| Wed 26 Mar 2008, 16:45 | | APA / APA / AXC - ApexHi - Disposal to Mergence Africa Property Investment Trust |
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APA
APA / APA / AXC - ApexHi - Disposal to Mergence Africa Property Investment Trust
ApexHi Properties Limited
(Incorporated in the Republic of South Africa)
Registration number 1999/000238/06
Share codes: APA ISIN codes: ZAE000083598
APB ZAE000083606
AXC ZAE000083580
("ApexHi")
DISPOSAL TO MERGENCE AFRICA PROPERTY INVESTMENT TRUST
Unitholders are advised that ApexHi has reached agreement to dispose of a
property portfolio comprising 38 noncore properties to black empowered Mergence
Africa Property Investment Trust (the "purchaser") with effect from 1 February
2008 (the "effective date") for a purchase consideration of R334 436 000 (plus
interest at a fixed rate of 11,5% per annum, nominal annual compounded monthly,
calculated from the effective date to the transfer date), to be settled in cash
on the transfer date.
The disposal is a related party transaction. Mazars Moores Rowland Corporate
Finance (Proprietary) Limited, in their capacity as an independent expert, have
confirmed in writing that the terms of the disposal are fair to ApexHi
unitholders. A copy of their fairness opinion is available for inspection until
23 April 2008 at the offices of ApexHi, being 3rd Floor, 2 Arnold Road,
Rosebank, Johannesburg.
RATIONALE
The disposal is in line with ApexHi`s strategy to dispose of its smaller
management intensive properties located in less accessible areas. The disposal
is yield enhancing and the proceeds of the disposal will be utilised to repay
interest bearing debt.
PRO FORMA FINANCIAL EFFECTS
The pro forma financial effects are provided for illustrative purposes and due
to their nature may not give a realistic picture of ApexHi`s financial results
and position after the disposal has been implemented. The pro forma financial
effects are the responsibility of the board of directors of ApexHi.
The table below sets out the unaudited pro forma financial effects of the
disposal on earnings per A unit, earnings per B unit and earnings per C unit
(collectively, "earnings per unit") and distribution per C unit, based on the
reviewed interim results of ApexHi for the six months ended 31 December 2007.
Before the Pro forma % Change
disposal after the
(cents) disposal
(cents)
Earnings per A unit 72.31 80.09 10.8%
Earnings per B unit 87.52 95.30 8.9%
Earnings per C unit 15.36 23.88 55.5%
Distribution per C unit 11.00 11.74 6.7%
Notes:
1 The "Before the disposal" column reflects earnings per unit and
distribution per C unit as published in the reviewed interim results of
ApexHi for the six months ended 31 December 2007;
2 The "Pro forma after the disposal" column reflects what the earnings per
unit and distribution per C unit for the six months ended 31 December 2007
would have been had the effective date of the disposal been 1 July 2007;
3 The pro forma financial effects have been prepared on the assumption that
60% of the proceeds have been received in cash and utilised to reduce net
debt at an average interest rate of 10.70%, with the balance remaining
owing by the purchaser on loan account bearing interest at 11.5% per annum.
In effect, ApexHi will receive 100% of the proceeds from the disposal.
However, ApexHi has advanced a loan, in terms of which it will receive
interest at the rate of 11.5% per annum, nominal annual compounded monthly,
in an amount equivalent to 40% of the purchase price, to Mergence Africa
Properties (Proprietary) Limited, the holder of 51% of the combined units
in Mergence Africa Property Fund, which in turn has advanced such funding
to the purchaser on loan account;
4 The pro forma financial effects of the disposal on ApexHi`s headline
earnings per unit, distribution per A unit and distribution per B unit for
the six months ended 31 December 2007, and net asset value per unit and net
tangible asset value per unit at 31 December 2007, are not material and
have accordingly not been disclosed.
Johannesburg
26 March 2008
Sponsor
Java Capital (Proprietary) Limited
Independent expert
Mazars Moores Rowland Corporate Finance (Proprietary) Limited
Date: 26/03/2008 16:45:00 Produced by the JSE SENS Department.
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