| Fri 19 Aug 2011, 8:00 | | RIN - Redefine Properties International Limited - Interim management statement |
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RIN
RIN
RIN - Redefine Properties International Limited - Interim management statement
Redefine Properties International Limited
(formerly Kalpafon Limited)
(Incorporated in the Republic of South Africa)
(Registration number 2010/009284/06)
JSE share code: RIN ISIN Code: ZAE000149282
("RIN")
Set out below is an announcement which was released by Redefine International
plc, the AIM-listed subsidiary of RIN, on the Regulatory News Service ("RNS") of
the London Stock Exchange today.
The announcement includes reference to the merger between Wichford P.L.C. and
Redefine International plc.
"Wichford P.L.C.
("Wichford" or the "Company")
Interim Management Statement
The Board of Wichford P.L.C., the property investment company, today issues the
following Interim Management Statement relating to the period 1 April 2011 to 18
August 2011.
Overview
The second half of the financial year has been focused on the merger with
Redefine International plc ("Redefine") and it is pleasing to have received
strong shareholder support with all resolutions receiving over 99% of the votes
cast in favour of the transaction at the Extraordinary General Meeting ("EGM")
held on the 4 August 2011. Further details are contained below.
The covenant strength of our predominantly government tenant base continues to
produce stable cashflows and trading performance has remained robust. The
implementation of the UK Government`s comprehensive spending review and
generally weak occupier demand in most regional centres has, however, placed
increased risk on lease renewals and re-lettings. Asset management activities in
the period focussed on protecting current and future occupancy.
Property Portfolio
Asset management initiatives
Lyon House and Equitable House, Harrow
The Company remains on track to submit a full planning application for a
residential mixed-use scheme of approximately 250,000 sq ft on the former HMRC
occupied site. Discussions with the London Borough of Harrow and Design for
London are progressing in line with expectations. Subject to further
consultations with local stakeholders, the Company anticipates submitting a
planning application in the coming months.
Ongoing discussions to secure a Registered Social Landlord for the affordable
housing element of the scheme are at an advanced stage. A development agreement
for approximately 70,000 sq ft of affordable accommodation is anticipated to be
concluded before submitting the planning application.
Sapphire House, Telford
The lease to Tatung (UK) Limited, with a remaining term of six years, has been
surrendered in return for a tenant`s surrender premium of GBP5.0 million and the
transfer of all rights against the outgoing sub-tenant (MoD) for dilapidations
liabilities.
Occupancy
Occupancy weakened to 93.3% (March 2011: 96.2%), largely as a result of the
lease surrender negotiated at Telford. In addition, the non-renewal of some
smaller office units and the anticipated vacancy of two floors at Coventry Road,
Birmingham contributed to the decrease in occupancy. The above occupancy rate
includes the vacant space at Equitable House and Lyon House, Harrow which is no
longer available to let as the site is being prepared for redevelopment.
Occupancy excluding Equitable House and Lyon House stands at 96.5% (March 2011:
98.8%).
Rent Reviews
The proportion of the portfolio subject to CPI / RPI indexation or fixed
increases remained broadly unchanged at 62.8%. Inflation in the UK remains well
above the Bank of England`s 2.0% target benefitting rent reviews subject to CPI
or RPI.
The following rent reviews were settled or are in the process of being agreed:
- Aberdeen - open market review agreed and completed at GBP510,000 p.a. up from
GBP478,250 p.a., reflecting an increase of 6.6%
- Bradford - RPI rent review with anticipated increase from GBP1,750,000 p.a. to
GBP2,009,656 p.a., representing a 14.8% uplift
There have been no acquisitions or disposals in the period since 31 March 2011.
Cash Position and Dividend
The interim dividend of 0.32 pence per share totaling GBP3.40 million was paid
on 29 June 2011 to all shareholders on the register on 3 June 2011.
As at the date of this announcement the Company has approximately GBP36.0
million of available cash.
Debt Facilities
VBG2 Facility
Following the maturity of the VBG 2 facility in April 2011, the borrowers have
agreed to a Standstill Agreement with the facility servicer and are currently
exploring opportunities for a consensual sales process. This is in line with the
previously communicated strategy to pursue opportunities for an orderly exit
from Continental Europe.
A potential sale would remove the existing negative net asset value position of
approximately GBP10.1 million (approximately 0.95p per share) without any
negative impact on cashflows as all rental income is currently utilised to meet
property expenses, interest and principal debt repayments.
The EUR52.8 million outstanding on this facility is secured against two German
properties in Cologne and Stuttgart.
Merger
The boards of Wichford and Redefine announced on 13 July 2011 that they had
reached agreement on the terms of a recommended all share offer to be made by
Wichford for the entire issued and to be issued ordinary share capital of
Redefine.
All of the resolutions in connection with the merger and proposed at the EGM
held on 4 August 2011 were passed without amendment by the required majority.
Full results of the EGM are available on the Company website www.wichford.com
On 18 August 2011 Redefine Properties International Limited ("RIN"), the company
listed on the Johannesburg Stock Exchange which owns 82% of the issued share
capital of Redefine, announced that at a general meeting of linked unitholders
held on that day, all the special and ordinary resolutions in connection with
the merger were passed unanimously. RIN will now notify Wichford of its
acceptance of the Offer. A copy of the announcement can be found on the Company
website www.wichford.com
The admission of the enlarged company to the main market of the London Stock
Exchange is expected to take place on 23 August 2011 subject to all necessary
regulatory and admission requirements being met.
The following ISIN, TIDIM and SEDOL references will be adopted:
ISIN: M00B4JZYL28
TIDIM: RDI
SEDOL: B4JZYL2
Redefine intends to cancel its admission to trading on AIM which is expected to
become effective on 8 September 2011. Following the cancellation of Redefine`s
AIM admission, the Company will change its name to Redefine International P.L.C.
Outlook
Occupier and investment demand for regional office assets is likely to remain
subdued with pressures on public sector budgets and individuals` disposable
incomes set to continue. The focus remains on protecting occupancy and rental
income and repositioning assets with better alternative uses, or disposing of
those assets with limited growth potential.
The merger with Redefine will enhance the Company`s ability to support this
strategy with a larger, well diversified asset base and the support and capital
commitment from its largest shareholder.
Philippe de Nicolay, Chairman of Wichford commented:
"I am pleased that shareholders have voted in support of the merger with
Redefine. Following a detailed strategic review, the Board believes the merger
will create an enlarged, income-focused property company with a diversified
property portfolio and an improved capital structure. The merger includes a
significant capital commitment from Redefine Properties International Limited
reflecting their support for the enlarged company."
For further details, please contact,
Wichford P.L.C.
Philippe de Nicolay 00 33 1 40 74 42 79
Wichford Property Management Ltd
Mike Watters 020 7811 0100
Stephen Oakenfull 020 7811 0100
Citigate Dewe Rogerson 020 7638 9571
Toby Mountford
Kate Lehane
Wichford P.L.C. (UK Listed: WICH) is a property investment company, with a
portfolio focused on investment property occupied primarily by Central and State
Government bodies. Over three quarters of the portfolio comprises public sector
rented properties in the UK with the remainder in Germany and the Netherlands."
19 August 2011
Sponsor to Redefine Properties International Limited
Java Capital
Date: 19/08/2011 08:00:01 Produced by the JSE SENS Department.
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