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OASIS CRESCENT PROPERTY FUND - New Acquisition

Release Date: 29/09/2017 17:05
Code(s): OAS     PDF:  
Wrap Text
New Acquisition

Oasis Crescent Property Fund
A property fund created under the Oasis Crescent
Property Trust Scheme registered in terms of the
Collective Investment Schemes Control Act (Act 45 of 2002)
having REIT status with the JSE Limited (“JSE”)
Share code: OAS
ISIN: ZAE000074332
(“OCPF” or “the Fund”)

NEW ACQUISITION

1.   INTRODUCTION

1.1.   Unitholders are advised that the Fund entered into a sale of shares
       agreement (“Sale Agreement”) with Oasis Crescent Property Company
       Proprietary Limited (“OCPC”) and Eden Court Oasis Property Joint
       Venture Proprietary Limited (“ECOP”) on 29 September 2017, in terms
       of which the Fund will purchase the entire issued share capital of
       ECOP (“Sale Shares”) from OCPC (“Transaction”).

1.2. The Sale Shares will be acquired by the Fund on 1 October 2017
     (“Effective Date”) on the terms set out in the Sale Agreement,
     subject to the Fund obtaining, by that date, in writing, the
     necessary approvals and confirmations from the trustee of the Trust
     regarding the proposed issuing of participatory units, on the basis
     set out in the Sale Agreement.

1.3. ECOP currently holds a 99 year usufruct (“Usufruct”) over land at 32
     Montreal Drive, Cape Town, being Erf 170986, Cape Town on which the
     construction of a modern warehousing facility has recently been
     completed (“Warehouse”), further details of which appear below.

1.4. Post the implementation of the Sale Agreement, ECOP will be 100%
     held by the Fund.

2.   RATIONALE FOR THE TRANSACTION

2.1.   The Transaction will provide the Fund with exposure to a recently
       constructed modern warehouse with strong location advantages.

2.2.   Increasing exposure to high quality strategically located property
       is in line with the Fund’s strategy of growing its direct property
       portfolio with high quality assets that have the potential to attract
       high quality tenants on longer term leases.

3.   PURCHASE PRICE

3.1.   The Fund will acquire the Sale Shares in two tranches for an
       aggregate consideration of R57 000 000(“Sale Price”), as follows:

3.1.1.   the first tranche will comprise 501 ECOP shares (“First Tranche
         Sale Shares”) for a consideration of R31 689 893 (“First Tranche
         Sale Price”); and
3.1.2.   the second tranche will comprise 400 ECOP shares (“Second Tranche
         Sale Shares”) for a consideration of R25 310 107 (“Second Tranche
         Sale Price”).

3.2.   Settlement of the First Tranche Sale Price by the Fund will occur
       as follows:

3.2.1.   R11 689 893 in cash and/or cash equivalent on 2 October 2017
         against the transfer of the First Tranche Sale Shares to the Fund;
         and

3.2.2.   the balance of the First Tranche Sale Price, being an amount of
         R20 000 000, on the later of (i) the business day immediately
         following the payment date for the Fund’s next distribution to its
         unitholders to be paid in December 2017 (“December 2017
         Distribution”) or (ii) 15 December 2017, through the issue of
         participatory units by the Fund to OCPC at an issue price equal
         to the volume weighted average price at which units in the Fund
         traded over:

3.2.2.1.   the 3 business days prior to the declaration date of the December
           2017 Distribution; or

3.2.2.2.   in the event that no OCPF units were traded over the 3 day period
           contemplated in paragraph 3.2.2.1 above, over the 30 business
           days prior to the declaration date of the December 2017
           Distribution,

         with the number of units to be so issued being calculated by
         dividing R20 000 000 by such issue price per unit, adjusted to
         exclude the December 2017 Distribution.

3.3.   Payment of the Second Tranche Sale Price by the Fund will occur in
       cash and/or cash equivalent on the 2 October 2017, after the sale,
       delivery and transfer of the First Tranche Sale Shares has been
       effected and implemented, against the transfer of the Second Tranche
       Sale Shares to the Fund.

4.   RELATED PARTY

     OCPC is a related party of the Fund in terms of the JSE Listings
     Requirements. However, based on the size of the Transaction, relative
     to the Fund’s overall market capitalisation, the Transaction does not
     constitute a related party transaction under the JSE Listings
     Requirements and does not require unitholder approval. This
     announcement is made in terms of paragraph 21.11(c) of the JSE Listings
     Requirements.

5.   INFORMATION RELATING TO THE USUFRUCT AND ECOP

     Information regarding the Usufruct held by ECOP appears in the table
     below:
       Property   Location      Sector    Erf size      GLA      Value of
                                             m2          m2      Usufruct
                                                                    and
                                                                 Warehouse
                                                                     Rm

          32         Cape    Industrial    10 385      5 750        57.0
       Montreal     Town,
        Drive      Western
                     Cape

5.1.    The cost of the Sale Shares is considered to be an amount equal to
        the net asset value of ECOP. The major component of the net asset
        value relates to the value of the underlying Usufruct (together with
        the value of the Warehouse). This has been independently valued at
        R57 000 000 which formed the basis of the valuation used by the
        directors. The directors of Oasis Crescent Property Fund Managers
        Limited are not independent and are not registered as professional
        valuers or as professional associate valuers in terms of the Property
        Valuers Profession Act, No. 47 of 2000.

5.2.    The Warehouse is currently vacant and therefore no profits are
        currently attributable to it.

5.3.    ECOP will, upon implementation of the Transaction, be wholly-owned
        by the Fund. The Fund will accordingly adhere to the provisions of
        paragraph 10.21 of Schedule 10 of the JSE Listings Requirements.


29 September 2017
Cape Town

Designated Advisor
PSG Capital Proprietary Limited

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