GREENBAY PROPERTIES LIMITED - Return of capital to Greenbay shareholders

Release Date: 07/09/2018 14:00
Code(s): GRP
 
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Return of capital to Greenbay shareholders

GREENBAY PROPERTIES LTD
(Incorporated in the Republic of Mauritius on 14 August 2014)
(Registration number C124756 C1/GBL)
SEM share code: GFP.N0000
JSE share code: GRP
ISIN: MU0461N00007
("Greenbay" or "the company")


RETURN OF CAPITAL TO GREENBAY SH AREHOLDERS


1.    INVESTMENT STRATEGY AND RETURN OF SURPLUS CAPITAL TO SHAREHOLDERS

      In the company's interim financial statements for the three and nine months ended 30 June 2018, released on
      SENS and published on the SEM website on 8 August 2018, Greenbay confirmed that direct and indirect
      property holdings will constitute the majority of the company's investments.

      Following this determination the board has evaluated its capital requirements and the company's strategies in
      respect of investments in listed equities.

      On an assessment of the market opportunities and risks relating to its equity strategies, the board has determined
      to realise its profits on listed equities and reduce its gearing.

      The company continues to evaluate opportunities for direct property investments and is currently in advanced
      negotiations regarding possible direct retail property opportunities.

      In these market conditions, and taking into account the current pipeline of direct property opportunities, the
      board has determined that the company has capital surplus to its requirements in the next 12 months and has
      resolved to return such surplus capital to shareholders in an efficient manner.

      After considering a proposal for a pro rata share repurchase of up to 30% of its shares in issue, Greenbay has
      determined that a simpler and more efficient mechanism to return surplus capital would be by way of a pro rata
      capital payment to shareholders.

      Accordingly, Greenbay intends to make a capital payment of EUR300 million to Greenbay shareholders by way
      of a return of capital of 3,16185 Euro cents for every Greenbay share held on Friday, 12 October 2018 (the
      "record date") (the "return of capital"). Shareholders should note that the company's current repurchase
      programme will remain in place.

      The Greenbay board proposes a consolidation of the company's issued shares. A circular to shareholders in this
      regard is in the process of being prepared and will be distributed in due course.

2.    SALIENT DATES AND TIMES

      2.1       Shareholders on the South African register

                                                                                                                  2018
                Finalisation announcement, including the EUR to ZAR exchange rate, in               Tuesday, 2 October
                respect of the return of capital published on SENS (by 11:00)
                Last day to trade in Greenbay shares in order to receive the return of capital      Tuesday, 9 October
                Trading in Greenbay shares 'ex' the entitlement to receive the return of         Wednesday, 10 October
                capital
                Record date for the return of capital                                               Friday, 12 October
                Payment of return of capital                                                        Monday, 15 October
                Notes:
                1. The above dates and times are South African dates and times and are subject to amendment. Any
                   such amendment will be released on SENS.                                                                                                              
                2. Transfers of shares between sub-registers in South Africa and Mauritius may not take place
                   between Tuesday, 2 October 2018 and Friday, 12 October 2018, both days inclusive.
                3. Greenbay shares may not be dematerialised or rematerialised between Wednesday,10 October 2018 and 
                   Friday, 12 October 2018, both days inclusive.
                4. Shareholders who hold their Greenbay shares on the South African share register will receive the
                   return of capital in South African Rand, based on the exchange rate to be announced by Greenbay
                   on 2 October 2018.

     2.2       Shareholders on the Mauritian register

                                                                                                                 2018
               Finalisation announcement, including the EUR to ZAR exchange rate, in               Tuesday, 2 October
               respect of the return of capital published on the SEM website (by 13:00)
               Last day to trade in Greenbay shares in order to receive the return of capital      Tuesday, 9 October
               Trading in Greenbay shares ‘ex’ the entitlement to receive the return of         Wednesday, 10 October
               capital
               Record date for the return of capital                                               Friday, 12 October
               Payment of return of capital                                                        Monday, 15 October
               Notes: 
               1. The above dates and times are Mauritian dates and times and are subject to amendment. Any such
                  amendment will be published on the SEM website.
               2. Transfers of shares between sub-registers in South Africa and Mauritius may not take place
                  between Tuesday, 2 October 2018 and Friday, 12 October 2018, both days inclusive.
               3. Greenbay shares may not be dematerialised or rematerialised between Wednesday, 10 October 2018
                  and Friday, 12 October 2018, both days inclusive.
               4. Shareholders who hold their Greenbay shares on the Mauritian share register will receive the
                  return of capital in Euro.

3.   IMPLEMENTATION OF THE RETURN OF CAPITAL

     Pursuant to the return of capital, Greenbay shareholders will receive 3,16185 Euro cents for every one Greenbay
     share held on the record date.

     Shareholders who hold their Greenbay shares on the South African share register will receive the return of
     capital in Rands, based on the EUR to ZAR exchange rate announced on SENS on Tuesday, 2 October 2018.
     Shareholders who hold their Greenbay shares on the Mauritian share register will receive the return of capital in
     Euro.

     The return of capital is conditional, to the extent required, upon Greenbay obtaining:

     -     exchange control approval for the return of capital; and
     -     approval from other regulators required to effect the return of capital.

     These fulfilment of these conditions is required before the release of the finalisation announcement on SENS
     and published on the SEM website.

     The return of capital is not subject to shareholder approval or further regulatory approvals.

4.   TAX IMPLICATIONS

     4.1      South Africa
              The statements in this section relate only to certain limited aspects of the South African taxation of the
              return of capital by Greenbay. Shareholders should note that the summary is a general guide to the
              South African tax regime currently in place and is not exhaustive. Greenbay shareholders are advised
              to consult their professional advisors regarding the tax consequences of the return of capital. This
              section does not constitute advice and applies only to South African tax resident shareholders who are
              the beneficial owners of the shares and relevant distributions and applies only in relation to shares that
              are listed on the JSE.
              
              In respect of South African tax resident shareholders ("resident shareholders") the return of capital
              will constitute an amount paid by Greenbay in respect of a share in Greenbay and that amount is
              treated for Mauritian income tax purposes as a distribution or similar payment (other than an amount
              that constitutes a dividend or similar payment) and will as such constitute a "foreign return of capital"
              as defined in section 1 of the South African Income Tax Act., No. 58 of 1962 (the "SA Income Tax Act").

              In terms of paragraph 76B of the Eighth Schedule to the SA Income Tax Act such shareholders will be
              required to reduce the base cost of their Greenbay shares with the amount of the foreign return of
              capital (being 3,16185 Euro cents per Greenbay share). If the amount of the foreign return of capital
              exceeds the base cost of the Greenbay shares in the hands of the resident shareholder, the excess will
              constitute a capital gain in the hands of the shareholder and the shareholder must account for capital
              gains tax on such capital gain, unless the shareholder can rely on a capital gains tax exemption. In
              terms of paragraph 64B(4) of the Eighth Schedule to the SA Income Tax Act, a shareholder that holds
              at least 10% of the shares and voting rights in Greenbay (whether alone or together with any other
              person forming part of the same group of companies as the shareholder) must disregard any capital
              gain in respect of the foreign return of capital – such a shareholder is accordingly effectively exempt
              from capital gains tax in respect of the foreign return of capital.

              Shareholders with an exempt tax status should consider whether the capital gains tax exemptions
              applicable to them will extend to exempt a capital gain made in respect of the foreign return of capital.

              A foreign return of capital is not subject to dividends tax.

              Non-South African tax resident shareholders should only be subject to South African tax in respect of
              the return of capital if they have a permanent establishment in South Africa in which case they should
              seek professional advice.

      4.2     Mauritius
              The return of capital may have tax implications for shareholders holding Greenbay shares on the
              Mauritian share register. Shareholders who hold their Greenbay shares on the Mauritian share register
              are advised to consult their professional advisors regarding the tax consequences, if any, of the return
              of capital should they be in any doubt as to the appropriate action to take.


5.    SOUTH AFRICAN EXCHANGE CONTROL REGULATIONS

      The following is intended only as a guide and is therefore not a comprehensive statement of the Exchange
      Control Regulations of South Africa issued under the Currency and Exchanges Act, 1933, as amended
      ("Exchange Control Regulations"), and is applicable to shareholders holding shares traded on the JSE only.

      All aspects relating to the Exchange Control Regulations will be managed by a shareholder's CSDP or broker.
      Shareholders who are in any doubt as to the appropriate course of action to take should consult their CSDP,
      broker or other professional advisors.

      The return of capital payable to an emigrant from the Common Monetary Area will be forwarded to the
      authorised dealer in foreign exchange controlling the emigrant's remaining South African assets for credit to the
      emigrant's blocked accounts.

      Payments to non-residents are freely transferable from South Africa.

The Company has primary listings on both the Official Market of the SEM and the Main Board of the JSE.


7 September 2018

By order of the Board
  
                                                                                                              
This notice is issued pursuant to SEM Listing Rule 11.3 and Rule 5(1) of the Securities (Disclosure Obligations of
Reporting Issuers) Rules 2007. The Board accepts full responsibility for the accuracy of the information in this
announcement.

For further information please contact:


JSE sponsor
Java Capital                                                               
Tel: +27 11 722 3050                                                


SEM authorised representative and sponsor
Perigeum Capital
Tel: +230 402 0890 
 

Company Secretary
Intercontinental Trust Ltd
Tel: +230 403 0800

Date: 07/09/2018 02:00:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
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