PUTPROP LIMITED - Disposal of Grand Central Property

Disposal of Grand Central Property

PUTPROP LIMITED
Incorporated in the Republic of South Africa
(Registration number 1988/001085/06)
Share code: PPR   ISIN: ZAE000072310
(“Putprop” or “the Company”)


DISPOSAL OF GRAND CENTRAL PROPERTY


1. INTRODUCTION AND RATIONALE

  Shareholders are advised that the Company had entered into an agreement to dispose of its Grand
  Central Property (“the Property”) to Phumrello Property Proprietary Limited (“the Purchaser”) for a total
  cash consideration of R18 000 000 (“Disposal Consideration”) (“the Disposal”).

  The nature of business carried out by the current tenant occupying the property is that of an auto body
  repair entity.

  The Property was previously identified as a non-core property due to its location and tenant risk profile
  and the Disposal is consistent with the Company's strategy of disposing of properties situated in nodes
  considered not suitable for future capital growth. The proceeds of the Disposal will be ring-fenced for the
  acquisition of a more strategic income-producing property.



2. THE DISPOSAL


  2.1 Property Specific Information


      Property name:                                              Grand Central
      Location:                                                   290 New Road, Midrand
      Sector:                                                     Retail
      Gross lettable area:                                        3 827m2
      Disposal Consideration:                                     R18 000 000


                                             As at 30 Jun 2020                 As at 31 Dec 2020
       Weighted-average rental               R32,2 m2                          R46,8 m2
       Value attributed to the Property:     R19 553 1541                      R18 000 0002
       Net operating income:                 R1 207 0003,5                     R702 0004, 5


      Notes

      1. The valuation was performed as at 30 June 2020 by JLL South Africa, who is independent from
           the Company and registered as a professional valuer in terms of the Property Valuers
           Profession Act, No. 47 of 2000 (“the Act”).

        2. The valuation as at 31 December 2020 was performed by the board of directors of the Company
            who are not independent, nor registered as professional valuers or as professional associate
            valuers in terms of the Act.

        3. Calculated by taking the rental income of the Property as disclosed in the annual financial
            statements of the Company for the year ended 30 June 2020 and subtracting from it property
            expenses and property recoveries for the same period.

        4. Calculated by taking the rental income of the Property for the six months ended 31 December
            2020, and subtracting from it property expenses and property recoveries for the same period.

        5. The financial information in this announcement is the responsibility of the directors of Putprop
            and has not been reported on or reviewed by a reporting accountant.


There were no transaction costs incurred with the Disposal.


    2.2 Initial Terms of the Disposal

        Putprop and the Purchaser (collectively, “the Parties”) initially entered into an agreement dated 12
        November 2020 (“Agreement”), wherein it was agreed that the Disposal was conditional on the
        Purchaser:

        -   supplying the relevant guarantees for the full Disposal Consideration on or before 15 January
            2021; and

        -   successfully obtaining bond approval for the full Disposal Consideration (“Bond Approval”).


    2.3 Amended Terms of the Disposal

        During February 2021, the Purchaser part paid the Disposal Consideration in the cash amount of
        R5 467 294.24. Consequently, the Purchaser need no longer obtain Full Bond Approval but rather,
        bond approval for the amount of just R12 532 705.76 (“Remaining Amount”).


        Accordingly, the Parties have, as of 8 March 2021, subsequently amended the Agreement by way of
        addendum. It was agreed that:

        -   the condition relating to Bond Approval be waived; and

        -   the Purchaser will now need to supply the relevant bank guarantees for the Remaining Amount
            by no later than 15 March 2021 in order for the Disposal to proceed.

        The Company is pleased to advise shareholders that this last remaining condition precedent has
        been fulfilled with effect from today, and accordingly the effective date of the Disposal is 9 March
        2021.

        With reference to the interim results for the six months ended 31 December 2020 released on SENS
        on 5 March 2021 wherein it was advised, in the “Subsequent Events” section, that the Company had
        already disposed of its Grand Central property during January 2021, shareholders are hereby
        advised that the Disposal is effective today.

   2.4 Representations and warranties

          The agreement in respect of the Disposal contains warranties and undertakings which are standard
          for a disposal of this nature.


3. CLASSIFICATION OF THE DISPOSAL

          The Disposal is classified as a Category 2 transaction in terms of the Listings Requirements of the
          JSE Limited and as such does not require shareholder approval.


Johannesburg
9 March 2021


Sponsor
Merchantec Capital

Date: 10-03-2021 07:05:00
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