| Mon 20 Jun 2011, 13:43 | | PPR - Putprop Limited - Acquisition of Detpak Kya Sands |
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PPR
PPR
PPR - Putprop Limited - Acquisition of Detpak Kya Sands
PUTPROP LIMITED
Incorporated in the Republic of South Africa
(Registration number 1988/001085/06)
Share code: PPR ISIN: ZAE000072310
("Putprop" or "the company")
ACQUISITION OF DETPAK KYA SANDS
1 INTRODUCTION AND RATIONALE
The board of directors of Putprop ("the Board") is pleased to inform
shareholders that Putprop has entered into an agreement of sale dated 20 June
2011 ("the Agreement") with Dorpao (Proprietary) Limited ("Dorpao" or "the
Seller") to acquire the eight properties known as Detpak Kya Sands, together
with all buildings and improvements thereon ("the Property"), as one indivisible
transaction, from Dorpao ("the Acquisition").
The acquisition of Detpak Kya Sands complies with the company`s stated objective
of strategic investments focussed on industrial and commercial opportunities,
where yields are enhancing in the medium and long term as well as broadening of
the current tenant base to reduce the risk of over dependence on a limited
number of tenants.
2 THE ACQUISITION
2.1 Details of the Property
Detpak Kya Sands, which comprises eight properties situated on Erf Numbers
384-7 and 393-6 Kya Sand Extension 42 Township, Registration Division I.Q.,
Province of Gauteng, together with all buildings and improvements thereon,
measures 5 785 square metres. The gross lettable area of 5 182 square
metres includes a factory/warehouse, offices and other structures of 4 231,
439 and 512 square metres respectively. The weighted average rental per
square metre is R30.68. The current tenant, whose six year lease expires in
December 2015, is a member of a global packaging group. For the period
ending 31 December 2012, rent escalates at a rate of 3% per year and
thereafter, at a rate of 6% per year.
2.2 Purchase consideration and effective date
The total purchase consideration of R13 800 000, which will be settled
entirely in internally generated cash, will be paid to the Seller as
follows:
- R2 000 000 will be paid by the company to the transferring attorneys
within five days of the signature date of the Agreement and will be
held in an interest bearing trust account for the benefit of Putprop,
pending registration of transfer of the Property in favour of the
company ("transfer"); and
- R11 800 000, to be secured by way of a bank guarantee issued in favour
of Dorpao and delivered to the transferring attorneys within 15 days
of signature date of the Agreement, will be paid on registration of
transfer.
All costs relating to the transfer of the Property in favour of Putprop
will be paid by the company. The estate agents` commission, amounting to
R414 000, will be paid by the Seller from the proceeds of the sale on
registration of transfer.
The effective date of the Acquisition will be the date of registration of
transfer
.
A valuation of the Property was performed prior to the Acquisition by
Putprop`s directors, who are not registered as professional valuers in
terms of the Property Valuers Profession Act, 2000 (No 47 of 2000). The
Property was valued at an amount of R15 000 000.
2.3 Conditions precedent
The Acquisition is not subject to any conditions precedent and the Property
has been sold "voetstoots".
3 PRO FORMA FINANCIAL EFFECTS OF THE ACQUISITION
The table below sets out the unaudited pro forma financial effects of the
Acquisition, on Putprop`s earnings per share, headline earnings per share, net
asset value per share and tangible net asset value per share.
The unaudited pro forma financial effects have been prepared to illustrate the
impact of the Acquisition on the reported financial information of Putprop for
the six months ended 31 December 2010, had the Acquisition occurred on 1 July
2010 for income statement purposes and on 31 December 2010 for balance sheet
purposes.
The unaudited pro forma financial effects have been prepared using accounting
policies that comply with International Financial Reporting Standards and that
are consistent with those applied in the interim results for the six months
ended 31 December 2010 and the audited results of Putprop for the year ended 30
June 2010.
The unaudited pro forma financial effects, which are the responsibility of the
directors, are provided for illustrative purposes only and, because of their pro
forma nature may not fairly present Putprop`s financial position, changes in
equity, results of operations or cash flow.
Before the After the Percentage
Acquisition Acquisitio change (%)
n
Basic earnings per share (cents) 48.4 49.2 1.7
Headline earnings per share (cents) 38.7 39.5 2.1
Net asset value per share (cents) 848.5 848.4 -
Tangible net asset value per share 848.5 848.4 -
(cents)
Weighted average number of shares in 28 792 961 28 792 961 -
issue
Notes:
1 The amounts in the "Before the Acquisition" column have been extracted from
the unaudited financial results of Putprop for the six months ended 31
December 2010.
2 The amounts in the "After the Acquisition" column reflect the financial
effects of the Acquisition on Putprop.
3 The effects on earnings per share and headline earnings per share are
calculated based on the assumption that the Acquisition was effected on 1
July 2010.
4 The effects on net asset value per share and tangible net asset value per
share are calculated based on the assumption that the Acquisition was
effected on 31 December 2010.
4 CLASSIFICATION OF THE ACQUISITION
The Acquisition is classified as a Category 2 transaction in terms of the
Listings Requirements of the JSE Limited.
20 June 2011
Sponsor
Merchantec Capital
Date: 20/06/2011 13:43:01 Produced by the JSE SENS Department.
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