| Tue 17 May 2011, 17:41 | | PNG - Pinnacle Point - Sale of Pinnacle Point Golf and Beach Resorts and |
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PNG
PNG
PNG - Pinnacle Point - Sale of Pinnacle Point Golf and Beach Resorts and
Renewal of Cautionary Announcement
PINNACLE POINT GROUP LIMITED
(Incorporated in the Republic of South Africa)
(Registration Number 2000/000059/06)
JSE Share code: PNG
NSE Share code: PNG
ISIN: ZAE000127122
("Pinnacle Point" or the "Company")
SALE OF PINNACLE POINT GOLF AND BEACH RESORTS AND RENEWAL OF CAUTIONARY
ANNOUNCEMENT
The Company is pleased to announce that in relation to the cautionary
announcements dated 24 December 2010, 04 February 2011, 18 March 2011 and 29
April 2011, the negotiations referred to therein have been finalised.
DISPOSAL OF PINNACLE POINT GOLF AND BEACH RESORTS
On 13 May 2011, the Board approved a re-instatement agreement of sale which
has been entered into with effect from 18 April 2011 whereby the Main
Agreement signed on 03 February 2011 has been re-instated with amended
conditions precedent and an extension of dates for proof of funds and
guarantees by 31 May 2011.
The agreement between Pinnacle Point Resorts (Proprietary) Limited ("PPR"), a
wholly-owned subsidiary of the Company, Festival Bay Trading 55 (Proprietary)
Limited ("Festival"), another wholly-owned subsidiary of the Company,
collectively referred to as "the Sellers", and Veritable Investments
(Proprietary) Limited ("Veritable") and Raptoguard (Proprietary) Limited
("Raptoguard"), collectively referred to as "the Purchasers" has been signed
with effect from 23 April 2011.
The agreement states that the Sellers will sell to the Purchasers the golf
course, the property upon which the clubhouse is situated, all unsold erven,
and certain vacant property upon which a gymnasium, spa, recreational
facilities and convention centre will be erected on and utilized as a hotel
operation of the Pinnacle Point Resort ("PP Resort").
The purchase consideration for the PP Resort as a going concern is R75 000 000
which is payable in cash.
The purchase amount is payable on registration of transfer of the properties
to be purchased which will also then be the effective date of the disposal.
The Purchasers are a German based consortium that wish to convert the PP
Resort into a 5-star resort.
The purchase consideration of R75 million will be used, inter alia, to settle
outstanding debt of approximately R58 million with Investec Bank Limited.
CONDITIONS PRECEDENT
The conditions precedent for the above mentioned agreement to be fulfilled are
as follows:
- Approval by the Veritable and Raptoguard shareholders of this purchase;
- Veritable and Raptoguard to furnish the Company with a bank guarantee for
the amount of R75 million by 31 May 2011 and the balance of the R400
million by 30 June 2011;
- PPR to obtain the sanction of the PPR Homeowner`s Association ("PPHOA")
by 21 May 2011 to approve the agreement and amend Article 35.13 of its
constitution authorising the hosting of up to 36 professional golf
tournaments at the golf course and clubhouse; and
- Approval by the Pinnacle shareholders of this transaction, if required.
OTHER TERMS
The Purchasers grant a first option to PPHOA to acquire the golf course and
clubhouse property in the event that the Purchaser does not construct and
complete the various facilities within the stipulated time period and/or in
the event that the Platinum Members benefits are not maintained as set out in
their agreement with the Company.
PRO FORMA FINANCIAL EFFECTS
Pro forma financial effects of the above mentioned disposal will be released
on SENS in a separate announcement in due course.
RENEWAL OF CAUTIONARY ANNOUNCEMENT
The company remains in negotiations in relation to other matters in addition
and separate to this disposal. Accordingly, shareholders are advised to
continue to exercise caution until the pro forma financial effects of this
disposal are announced as well as until a further announcement is made in
relation to other separate negotiations.
Johannesburg
17 May 2011
Designated Advisor
Arcay Moela Sponsors (Proprietary) Limited
Date: 17/05/2011 17:41:10 Produced by the JSE SENS Department.
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