| Thu 31 Mar 2011, 16:44 | | VIF - Vividend Income Fund Limited - Acquisition of new properties |
|
VIF
VIF
VIF - Vividend Income Fund Limited - Acquisition of new properties
Vividend Income Fund Limited
Previously known as Business Venture Investments No 1381 (Proprietary) Limited
Incorporated in the Republic of South Africa
(Registration Number 2010/003232/06)
JSE Alpha Code: VIF
ISIN: ZAE000150918
("Vividend" or "the Company")
ACQUISITION OF NEW PROPERTIES
THE CHURCH STREET (PIETERMARITZBURG) PROPERTY
1. THE CHURCH STREET (PIETERMARITZBURG) ACQUISITION
Linked unitholders of the Company are hereby advised that the Company has
entered into an agreement with R & A Admin CC to acquire the property and
letting enterprise, commonly known as "Edgars Church Street" ("the Church
Street (Pietermaritzburg) Property"), located on portions 3 and 4 of Erf
2421 and portions 4, 5 and 6 of Erf 2422 Pietermaritzburg, KwaZulu-Natal
("The Church Street (Pietermaritzburg) Acquisition")
The effective date of the Church Street (Pietermaritzburg) Acquisition
shall be the date of transfer of the Church Street (Pietermaritzburg)
Property into the name of the Company, which, subject to fulfilment of the
condition precedent, is expected on 1 May 2011.
2. RATIONALE FOR THE ACQUISITION
The Church Street (Pietermaritzburg) Acquisition is consistent with
Vividend`s strategy of identifying and acquiring properties that have free
cash flow yields that provide adequate value enhancement to linked
unitholders from the effective date of their acquisition. The Church Street
(Pietermaritzburg) Acquisition is consistent with the timelines, objectives
and projections of Vividend for the 2011 financial period.
3. PURCHASE CONSIDERATION
The purchase consideration for the Church Street (Pietermaritzburg)
Acquisition is R38 400 000 (thirty eight million four hundred thousand
rand), payable in cash against transfer of the Church Street
(Pietermaritzburg) Property into the name of the Company.
4. PRO FORMA FINANCIAL EFFECTS OF THE CHURCH STREET (PIETERMARITZBURG)
ACQUISITION
The pro forma financial effects of the Church Street (Pietermaritzburg)
Acquisition on net asset value and net tangible asset value per linked unit
are not significant and therefore have not been disclosed.
5. FORECAST INFORMATION ON THE CHURCH STREET (PIETERMARITZBURG) ACQUISITION
The forecast financial information relating to the Church Street
(Pietermaritzburg) Acquisition for the financial periods ended 31 August
2011 and 31 August 2012 is set out below. The forecast financial
information has not been reviewed or reported on by a reporting accountant
in terms of section 8 of the Listings Requirements of the JSE Limited and
is the responsibility of the Company`s directors.
Forecast for the 4 Forecast for the 12
months ending 31 months ending 31
August 2011 August 2012
Gross Income R1,349,395 R4,142,643
Property - -
Expenditure
Net Property Income R1,349,395 R4,142,643
Property Income - -
after interest and
taxation
Annualised Yield on 10.54% 10.79%
Property
Notes:
1. The forecast information for the 4 months ending 31 August
2011 has been calculated from the anticipated effective date
of the Church Street (Pietermaritzburg) Acquisition, being 1
May 2011.
2. Contractual income constitutes 100% of Gross Income for
both the 4 month period ending 31 August 2011 and for the 12
month period ending 31 August 2012.
3. Un-contracted income constitutes 0% of the Gross Income for
both the 4 month period ending 31 August 2011 and for the 12
month period ending 31 August 2012.
4. 100% of Net Property Income is distributed to linked unit
holders as interest in accordance with the Debenture Trust
Deed of the Company.
6. PROPERTY SPECIFIC INFORMATION
Details regarding the Church Street (Pietermaritzburg) Acquisition are set
out below:
Property name Church Street
(Pietermaritzburg)
Location 219 Church Street,
Pietermaritzburg
GLA 5,125 m2
Single or multi-tenanted Single tenanted retail centre
A Tenant percentage by GLA 100%
A Tenant percentage by Gross 100%
Income
Weighted average gross rental R65.82
per m2
Vacancy by GLA Nil
Annualised property yield 10.54%
Purchase price R38,400,000
Value R38,400,000
Notes:
1. The weighted average escalation percentage, calculated by
GLA, within the Church Street (Pietermaritzburg) Property
lease profile is the lower of a) CPIX, being the Consumer
Price Index based on a weighted average of 12 (twelve) months,
as published by Statistics SA, plus 3% b) 7%, provided that
the annual escalation shall not be less than 5%.
2. Turnover rental, if applicable to a particular year, is
payable by the tenant at a rate of 3.5% of net turnover
3. The weighted average lease period, calculated by GLA,
within the Church Street (Pietermaritzburg) Property lease
profile is 5 years.
4. The A Tenant within the Church Street (Pietermaritzburg)
Property lease profile is Edgars.
5. The value of the Church Street (Pietermaritzburg) Property
of R38 400 000 was arrived at by a directors` valuation as at
10 March 2011. The directors of the Company are not
independent and are not registered as professional valuers or
as professional associate valuers in terms of the Property
Valuers Profession Act, No 47 of 2000.
6. Save for costs associated with the transfer of the Church
Street (Pietermaritzburg) Property, which amount to R65 000,
no expenditure will be incurred by the Company in connection
with the Church Street (Pietermaritzburg) Acquisition.
7. CONDITION PRECEDENT
The Church Street (Pietermaritzburg) Acquisition is subject the following
condition precedent:
a) The shareholders of R & A Admin CC passing the required resolution in
terms of section 228 of the Companies Act 61 of 1973, by 17 April
2011, or the equivalent in terms of the Companies Act 71 of 2008, if
applicable.
8. CATEGORISATION
The Church Street (Pietermaritzburg) Acquisition is a Category 2
acquisition in terms of the Listings Requirements of the JSE Limited.
THE BEAUFORT WEST PROPERTY
1. THE BEAUFORT WEST SHOPPING CENTRE ACQUISITION
Linked unitholders of the Company are hereby advised that the Company has
entered into an agreement with Beaufort West Shopping Centre (Proprietary)
Limited to acquire the property and letting enterprise, commonly known as
the Beaufort West Shopping Centre ("the Beaufort West Property"), situated
on Erf 7401 Beaufort West in the Province of Western Cape ("the Beaufort
West Acquisition").
The effective date of the Beaufort West Acquisition shall be the date of
transfer of the Beaufort West Property into the name of the Company, which,
subject to fulfilment of the conditions precedent, is expected on 1 May
2011.
2. RATIONALE FOR THE ACQUISITION
The Beaufort West Acquisition is consistent with Vividend`s strategy of
identifying and acquiring properties that have free cash flow yields that
provide adequate value enhancement to linked unitholders from the effective
date of their acquisition. The Beaufort West Acquisition is consistent with
the timelines, objectives and projections of Vividend for the 2011
financial period.
3. PURCHASE CONSIDERATION
The purchase consideration for the Beaufort West Acquisition is R40 216 000
(forty million two hundred and sixteen thousand rand). R38 512 000 (thirty
eight million five hundred and twelve thousand rand) is payable in cash
against transfer of the Beaufort West Property into the name of the Company
while the balance, being R1 704 000 (one million seven hundred and four
thousand rand), is payable, subject to the result of the guarantees
referred to under `Warranties` below, 36 (thirty six) months after the
transfer date.
4. PRO FORMA FINANCIAL EFFECTS OF THE BEAUFORT WEST ACQUISITION
The pro forma financial effects of the Beaufort West Acquisition on net
asset value and net tangible asset value per linked unit are not
significant and therefore have not been disclosed.
5. FORECAST INFORMATION ON THE BEAUFORT WEST ACQUSITION
The forecast financial information relating to the Beaufort West
Acquisition for the financial periods ended 31 August 2011 and 31 August
2012 is set out below. The forecast financial information has not been
reviewed or reported on by a reporting accountant in terms of section 8 of
the Listings Requirements of the JSE Limited and is the responsibility of
the Company`s directors.
Forecast for the 4 Forecast for the 12
months ending 31 months ending 31
August 2011 August 2012
Gross Income R1,824,241 R5,618,662
Property R349,637 R1,104,855
Expenditure
Net Property Income R1,474,604 R4,513,807
Property Income - -
after interest and
taxation
Annualised Yield on 11.00% 11.22%
Property
Notes:
1. The forecast information for the 4 months ending 31 August
2011 has been calculated from the anticipated effective date
of the Beaufort West Acquisition, being 1 May 2011.
2. Contractual income constitutes 100% of Gross Income for
both the 4 month period ending 31 August 2011 and for the 12
month period ending 31 August 2012.
3. Un-contracted income constitutes 0% of the Gross Income for
both the 4 month period ending 31 August 2011 and for the 12
month period ending 31 August 2012.
4. 100% of Net Property Income is distributed to linked unit
holders as interest in accordance with the Debenture Trust
Deed of the Company.
6. PROPERTY SPECIFIC INFORMATION
Details regarding the Beaufort West Acquisition are set out below:
Property name The Beaufort West Property
Location Erf 7401 Beaufort West,
Western Cape
GLA 6,911 m2
Single or multi-tenanted Multi-tenanted retail centre
A Tenant percentage by GLA 83.90%
A Tenant percentage by Gross 79.78%
Rentals
Weighted average gross rental R63.00
per m2
Vacancy by GLA 7.86% or 543 m2
Annualised property yield 11.00%
Purchase price R40,216,000
Value R40,216,000
Notes:
1. The weighted average escalation percentage, calculated by
GLA, within the Beaufort West Property lease profile is 6.9%.
2. The weighted average lease period, calculated by GLA,
within the Beaufort West Property lease profile is 3.97 years.
3. The A Tenants with the Beaufort West Property lease profile
include the likes of Pick `n Pay, Truworths, Mr Price,
Foschini and PEP.
4. The value of the Beaufort West Property of R40 216 000 was
arrived at by a directors` valuation as at 10 March 2011. The
directors of the Company are not independent and are not
registered as professional valuers or as professional
associate valuers in terms of the Property Valuers Profession
Act, No 47 of 2000.
5. Save for costs associated with the transfer of the Beaufort
West Property, which amount to R70,000, no expenditure will be
incurred by the Company in connection with the Beaufort West
Acquisition.
7. CONDITIONS PRECEDENT
The Beaufort West Acquisition is subject the following conditions
precedent:
a) The satisfactory completion of a due diligence investigation performed
by the Company on the Beaufort West Property and letting enterprise,
by 25 April 2011; and
b) The shareholders of Beaufort West Shopping Centre (Proprietary)
Limited passing the required resolution in terms of section 228 of the
Companies Act 61 of 1973 or the equivalent in terms of the Companies
Act 71 of 2008, if applicable.
The Company is entitled to waive the condition precedent set out in
paragraph a) above.
8. WARRANTIES
Beaufort West Shopping Centre (Proprietary) Limited has provided the
Company with warranties and indemnities which are usual for a transaction
of this nature, the most important of which are:
a) A 12 (twelve) month Net Property Income guarantee, effective from the
first day of the month succeeding the month in which the transfer of
the Beaufort West Property is made into the name of the Company;
b) A Gross Income guarantee on any space that is vacant or that becomes
vacant during the 12 (twelve) month period commencing on the first day
of the 13th month succeeding the month in which the transfer of the
Beaufort West Property is made into the name of the Company; and
c) A Gross Income guarantee on any space that is vacant or that becomes
vacant during the 12 (twelve) month period commencing on the first day
of the 25th month succeeding the month in which the transfer of the
Beaufort West Property is made into the name of the Company.
9. CATEGORISATION
The Beaufort West Acquisition is a Category 2 acquisition in terms of the
Listings Requirements of the JSE Limited.
Cape Town
31 March 2011
Sponsor
PSG Capital (Pty) Limited
Date: 31/03/2011 16:44:01 Produced by the JSE SENS Department.
The SENS service is an information dissemination service administered by the
JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or
implicitly, represent, warrant or in any way guarantee the truth, accuracy or
completeness of the information published on SENS. The JSE, their officers,
employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature,
howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
