| Mon 16 Apr 2012, 7:19 | | HRP - Hermans & Roman Properties Limited - Intention to List |
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HRP - Hermans & Roman Properties Limited - Intention to List
(currently registered under the name Business Venture Investments No 1554
Proprietary Limited)
Hermans & Roman Properties Limited
(Incorporated in the Republic of South Africa)
(Registration number 2011/118136/07)
JSE code: HRP ISIN: ZAE000163747
NOT FOR PUBLICATION, DISTRIBUTION OR RELEASE, DIRECTLY OR INDIRECTLY, IN OR INTO
THE UNITED STATES OF AMERICA, CANADA, JAPAN OR AUSTRALIA
HERMANS & ROMAN PROPERTIES ANNOUNCES ITS INTENTION TO LIST ON THE JSE
Business Venture Investments No 1554 Proprietary Limited (which is in the
process of being renamed Hermans & Roman Properties Limited) ("HRP" or the
"Company") is pleased to announce its intention to list its linked units on the
securities exchange operated by the JSE Limited ("JSE") during the second
quarter of 2012. The Company is structured as a property loan stock company and
the linked units of the Company are intended to be listed in the "Real Estate
Holdings and Development" sector of the Main Board of the JSE.
HRP is a newly-established, internally-managed real estate company focused on
investing in and managing retail and office properties in South Africa and
selected other sub-Saharan African countries. On listing, the Company will own a
portfolio of five large, high-quality, well-established retail and office
properties (the "Portfolio"), as well as the property management business of
Hermans & Roman Property Solutions (Proprietary) Limited ("HRPS"), one of the
larger independent specialist real estate managers in South Africa. HRPS was
founded in 2002 by Leslie Hermans and Kevin Roman, the Company`s CEO and
Executive Director, respectively, who collectively have 46 years of experience
in asset management, property management and related property services in the
South African real estate market. HRPS today manages assets that the directors
estimate to be worth approximately R8.5 billion on behalf of 24 blue chip
clients.
Leslie Hermans, CEO of the Company, said:
"Over the last ten years we have built up HRPS into a substantial property
management business and have managed real estate portfolios that the directors
estimate to be worth in excess of R20 billion in aggregate. The proposed
listing is an exciting step forward. We have assembled a portfolio of high-
quality, regionally-prominent and scarce prime properties offering stable,
defensive cash flows and value creation potential. Our focus post-listing will
be to grow the portfolio and deliver superior shareholder returns."
The Portfolio comprises three primarily retail properties and two primarily
office properties and will be managed by HRP`s highly-experienced team of real
estate professionals who collectively have more than 140 years of experience in
the retail and office property sectors. Four of the five properties in the
Portfolio are located in South Africa (Johannesburg, Mossel Bay, Cape Town and
Durban), and the fifth property is located in Lusaka, Zambia.
The largest properties in the Portfolio are Bedford Centre and Bedford Square, a
state-of-the-art shopping centre located in Johannesburg, and Manda Hill,
located in Lusaka, which is one of the largest in sub-Saharan Africa (excluding
South Africa) and which recently underwent a redevelopment/ refurbishment and
expansion programme. The other properties comprise Langeberg Mall, a regionally-
prominent shopping centre in Mossel Bay, H&R Technology Park, one of the largest
mixed-use properties in the South Peninsula in Cape Town, and Liberty Towers,
one of the larger office properties in Durban`s CBD. The Portfolio has been
independently valued, as at 1 April 2012, at an aggregate market value of R3.6
billion.
Leslie Hermans added:
"One of the strengths of HRP is our exposure to the high growth economies of
South Africa and sub-Saharan Africa as well as the growing retail market and
higher-yielding office market. Our long-term vision is to build a focused real
estate company comprising a limited number of large, primarily retail properties
in growth markets in South Africa and selected other sub-Saharan African
countries."
The listing is intended to be implemented, together with a capital raising by
the Company, through a private placement to qualifying investors only and there
will not be an offer to the general public. The net proceeds of the offer will
be used to, inter alia, fund a portion of the purchase consideration for the
Portfolio, with the remainder of the purchase price being financed through debt
facilities. A pre-listing statement providing full details of the offering will
be published in due course.
Citi has been appointed as Sole Global Co-ordinator, Sole Bookrunner, Sole
Corporate Advisor and Lead Transaction Sponsor to the Company.
Cape Town
16 April 2012
ENQUIRIES:
Hermans & Roman Properties +27 21 928 4000
Leslie Hermans, CEO
Johan Mostert, CFO
Kevin Roman, Executive Director
Citi +27 11 944 1000
Sean Wegerhoff
College Hill +27 11 447 3030
Cara White
NOTES TO EDITORS
PROPERTY PORFOLIO
The Company is principally focused on the growing retail property market and the
higher-yielding office property market, which the Directors believe will offer
attractive future income and growth opportunities.
The Portfolio is focused on retail and office properties and has an aggregate
GLA of 251,277sqm, of which 54.6% comprises retail space, 39.8% office space and
5.6% industrial space.
The Portfolio had 476 tenants and an occupancy rate of 96.8% (excluding head
leases) as at 31 January 2012.
The properties in the Portfolio are predominantly leased (core-tenanted) by
South African national and multinational retailers, well-known corporates and
local and provincial government. At 31 January 2012, national tenants and local
and provincial government tenants accounted for 75.9% of total GLA.
KEY STRENGTHS
The Company benefits from a number of competitive advantages, the most important
of these being:
* High-quality, well-established, defensive portfolio of scarce prime properties
offering value creation potential.
* Diversified tenant base comprising mostly A-grade and B-grade tenants
providing stable cash flow.
* Highly-experienced real estate management team providing the Company with the
skills necessary to enhance the rental and capital growth of the Company and to
execute the Company`s investment strategy.
* Extensive market relationship network which provides access to deal flow and
new developments.
* Exposure to the high-growth economies of South Africa and sub-Saharan Africa.
* Exposure to growing retail market and higher-yielding office market.
STRATEGY
* Enhance rental and capital growth through pro-active asset and property
management.
* Optimise the cost base of the properties in the Portfolio.
* Pursue selective yield-enhancing acquisitions based on rigorous investment
criteria.
* Employ appropriate amounts of leverage to enhance returns.
* Maintain an attractive distribution policy.
LEADERSHIP AND MANAGEMENT
The co-founders of HRPS, Leslie Hermans and Kevin Roman, have been appointed as
Chief Executive Officer and Executive Director, respectively, of the Company.
Johan Mostert has been appointed as Chief Financial Officer.
In addition, the Company has an experienced board of five non-executive
Directors chaired by Tim Cumming (the previous chairman of Old Mutual
Properties), of which four directors, including the Chairman, are independent.
The Company`s senior management team, who collectively have more than 140 years
of experience in the retail and office property sector, comprises nine
individuals located in three offices across South Africa (as well as Lusaka
post-
listing), the majority of whom have been integral in growing HRPS over the past
decade and in assembling the Portfolio since late 2010.
The extensive market relationships of the highly-experienced management team
provide access to deal flow in the high-growth economies of South Africa and
selected other sub-Saharan African countries.
LEADERSHIP EXPERIENCE
Timothy Cumming
Mr Cumming, the independent, non-executive Chairman of HRP, has 29 years`
business and investment management experience. Starting out as a management
trainee at Anglo American Corporation, he subsequently joined Allan Gray Limited
as General Manager where he was also a property analyst. Thereafter he became
Executive Director of HSBC Securities (South Africa) working in Corporate
Finance and then becoming Head of Investment Research before joining Old Mutual
Asset Managers (OMAM) as CEO in 1998. He fulfilled various roles at Old Mutual,
including Chairman of Old Mutual Properties as well as number of other group
companies. He left Old Mutual early in 2011 to start his own consulting and
coaching business.
Leslie Hermans
Mr Hermans is a founding member, shareholder and executive director of HRPS. He
has more than 23 years` experience in the property sector and is a specialist in
the areas of property asset management, property management, turnaround of
under-
performing property assets, property investment and development facilitation to
enhance value. He conceived HRPS in 2001. He has over the past ten years,
alongside Kevin Roman at HRPS, managed property assets that the directors
estimate to be worth in excess of R20 billion in the retail, office and public
sectors for various listed property companies, certain of the largest South
African financial institutions, the largest pension fund in South Africa,
various public entities as well as for both domestic and international private
clients.
Johan Mostert
Mr Mostert joined KPMG in 2002 following the Andersen/KPMG merger. He commenced
his career in banking with Barclays in 2004 in the Barclays Africa Finance team
with specific focus on Africa-related taxation and accounting matters. In 2007,
he was appointed as the Chief Financial Officer of ABSA Bank`s Rest of Africa
operations with full responsibility for finance related matters in that
division.
In January 2010, he joined Eagle Capital and held various directorships,
including Financial Director of Industrial Credit Company Africa Holdings
Limited. He resigned from Eagle Capital in February 2012. He has more than 12
years` financial management experience.
Kevin Roman
Mr Roman is a founding member, shareholder and executive director of HRPS. He
has more than 23 years` experience in property management and related services,
and is a specialist in the development and implementation of strategic
objectives, property management, asset utilisation and development facilitation.
He is the Chairman of the Cape Town Partnership and a Board Member of SAPOA and
the current president for 2011/2012. He is the Chairman of the JSE-listed
company, SA Corporate Real Estate Fund and serves on the Investment Committee.
He has over the past ten years, alongside Leslie Hermans at HRPS, managed
property assets that the directors estimate to be worth in excess of R20 billion
in the retail, office and public sectors for various listed property companies,
certain of the larger South African financial institutions, the largest pension
fund in South Africa, various public entities as well as for both domestic and
international private clients.
NOTICE TO RECIPIENTS:
A pre-listing statement prepared pursuant to the Listings Requirements of the
JSE is intended to be published and, when published, will be delivered to
investors who qualify to participate in the contemplated offering pursuant to
Section 96(1)(a) of the Companies Act as the participation in the contemplated
offering will be by invitation only. Investors should not subscribe for any
securities referred to in this announcement except on the basis of information
contained in the final pre-listing statement.
This announcement is not directed to the general public to subscribe for linked
units. The announcement is issued in compliance with the Listings Requirements
of the JSE for the purpose of providing information to qualifying investors in
regard to the Company, its operations and the proposed listing. This
announcement does not constitute an offer to the public in accordance with the
provisions of section 96(1)(a) of the Companies Act and is directed to
categories of investors such as (i) persons whose ordinary business or part of
whose ordinary business, is to deal with securities, either as principles or
agents, (ii) the PIC, (iii) any person or entity regulated by the Reserve Bank
of South Africa, (iv) an authorised, (iv) an authorised financial services
provider, as defined in the Financial Advisory and Intermediary Services Act
(Act No 37 of 2002), (v) a financial institution, as defined in the Financial
Services Board Act (Act No 97 of 1990), (vi) a wholly owned subsidiary of a
person contemplated in the bullet points in this paragraph above, acting as
agent in the capacity of an authorised portfolio manager for a pension fund
registered in terms of the Pension Funds Act (No. 24 of 1956), or as manager of
a collective investment scheme registered in terms of the Collective Investment
Schemes Control Act (No. 45 of 2002), and (vii) if the total contemplated
acquisition cost of the linked units, for any single addressee acting as
principal, is equal to or greater than R1,000,000.
The linked units described in this announcement are only available to, and any
invitation, offer or agreement to subscribe, purchase or otherwise acquire such
securities will be engaged in only with the person listed from (i) to (vii)
above. Any person who does not fall into any of the above categories should not
act or rely on this announcement or any of its contents. Simply because a person
falls into any of the above categories and qualified to receive the pre-listing
statement, when published, does not mean that an offer will be made to such
person in terms of the pre-listing statement. The offer for subscription to be
contained in the pre-listing statement, when published, is by invitation only.
If an offer is inadvertently made to a selected investor and such offeree does
not fall within one of the categories referred to above for an Exempt Investor,
the selected investor shall not be entitled to accept the offer for subscription
and such person shall be deemed not to have received the pre-listing statement.
This announcement and the information contained herein are not for distribution
in or into the United States of America (including its territories and
possessions, any state of the United States of America and the District of
Columbia) (the "United States"), Australia, Canada or Japan. This announcement
does not constitute, or form part of, an offer to sell, or a solicitation of an
offer to purchase, any securities in the United States, Australia, Canada or
Japan or in any jurisdiction in which any offer or solicitation could be
unlawful. The securities of the Company have not been and will not be registered
under the U.S. Securities Act of 1933, as amended (the "Securities Act"), and
may not be offered or sold within the United States. Purchasers of the linked
units in the contemplated offering by way of a private placement may not offer,
sell, pledge or otherwise transfer the linked units in the United States, except
pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act. The Company does not intend to
register any part of the contemplated offering in the United States.
This document is an advertisement and not a prospectus for the purpose of
Directive 2003/71/EC (together with any applicable implementing measures in any
Member State, the "Prospectus Directive"). In any EEA Member State that has
implemented the Prospectus Directive (and amendments thereto, including
Directive 2010/73/EU, to the extent implemented in each EEA Member State), this
announcement is only addressed to and is only directed at qualified investors in
that EEA Member State within the meaning of the Prospectus Directive.
This announcement is only directed at (i) persons who are outside the United
Kingdom, (ii) investment professionals falling within Article 19(5) of the U.K.
Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the
"Order") or (iii) high net worth entities falling within Article 49(2)(a) - (d)
of the Order (the persons described in (i) through (iii) above together being
referred to as "Relevant Persons"). The securities are only available to, and
any invitation, offer or agreement to subscribe, purchase or otherwise acquire
such securities will be engaged in only with, Relevant Persons. Any person who
is not a Relevant Person should not act or rely on this announcement or any of
its contents.
The Sole Bookrunner and its affiliates are acting exclusively for the Company
and no-one else in connection with the contemplated offering by way of a private
placement. They will not regard any other person as their respective clients in
relation to the contemplated offering by way of a private placement and will not
be responsible to anyone other than the Company for providing the protections
afforded to their respective clients, nor for providing advice in relation to
the contemplated offering by way of a private placement, the contents of this
announcement or any transaction, arrangement or other matter referred to herein.
No representation or warranty, express or implied, is made by the Sole
Bookrunner as to the accuracy, completeness or verification of the information
set forth in this announcement, and nothing contained in this announcement is,
or shall be relied upon as, a promise or representation in this respect, whether
as to the past or the future. The Sole Bookrunner assumes no responsibility for
its accuracy, completeness or verification and, accordingly, disclaim, to the
fullest extent permitted by applicable law, any and all liability which they
might otherwise be found to have in respect of this announcement or any such
statement.
In connection with the contemplated offering by way of a private placement, the
Sole Bookrunner and any of its affiliates, acting as investors for their own
accounts, may subscribe for or purchase linked units and in that capacity may
retain, purchase, sell, offer to sell or otherwise deal for their own accounts
in such linked units and other securities of the Company or related investments
in connection with the contemplated offering by way of a private placement or
otherwise. Accordingly, references in any pre-listing statement, if published,
to the linked units being issued, offered, subscribed, acquired, placed or
otherwise dealt in should be read as including any issue or offer to, or
subscription, acquisition, placing or dealing by, such Sole Bookrunner and any
of its affiliates acting as investors for their own accounts. The Sole
Bookrunner does not intend to disclose the extent of any such investment or
transactions otherwise than in accordance with any legal or regulatory
obligations to do so.
Matters discussed in this release may constitute forward-looking statements.
Forward-looking statements are statements that are not historical facts and be
identified by words such as "believe", "expect", "anticipate", "intends",
"estimate", "will", "may", "continue", "should", and similar expressions. The
forward-looking statements in this press release are based upon various
assumptions, many of which are based, in turn, upon further assumptions.
Although the Company believes that these assumptions were reasonable when made,
these assumptions are inherently subject to significant known and unknown risks,
uncertainties, contingencies and other important factors which are difficult or
impossible to predict and are beyond its control. Such risks, uncertainties,
contingencies and other important factors could cause actual events to differ
materially from the expectations expressed or implied in this release by such
forward-looking statements.
The information, opinions and forward-looking statements contained in this
release speak only as at its date, and are subject to change without notice.
Date: 16/04/2012 07:19:35 Produced by the JSE SENS Department.
