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Related Party Acquisition of Glomor Three (Pty) Limited (“Glomor”)
AFINE INVESTMENTS LIMITED
(formerly Domanolor Proprietary Limited)
(Approved as a REIT by the JSE)
(Incorporated in the Republic of South Africa)
Registration number 2020/852422/06
JSE share code: ANI ISIN: ZAE000303947
(“Afine” or “the Company”)
RELATED PARTY ACQUISITION OF GLOMOR THREE (PROPRIETARY) LIMITED (“Glomor”)
1. The Acquisition
Shareholders are advised that Afine has concluded an agreement (“the Agreement”) with
Petroland Group Proprietary Limited (“Petroland”) and Terra Optimus Proprietary Limited
(“Terra Optimus”) (collectively “the Vendors”) in terms of which Afine will acquire 100% of
the shares in Glomor (“the Acquisition”).
Glomor 3 owns two properties namely Portion 112 Of Farm Middelvlei 255, IG Division,
Gauteng Province Main Reef Road (R28), Randfontein ("Engen Property") and Remainder
Erf 438 Rocky Drift, JT Division, Mpumalanga Province situated alongside R40, Axis Industrial
Park, White River (“Sasol Property”).
One of the vendors, Petroland, is a related party to the Company in terms of the Listings
Requirements of the JSE Limited (“JSE”) as it is held by the family trust of Mr A Loubser, who
is the Chief Executive Officer of Afine. The Acquisition is therefore classified as a related
party transaction in terms of paragraph 21.12(b) of the JSE Listings Requirements. Terra
Optimus is owned by The Gary du Preez Family Trust, and is not a related party to Afine.
The purchase consideration will be settled with a combination of cash and Afine shares.
Accordingly, in terms of paragraph 10.7(b) of the JSE Listings Requirements, an independent
expert acceptable to the JSE must express an opinion on the fairness of the Acquisition
(“Fairness Opinion”).
Following the completion of the Acquisition, Petroland and Terra Optimus will hold an interest
of 6.22% and 5.55% in Afine respectively.
2. Rationale for the Acquisition
One of Afine’s stated objectives at the time of listing was to operate as a specialist REIT with
a focus on the acquisition of petrol stations. The acquisition of Glomor is the first acquisition
of two properties in line with the expansion strategy.
3. Effective date of the acquisition
The effective date of the Acquisition is 1 March 2022.
4. Details of the business of Glomor and property information
Glomor is 50% owned by Petroland and 50% by Terra Optimus and holds two petrol station
properties with long term leases with Sasol and Engen.
The property information is set out below:
Details Engen Property Sasol Property
Location Main Reef Road, White River,
Randfontein Mpumalanga Province
Rentable area, including forecourt 574m2 668m2
and auto tellers
Weighted average rental per R409.33 R351.73
square metre for the rentable area
Valuation R31 100 000 R28 500 000
Valuation date 28 February 2022 28 February 2022
Date of valuation report 22 April 2022 21 April 2022
It is noted that the weighted average rental per square metre is not a normal metric for a
petrol station as the entire site is rented by the oil major, irrespective of the size of the land.
Accordingly, only the rentable area, including the forecourt, has been presented above.
The properties were independently valued by Appraisal Corporation CC, an external
property valuer, whose members are duly registered with the South African Council for the
Property Valuers Profession, in terms of Section 20(2)(a) of the South African Property Valuers
Profession Act, 2000.
As Afine is acquiring the shares in Glomor 3, there are no property transfer costs payable.
No agent’s commission is payable in relation to the Acquisition.
5. Purchase consideration
The purchase consideration will be settled with a combination Afine shares and cash as
follows:
- issue of 4 512 195 Afine shares to Petroland;
- issue of 4 024 390 Afine shares, plus R2 000 000 (two million Rand) in cash, to Terra
Optimus.
The exchange of 100% of the Glomor shares held collectively by the Vendors for shares in
Afine in this asset-for share transaction is in accordance with the terms of the Agreement
and section 42 of the Income Tax Act No. 58 of 1962, as amended.
The new shares in Afine will be issued ex-dividend.
6. Conditions precedent
The acquisition is subject to the outcome of the Fairness Opinion referred to in paragraph 9
below.
7. Other significant terms of the Agreement
The Agreement provides for warranties and indemnities that are normal for a transaction of
this nature.
8. Glomor financial information
For the 12 month period ended 28 February 2022, being the latest available set of audited
annual financial statements (“AFS”), the value of the net assets of Glomor that will be
acquired by Afine was R29 682 805 and profit after taxation was R22 115 030. The two
underlying properties were independently valued by Appraisal Corporation CC at
R28 500 000 for the Sasol Property and R31 100 000 for the Engen Property. It is noted that a
portion of the deferred tax liability of R9 489 781, which is related to the properties will be
reversed following the acquisition by Afine.
The information contained in the AFS was prepared in accordance with IFRS for Small and
Medium Enterprises and the auditor is Lloyd Viljoen, a registered auditor. The Board of Afine
is satisfied that the audited financial information is reliable. The audit opinion is unmodified.
The financial information contained in this announcement has not been reviewed or
reported on by the Company’s auditors.
9. Fairness opinion
In terms of paragraphs 21.12 and 10.7(b) of the JSE Listings Requirements, an independent
expert acceptable to the JSE (“Independent Expert”) must express an opinion on the fairness
of the Acquisition (“Fairness Opinion”) as far as it pertains to the Related Party. To this end,
the Company appointed AcaciaCap Advisors Proprietary Limited as the Independent
Expert. The Fairness Opinion has been submitted to the JSE for review and a subsequent
announcement in this regard will be made in due course. The Acquisition will only require
approval by Afine shareholders in the event that the Independent Expert determines that
the terms of the Acquisition from the Related Party are unfair as far as shareholders are
concerned.
By order of the Board
13 June 2022
Designated Advisor
AcaciaCap Advisors Proprietary Limited
Date: 13-06-2022 08:15:00
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