| Thu 28 Jun 2007, 11:09 | | SKJ - Sekunjalo - Acquisition of Sekunjalo House |
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SKJ
SKJ
SKJ - Sekunjalo - Acquisition of Sekunjalo House, Block F, The Terraces,
Tokai
Sekunjalo Investments Limited(Incorporated in the Republic of South
Africa)(Registration number 1996/006093/06)Share code: SKJ & ISIN:
ZAE000017893("Sekunjalo" or "the company")
ANNOUNCEMENT REGARDING THE ACQUISITION OF SEKUNJALO HOUSE, BLOCK F, THE
TERRACES, TOKAI
IntroductionSekunjalo has entered into an agreement, dated 9 March 2007
with Market Demand Trading 190 (Proprietary) Limited, National Pride
Trading 216 (Proprietary) Limited and Great Force Investments (Proprietary)
Limited ("the vendors") to acquire the 3 portions of Sekunjalo House ("the
property"), Block F, The Terraces, Tokai ("the Sekunjalo House
acquisition"). The company indirectly owns 25% of the vendors, through its
investment in Gemini Moon Trading 137 (Proprietary) Limited ("Gemini
Moon").
Rationale for the Sekunjalo House acquisitionSekunjalo House currently
houses the company`s head office and over the last year has been the place
to which the group has consolidated its rental premises in Cape Town. The
vast majority of the building is currently being let by Sekunjalo
companies. The group has taken a longer term view on the transaction and
believes this is not only an opportunity to invest in property, but one to
leverage a large slice of its rental expense into a property that would
benefit the group through capital growth in the future.
Property details, consideration and settlement
The property consists of offices of 1 758 square metres in size, as well as
42 parking bays and two store rooms. The total consideration for the
Sekunjalo House acquisition is R19.2 million for the building and
occupational rental for the 6 months to 28 February 2007. The consideration
will be settled via cash of R12 million and a share issue of 9 million
shares at 80c per share for the remaining R7.2 million. The initial
agreements of the Sekunjalo House acquisition were signed on 23 November
2006 and by means of addenda, it was concluded on 9 March 2007. The
transfer of the property into the name of the company took place on 22 June
2007.
Pro forma financial effects of the Sekunjalo House acquisitionThe unaudited
pro forma financial effects of the Sekunjalo House acquisition on
Sekunjalo`s earnings, headline earnings, net asset value ("NAV") and
tangible NAV per ordinary share are set out below. The unaudited pro forma
financial information has been prepared for illustrative purposes only and,
because of its of nature, may not give a true picture of Sekunjalo`s
financial position and results of operations. The preparation of the pro
forma financial effects is the responsibility of Sekunjalo`s directors.
Per Sekunjalo Interim results Sekunjalo House Percentage
ordinary share
(Cents)
at 28 Feb 2007 acquisition change (%)
impact
NAV for the group 101.62 101.72 0.09
Tangible NAV for 69.59 70.39 1.15
the group
Shares in issue 396,795 405,795
(000`s)
Weighted shares in issue (000`s) 370,829 379,829
Notes:1.) Based on Sekunjalo`s audited NAV and tangible NAV for the 6
months
ended 28 February 2007. The financial effects of the Sekunjalo House
acquisition on earnings and headline earnings are not material.2.)
Based on the assumption that the Sekunjalo House acquisition was affected
on 1 September 2006 for income statement purposes; and 28 February 2007 for
balance sheet purposes3) Based on the shares in issue on the 28 February
2007
4 Based on the 9 million shares being issued for the Sekunjalo House
acquisition and being weighted in full
5 Based on a dividend declared from the investment in Gemini
MoonConditions precedent of the Sekunjalo House acquisition and other
conditions
There are no conditions precedent relating to the Sekunjalo House
acquisition.
Categorisation of the Sekunjalo House acquisitionThe Sekunjalo House
acquisition is a Category 3 transaction in terms of the JSE Listings
Requirements.
Cape Town28 June 2007
SponsorAbsa Capital - a division of Absa Bank Limited
Date: 28/06/2007 11:09:01 Produced by the JSE SENS Department.
