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DIV
DIV
DIV - Diversified - Acquisition of The Village Walk
Diversified Property Fund Limited
(Incorporated in the Republic of South Africa)
Registration number 2005/029685/06
Share code: DIV & ISIN: ZAE000072369
("Diversified" or "the company")
ACQUISITION OF THE VILLAGE WALK
DEVELOPMENT OF THE VILLAGE WALK
INTRODUCTION
Linked unitholders are advised that Diversified has (via its wholly-owned
subsidiary Diversified Properties 2 (Proprietary) Limited) entered into
agreements to acquire land ("the property") and fund the development of a
retail centre to be known as The Village Walk ("the development"), to be
constructed in Kathu in the Northern Cape, at a cost of approximately R134,6m
("the transaction"). The centre is due for completion in November 2008.
DETAILS OF AND RATIONALE FOR THE TRANSACTION
The transaction is in line with Diversified`s strategy of investing in new
retail developments.
In terms of the land purchase agreement, Diversified will acquire 100% of
Erven 5170 and 7319, Kathu. Upon successful completion of the development,
Diversified will own 100% of this 19 824m2 retail centre which will be
anchored by Spar and will include most major national clothing retailers. The
development agreement provides Diversified with a guaranteed yield of 9% per
annum and Diversified is therefore not exposed to any development risk. The
average monthly rental attributable to the development is expected to amount
to R60.63 per m2.
The land purchase agreement and the development agreement were entered into
with Belvedere Investments (Pty) Ltd on 14 August 2007.
Diversified`s directors are of the opinion that the cost of the development
represents its fair value.
CONSIDERATION AND FINANCIAL EFFECTS
The consideration will be funded from the company`s existing borrowing
facilities and is payable in cash as follows:
approximately R6,3 million on transfer of the property into Diversified`s
name; and
the balance upon receipt of progress certificates.
The transaction has no material effect on earnings per linked unit, headline
earnings per linked unit and distribution per linked unit for the year ended
30 June 2007, and no material effect on net asset value per linked unit and
net tangible asset value per linked unit as at 30 June 2007, and these
effects are therefore not disclosed.
CATEGORISATION OF THE TRANSACTION
The transaction has been categorized as a category 3 transaction in terms of
section 9.5(a) of the JSE Listings Requirements.
Johannesburg
15 August 2007
Sponsor
Java Capital (Proprietary) Limited
Date: 15/08/2007 15:16:03 Produced by the JSE SENS Department.
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