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Disposal of properties
Freedom Property Fund Limited
(Incorporated in the Republic of South Africa)
(Registration No. 2012/129186/06)
Share code: FDP
ISIN: ZAE000185260
(“Freedom” or the “Company” or the “Group”)
DISPOSAL OF ERF 1210 AND A PORTION OF ERF 1212 OF STEELPOORT EXTENSION 10 IN THE
KT REGISTRATION DIVISION OF THE PROVINCE OF LIMPOPO
1. INTRODUCTION
Shareholders are advised that a wholly owned subsidiary of Freedom, Kadoma
Investments Proprietary Limited (the “Seller”) has entered into two sale
agreements (the “Sale Agreements”) with Boulder Processing Proprietary Limited
(the “Purchaser”) in terms of which the Purchaser will acquire, pursuant to
the Erf 1210 sale agreement (the “Erf 1210 Sale Agreement”), Erf 1210
(Steelpoort Extension 10) in the KT registration division in the Limpopo
Province (“Erf 1210”) for a total consideration of R10,000,000 (ten million
Rand) and pursuant to the Erf 1212 sale agreement (the “Erf 1212 Sale
Agreement”) a portion of Erf 1212 (Steelpoort Extension 10) in the KT
registration division in the Limpopo Province (“Erf 1212”) for a consideration
of R3,452,000.00 (three million four hundred and fifty two thousand Rand) in
cash (“Cash Consideration”) and collectively referred to as (the “Sale”).
2. RATIONALE FOR THE SALE
The Sale is in line with Freedom’s strategy of divesting of non-core assets
as set out in an announcement released on the Securities Exchange News Service
of JSE Limited (the “JSE”) on 15 March 2016 (the “Announcement”). The proceeds
will be applied within the Group in accordance with the details set out in
the Announcement.
3. BACKGROUND TO THE SELLER AND THE PURCHASERS
3.1. The Company
The Seller is a wholly owned subsidiary of Freedom and the owner of the
Property.
3.2. The Purchaser
The Purchaser is a private company incorporated in South Africa.
4. MATERIAL TERMS OF THE SALE AGREEMENT
4.1. Conditions Precedent
All conditions precedent to the Sale, including approval by the board of
directors of each of the Seller and other than:
- In relation to the Erf 1210 Sale Agreement, the completion of a
satisfactory due diligence in relation to Erf 1210 (“Due Diligence”) by
the Purchaser by 15 March being 30 calendar days following the date of
signature by the Purchaser of the Erf 1210 Sale Agreement;
- In relation to the Erf 1212 Sale Agreement, the rezoning of Erf 1212
and subdivision thereof to create Area B, having same consolidated with
a pre-existing subdivision, the removal of certain servitudes related
to both and the entering into of a lease agreement between the Seller
and the Purchase for certain designated areas of Erf 1212;
- have been fulfilled.
4.2. Sale Consideration
The Cash Consideration will be payable to the Seller on the transfer of
the Property.
4.3. Effective Date
The effective date of the Sale Agreement will be the date of fulfilment
(or waiver, as the case may be) of all of the conditions precedent set out
in paragraph 4.1 above.
4.4. Other
Freedom and the Purchaser have each provided warranties that are standard
to a transaction of this nature.
5. VALUE AND PROFITS ATTRIBUTABLE TO THE PROPERTY
The value of the Property, effective as of 28 February 2015, and as determined
by an external valuer to the Company, Mr JS Bosman (M.I.V) (SA), is as set out
below:
ERF 1210
Title deed number: T35998/2011
Location: Limpopo Province
Sector: Industrial
Original purchase price: R8,536,070
Valuation (2015): R18,058,466
Gross lettable area: 1240
Weighted average rental per square meter: 70
Gross rental income per month: R110,000
Erf 1210 contributed R114,950 to the Group’s earnings and headline earnings
respectively for the year ended 28 February 2015.
ERF 1212
Title deed number: T35998/2011
Location: Limpopo Province
Sector: Industrial
Original purchase price: R8,653,895
Valuation (2015): R18,307,731
Gross lettable area: n.a
Weighted average rental per square meter: n.a
Gross rental income per month: n.a
Erf 1212 is presently zoned as private open space with a total extent of 6.583Ha
and hence is held for development and is not subject to a lease. No costs were
contributed to the Group’s earnings for the year ended 28 February 2015.
6. CATEGORISATION
Due to its relative size to the market capitalisation of Freedom, the Sale is
deemed to constitute a Category 2 transaction under the JSE Listings Requirements.
Johannesburg
20 February 2017
Sponsor
Bravura Capital Proprietary Limited
Date: 21/02/2017 07:05:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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