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SFA
SFA
SFA - Shops for Africa - Announcement Regarding The Acquisition Of Erf 205
And Erf 211 Roggebaai
Shops for Africa Limited
Incorporated in the Republic of South Africa
Registration number 2000/018084/06
Share code: SFA & ISIN: ZAE000031241
("Shops" or "the Company")
ANNOUNCEMENT REGARDING THE ACQUISITION OF ERF 205 AND ERF 211 ROGGEBAAI
1. Introduction
Shops shareholders are advised that, in line with the current strategy, the
Company has entered into an agreement dated 4 September 2007 ("the Agreement")
with Health and Racquet Club Property Participation Limited ("Health and
Racquet" or "the vendor") to acquire erf 205 Roggebaai together with the
leasehold rights over erf 211 Roggebaai in the area of the Transitional
Metropolitan Sub-structure of Cape Town, in extent 1,250m2 and 1,169 m2 ,
currently occupied by Virgin Active South Africa (Proprietary) Limited ("the
property"), ("the acquisition"). The acquisition is effective from the date of
transfer of the property, which is expected to be on or shortly before 1
December 2007.
2. Rationale for the acquisition
The acquisition has been made in line with Shops` strategy to grow the property
portfolio and to create a leading South African property investment and
development company by the acquisition of high quality properties as and when
the opportunity arises, creating diversity of risk in sectoral, geographical and
tenant exposure.
The property is considered to be let at rental levels which are significantly
below market whilst additional bulk is available on the site for future
development. The building is strategically situated close to the Cape Town
International Convention Centre.
3. Consideration for the acquisition
The consideration for the acquisition is R30 000 000 to be funded by a
combination of internal cash resources of R16 196 421 and borrowings of
R13 803 579.
The value attributable by Mills Fitchet Magnus Penny an external independent
valuer registered as a professional valuer in terms of the Property Valuers
Profession Act No. 47 of 2000 is R30 165 000
4. Financial information relating to the acquisition
The financial effects of the acquisition on Shops` net asset value per share has
not been disclosed as the effects are not material.
Forecast information for the nine months ending 31 August 2008 and the 12 months
ending 31 August 2009 is set out below. The forecast financial information has
not been reviewed or reported on by Shops` auditors in terms of Section 8 of the
JSE Limited Listings Requirements ("Listings Requirements").
Forecast 9 Forecast 12
months ending months ending
31 August 31 August 2009
2008
Gross rental revenue (R`000) 1 802 2 404
Net rental income less expenses
before finance costs (R`000) 1 785 2 379
Net loss after tax (R`000)
650 867
Loss per Shops share (cents) 0.11 0.13
Headline loss per Shops share 0.11
(cents ) 0.13
Weighted average number of Shops
shares in issue 595 426 227 643 000 000
Notes: Based on the actual number of 643 000 000 shares in issue
5. Suspensive conditions of the acquisition
All the suspensive conditions pertaining to the acquisition of the property have
been fulfilled.
6. Property details
Details regarding the property are set out below:
Property Location Sector Gross Single or Weighted Vacancy
lettable multi average by
area tenanted rental rentable
m2 per m2 area
R m2
erf 205 Cape Town Retail/ 3 682 Single 54.54 0%
and 211 Gym tenanted
Roggebaai
7. Categorisation of the acquisition
The acquisition is a Category 2 transaction in terms of the Listings
Requirements.
Cape Town
19 October 2007
Investment bank and sponsor
Nedbank Capital
Date: 19/10/2007 16:44:15 Produced by the JSE SENS Department.
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