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Proposed disposal of 7 properties for an aggregate consideration of R2.189 billion
REBOSIS PROPERTY FUND LIMITED
(Incorporated in the Republic of South Africa)
(Registration number: 2010/003468/06)
JSE share codes:
REA ISIN: ZAE000240552
REB ISIN: ZAE000201687
Alpha code: REBI
(Approved as a REIT by the JSE)
(“Rebosis” or the “Company”)
PROPOSED DISPOSAL OF SEVEN PROPERTIES FOR AN AGGREGATE CONSIDERATION OF R2.189 BILLION
1. Introduction and rationale
Rebosis shareholders are hereby advised that the Company has itself, and through its wholly-owned
subsidiary Ascension Properties Limited (“Ascension”) (as the context may require, the “Seller”),
entered into three sale and purchase agreements dated 29 and 30 November 2018 to dispose of seven
properties (“Properties”) in its office portfolio (the “Disposals”) to various empowerment consortia,
further demonstrating Rebosis’ commitment to transformation in the property sector.
The Disposals, comprising of office buildings, forms part of the Company’s strategy to be a retail-
focused fund and to reduce the Company’s gearing in line with the road-map outlined in the results
announcement released on the Stock Exchange News Service on 12 November 2018. The proceeds of
the Disposal will be used to reduce the existing debt of the Company. The Disposals will become
effective on the date of registration of transfer of the Properties into the names of the respective
purchasers (“Transfer Date/s”).
2. The Disposals
2.1 The Aventro Disposal
Aventro Properties Proprietary Limited (“Aventro” or, as the context may require, the “Purchaser”) is
a women led 100% black owned and managed company, currently pursuing Property and Social
Infrastructure Developments, and is represented by Mrs Tebogo Nkosi, Ms Joan Madibeng and Mr
Mncedisi Ndlovhu.
In terms of an agreement concluded between Rebosis and Aventro, Rebosis has agreed to dispose of
two properties: Erf 1264 Marshalls Town, Johannesburg (“124 Main”) and Erf 1183, Marshalls Town,
Johannesburg (“18 Rissik”) to Aventro (“Aventro Disposal”) for an aggregate consideration of the
lesser of (i) R894,600,000 (inclusive of VAT at zero percent), or (ii) 9.75% yield on the 12 months
forward net income of the market related rental on lease renewals achieved with the tenant. The
maximum consideration attributable to 124 Main is R556,100,000 and to 18 Rissik is R328,500,000.
2.2 The Endless Fortune Disposal
Endless Fortune Proprietary Limited (“Endless Fortune” or, as the context may require, the
“Purchaser”) is a 100% black owned company, that is actively acquiring Government tenanted
portfolios, and is represented by Mr Mpho Maerane.
In terms of an agreement concluded between Rebosis and Endless Fortune, Rebosis has agreed to
dispose of two properties: Erf 1271, Erf 191 and Portions 2,4, 5 and the remaining extent of Erf 1021
Marshalls Town, Johannesburg, (“28 Harrison”) and Erf 2950 Pretoria (“189 Schoeman”) to Fortune
(“Endless Fortune Disposal”) for an aggregate consideration of the lesser of (i) R588,840,872 (inclusive
of VAT at zero percent), or (ii) 9.75% yield on the 12 months forward net income of the market related
rental on lease renewals achieved with the tenant. The maximum consideration attributable to 28
Harrison is R230,640,872 and to 189 Schoeman is R358,200,000.
2.3 The Lunar Stone Disposal
Lunar Stone Trading Proprietary Limited (“Lunar Stone” or, as the context may require, the
“Purchaser”) is a 100% black owned and managed company, seeking to acquire and develop a large
unlisted sovereign-focused property fund, and is represented by Mr Lemane Bridgman Sithole.
In terms of an agreement concluded between Rebosis and Lunar Stone Trading, Ascension has agreed
to dispose of three properties: Erf 5327, Johannesburg, (“Bathopele Building”), Erven 676 and 4677,
Johannesburg (“Game Building”) and Erf 1236 Marshalls Town, Johannesburg (“Surrey House”) to
Lunar Stone (“Lunar Stone Disposal”) for an aggregate consideration of the lesser of (i) R551,449,864
(inclusive of VAT at zero percent), or (ii) 9.75% yield on the 12 months forward net income of the
market related rental on lease renewals achieved with the tenant. The maximum consideration
attributable to Bathopele Building is R160,498,964, Game Building is R298,800,000 and Surrey House
is R246,600,000.
2.4 The consideration payable for the Disposals
The considerations payable for the Disposals are payable as follows:
- 20% payable by way of a vendor loan granted by Rebosis to relevant Purchaser at an annual
interest rate of 9.75% serviced quarterly in advance on an interest only basis, with an initial loan
term of 36 months and secured by a second covering mortgage bond registered in favour of
Rebosis (“Vendor Loan Agreement”); and
- the balance payable in cash on the Transfer Date.
Should the Transfer Date be later than 1 May 2019, the relevant consideration will accrue interest at
9.75%, calculated and expressed as an effective daily rate.
2.5 Warranties
The three agreements governing the Disposals contain representations and warranties by the Seller in
favour of the relevant Purchaser which are standard for transactions of this nature.
3. The Properties and related financial information
Property information
Property Location Sector Gross Single or Weighted Value of
lettable multi- average the
area tenanted gross Properties*
rental per
m2
(m2) (R) (R’m)
124 Main Street CBD, Office 20 818 Single 169.2 629
Johannesburg tenanted
18 Rissik Street CBD, Office 11 204 Single 223.6 365
Johannesburg tenanted
28 Harrison Street CBD, Office 20 984 Multi- 96.2 250
Johannesburg tenanted
189 Schoeman CBD, Pretoria Office 19 332 Multi- 124.0 398
Street tenanted
Bathopele Building CBD, Office 11 500 Single 119.6 173
Johannesburg tenanted
Game Building CBD, Office 21 438 Multi- 120.7 332
Johannesburg tenanted
Surrey House CBD, Office 11 840 Multi- 146.4 274
Johannesburg tenanted
*The value of the Properties has been extracted from the Company’s reviewed provisional results
for the year ended 31 August 2018, which have been prepared in terms of IFRS. The valuations were
performed by LDM Valuation Solutions (Pty) Ltd, who is independent from the Company and
registered as a professional valuer in terms of the Property Valuers Profession Act, No. 47 of 2000.
Financial information
Net profit after tax 12 months ended 31 August 2018
(R’m)
Aventro Disposal 91.3
Endless Fortune Disposal 55.9
Lunar Stone Disposal 74.4
The financial information provided above, which has been extracted from the Company’s reviewed
provisional results for the year ended 31 August 2018 and is prepared in terms of IFRS, is the
responsibility of the directors of Rebosis and has not been reported on or reviewed by a reporting
accountant.
4. Conditions precedent
The Disposals are subject to the fulfilment of the following outstanding conditions precedent:
4.1 within 5 business days of the signature of the relevant agreement, the Rebosis board of directors
and the board of directors of the relevant Purchaser have approved the Disposals;
4.2 by no later than 28 February 2019, the relevant Purchaser has completed a due diligence
investigation, to its satisfaction;
4.3 by no later than 31 January 2019, the relevant Purchaser has furnished the Seller with confirmation
of funding from an acceptable financial institution as regards the consideration payable on the
respective Transfer Dates;
4.4 by no later than 31 March 2019, the relevant Purchaser has furnished the Seller with a guarantee/s
from an acceptable financial institution as regards the consideration payable on the respective
Transfer Dates;
4.5 by no later than 14 March 2019, the Seller and the respective Purchasers have entered into the
Vendor Loan Agreements and all conditions to which the agreements are subject have been
fulfilled; and
4.6 by no later than 31 March 2019, and only to the extent if legally required, the relevant Competition
authority approves the Disposal/s.
5. Categorisation
Each of the three Disposals constitute a Category 2 transaction for Rebosis in terms of the JSE Limited
Listings Requirements, which merely require an announcement.
Johannesburg
3 December 2018
Investment Bank, Corporate Advisor, and Equity and Debt Sponsor
Nedbank Corporate and Investment Banking, a division of Nedbank Limited
Date: 03/12/2018 07:05:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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