever transmitted or made available or for any loss howsoever arising from any
use of the announcement or its contents or otherwise arising in connection therewith.
Standard Bank and Java Capital are acting exclusively for Liberty Two Degrees and Liberty and no-one
else in connection with the Private Placement. They will not regard any other person as their respective
clients in relation to the Private Placement and will not be responsible to anyone other than Liberty Two
Degrees and Liberty for providing the protections afforded to their respective clients, nor for providing
advice in relation to the Private Placement, the contents of this announcement or any transaction,
arrangement or other matter referred to herein.
In connection with the Private Placement, Standard Bank, Java Capital and any of their respective
affiliates, may take up a portion of the Units as a principal position and in that capacity may retain,
purchase, sell, offer to sell or otherwise deal for their own accounts in such Units and other securities of
Liberty Two Degrees or related investments in connection with the Private Placement or otherwise.
Accordingly, references in the Pre-listing Statement, once published, to the Units being issued, offered,
subscribed, acquired, placed or otherwise dealt in should be read as including any issue or offer to, or
subscription, acquisition, placing or dealing by Standard Bank, Java Capital and any of their respective
affiliates acting in such capacity. In addition, Standard Bank and Java Capital may enter into financing
arrangements and swaps in connection with which they or their affiliates may from time to time acquire,
hold or dispose of Units. Neither Standard Bank, Java Capital nor any of their respective affiliates intend
to disclose the extent of any such investment or transactions otherwise than in accordance with any legal
or regulatory obligations to do so.
Unless otherwise indicated, market, industry, market share and competitive position data are estimates
(and accordingly, approximate) and should be treated with caution. Such information has not been
audited or independently verified, nor has Liberty Two Degrees ascertained the underlying economic
assumptions relied upon therein.
Date: 15/11/2016 07:30:00 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
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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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