IRONGATE GROUP - Irongate Group Receives non-binding, Indicative proposal from Charter Hall Managed Partnership and Cautionary

Irongate Group Receives non-binding, Indicative proposal from Charter Hall Managed Partnership and Cautionary

Irongate Group (JSE: IAP)
Comprising Irongate Property Fund I (IPF I, ARSN 162 067 736) and Irongate Property Fund II (IPF II, ARSN 644 081 309), established in Australia
and registered with ASIC as managed investment schemes
Operated by Irongate Funds Management Limited (ACN 071 514 246; AFSL 290 909) (Responsible Entity)
IPF I is registered as a foreign collective investment scheme in terms of the Collective Investment Schemes Control Act No.45 of 2002
ISIN: AU0000046005
(IAP or the Fund)




Irongate Group receives non-binding, indicative proposal from
Charter Hall managed partnership(1) and cautionary announcement


Irongate Group (IAP) announces that on Saturday 29 January 2022 it received a non-binding,
indicative proposal from a Charter Hall (ASX: CHC) (Charter Hall) managed partnership
comprised of Dutch pension fund PGGM (PGGM) and Charter Hall (together, the Partnership)
to acquire, by way of an agreed trust scheme, all of the stapled securities in IAP for A$1.90
cash per IAP stapled security(2) (Indicative Proposal). Under the terms of the Indicative
Proposal, IAP securityholders will be entitled to retain a distribution for the period ending 31
March 2022 of up to 4.67 cents per stapled security(3).

The Indicative Proposal includes a memorandum of understanding with IAP’s largest
securityholder, 360 Capital(4) (MOU). The MOU contains a call option over 360 Capital’s 19.9%
securityholding in IAP. The MOU also includes standstill and exclusivity provisions in favour of
the Partnership and describes a proposal under which 360 Capital will acquire certain assets
within IAP’s portfolio, IAP’s funds management business and IAP’s co-investment stake in the
ITAP Fund if the Partnership is successful in acquiring IAP. The Indicative Proposal is not
conditional upon 360 Capital completing the acquisitions meaning that the Partnership will retain
responsibility for funding the Indicative Proposal.

The Indicative Proposal indicates that the Partnership expects to fund the Indicative Proposal
from existing financial resources, including existing cash and undrawn and new debt facilities.
Charter Hall and PGGM have received approvals from their relevant Board and Investment
Committees to pursue the transaction.

The IAP Board is considering the Indicative Proposal with the assistance of its advisers.
IAP securityholders do not need to take any action in relation to the Indicative Proposal
and are advised to exercise caution when dealing in their IAP stapled securities.

The Indicative Proposal contains the following conditions:
-     Completion of due diligence to the satisfaction of the Partnership (request for 6-week
      exclusive due diligence period);
-     Final approval of the Partnership boards and investment committees prior to execution of an
      agreed scheme implementation Agreement (SIA);
-     Execution of an SIA on customary terms and conditions including with respect to providing
      exclusivity and deal protection (including a break fee, no talk and no shop);
-     JSE and other regulatory approvals;
-     FIRB approval; and
-    The unanimous recommendation of the IAP Board.

IAP’s advisers are Macquarie Capital (Australia) Limited and J.P. Morgan Securities Australia
Limited as its financial advisers, King & Wood Mallesons as its Australian legal adviser and
Cliffe Dekker Hofmeyr as its South African legal adviser.

A copy of the ASX announcement including the Indicative Proposal and MOU is available for
inspection at https://www2.asx.com.au/markets/company/iap


Footnotes:
(1) This announcement constitutes a cautionary announcement under paragraph 11.40 of the JSE Listings
    Requirements.
(2) Reduced by any subsequent distribution announced or paid in respect of IAP, excluding the distribution for
    the period ending 31 March 2022. A$1.90 per IAP stapled security represents an implied price per IAP
    stapled security in South African Rand of R20.65, based on the South African Rand to Australian Dollar ratio
    of 0.092 as at 28 January 2022.
(3) The distribution for the period ending 31 March 2022 represents the top end of the guidance given to the
    market by IAP on 9 December 2021.
(4) 360 Capital includes 360 Capital Group and 360 Capital REIT



                                                          
31 January 2022

Johannesburg

Sponsor
Investec Bank Limited




                                                                                                               

Date: 31-01-2022 09:12:00
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