FREEDOM PROPERTY FUND LIMITED - Disposal of properties by Zambesa Investments Proprietary Limited, a wholly owned subsidiary of Freedom

Release Date: 15/08/2018 13:49
Code(s): FDP
 
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Disposal of properties by Zambesa Investments Proprietary Limited, a wholly owned subsidiary of Freedom

FREEDOM PROPERTY FUND LIMITED
Incorporated in the Republic of South Africa
Registration number: 2012/129186/06
Share code: FDP
ISIN: ZAE000185260
(“Freedom” or “the Company” or “the Group”)

DISPOSAL OF PROPERTIES BY ZAMBESA INVESTMENTS PROPRIETARY LIMITED, A WHOLLY OWNED
SUBSIDIARY OF FREEDOM


1. INTRODUCTION

Shareholders are advised that Zambesa Investments Proprietary Limited, a wholly owned subsidiary
of Freedom, has signed an Offer to Purchase (“Offer”) submitted by Dr. Katlego Pholoana (“Purchaser”)
to acquire 8 residential units and 33 service stands situated in Burgersfort, collectively known as the
Tubatse Homes (“the Property”) (the “Sale”).


2. RATIONALE FOR THE SALE

The Sale is in line with Freedom’s strategy of divesting of non-core assets as communicated to
shareholders on 15 March 2016.

The proceeds from the sale of the Property will be utilised to reduce debt in the Group, in particular,
mortgage bonds held with Nedbank.


3. PURCHASE CONSIDERATION

The total purchase consideration is R12.6 million (exclusive of Value Added Tax), settled in cash as
follows
       • a deposit of R2.52 million being paid by 20 August 2018; and
       • the balance of R10.08 million being paid by 27 August 2018.

The Sale has been concluded “voetstoots”, save for warranties that are standard in respect of a
transaction of this nature.


4. INFORMATION RELATING TO THE PROPERTY

The Property specifics are as follows:

 Location:                   Erven 5973 and 5974, Burgersfort Extension 40, Limpopo Province
 Rentable area:              1255 square metres
 Valuation: (Note 1)         R14.35 million
 Weighted average rental     Nil – No rental activity on the property is currently undertaken.
 per square metre for the
 rentable area: (Note 2)
 Original purchase price:    R17.67 million
 Date initially acquired:    20 March 2014

 Note 1 – An independent external valuation was obtained from Real Insights Proprietary Limited in
 respect of the Property (“Independent Valuation”), which valuation was undertaken by TLJ Behrens
 and HN Hartman (Professional Associated Valuer and Professional Valuer, respectively), registered
 without restriction in terms of the Property Valuers Profession Act, No. 47 of 2000. The value
 attributed at 28 February 2018 has been derived from the comparable sales method of valuation.

 Note 2 – The Property is currently no longer being rented out hence the weighted average rental per
 square metre for the rentable area is nil.


5. EFFECTIVE DATE

The effective date of the Sale will be the date of registration of the transfer of the Property into the
name of the Purchaser. The Sale is not subject to any further conditions.


6. VALUE OF NET ASSETS AND PROFIT ATTRIBUTALE TO THE PROPERTY

The value of the Property is R14.35 million in terms of the Independent Valuation.

Rental income to the value of R278 719 was generated by the Property during the financial year ended
28 February 2018, based on the unaudited management accounts of Freedom, reported in accordance
with the International Financial Reporting Standards. Freedom is satisfied with the quality of the
management accounts.

Freedom is satisfied with the Independent Valuation.


7. CATEGORISATION

In terms of the JSE Limited Listings Requirements, the Sale is a Category 2 transaction and accordingly
does not require approval by shareholders.



Paarl
15 August 2018

Sponsor and Corporate Advisor
Questco Corporate Advisory Proprietary Limited

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