| Mon 23 Apr 2012, 7:11 | | HRP - Hermans & Roman Properties Limited - Abridged Pre-listing Statement |
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JSE
HERM
HRP - Hermans & Roman Properties Limited - Abridged Pre-listing Statement
Hermans & Roman Properties Limited
(currently registered under the name Business Venture Investments No 1554
Proprietary Limited)
(Incorporated in the Republic of South Africa on 20 September 2011)
(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NOT FOR PUBLICATION, DISTRIBUTION OR RELEASE, DIRECTLY OR INDIRECTLY, IN OR INTO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
ABRIDGED PRE-LISTING STATEMENT
Abridged pre-listing statement relating to the listing of Business Venture
Investments No 1554 Proprietary Limited (to be renamed Hermans & Roman
Properties Limited) ("HRP" or the "Company") on the securities exchange operated
by the JSE Limited (the "JSE") with effect from the commencement of business on
Friday, 11 May 2012. The information in this abridged pre-listing statement has
been extracted from the detailed pre-listing statement issued by the Company
today, Monday, 23 April 2012, (the "Pre-listing Statement").
This abridged pre-listing statement is not an invitation to the public to
subscribe for linked units in the Company, but is issued in compliance with the
Listings Requirements of the JSE for the purposes of providing information to
the public with regards to the Company.
INTRODUCTION
Subject to the fulfilment of the offering conditions and the listing condition
set out below, the JSE has granted the Company a listing of its linked units in
the "Real Estate Holdings and Development" sector of the Main Board of the JSE
under the JSE code "HRP", abbreviated name "H&R Props" and ISIN "ZAE000163747"
(the "Listing").
The Listing is expected to be implemented, together with a capital raising by
the Company, through a private placement offered to qualifying investors only
(the "Offering") and there will not be an offer to the general public. The Pre-
listing Statement providing full details of the Offering has been published
today.
HRP will offer approximately 203,959,395 linked units at an issue price of
R10.00 per linked unit (the "Subscription Price") in order to raise gross
proceeds of approximately R2.039 billion, representing the largest ever real
estate initial public offering ("IPO") on the JSE.
The Company has received a binding commitment from the PIC in the amount of
R262.4 million to subscribe for and purchase, at the Subscription Price, 12.5
per cent. of the total issued Linked Units as at the Listing date.
Applications must be for a minimum of R1,000,000 per investor acting as
principal.
The Company will use the net proceeds of the Offering to, inter alia, discharge
a portion of the purchase consideration for the Portfolio. The remainder of the
purchase price for the Portfolio will be financed by bank debt, resulting in a
loan-to-value ratio of approximately 49.4 per cent. Going forward, the
directors of the Company (the "Directors") intend to employ leverage through
debt financing to enhance unitholder returns with a target overall level of
portfolio gearing of approximately 40 per cent. to 45 per cent. loan-to-value.
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.
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 sector. 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 Portfolio has an aggregate GLA of 251,277 sqm, of which 54.6 per cent.
comprises retail space, 39.8 per cent. office space and the remaining 5.6 per
cent. industrial space. The Portfolio had 477 tenants and an aggregate occupancy
rate of 96.8 per cent. as at 31 January 2012, excluding head leases. The
directors of the Company believe that the Portfolio will generate a forward
distribution yield of approximately 8.7 per cent. for the year ending 31 July
2013. The Portfolio has been independently valued by Mills Fitchet Magnus Penny,
as at 1 April 2012, at an aggregate market value of R3.636 billion.
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.
The asset and property management business of HRPS (the "Management Business")
has been acquired for an initial payment in linked units of R45 million payable
two days prior to Listing and three further payments in linked units of R25
million each payable on each of 1 August 2013, 2014 and 2015. The value of the
Management Business will be determined by the auditors at the end of the fourth
full financial year of the Company post-Listing by capitalising the average
Management Business net operating income at a yield of 12.5 per cent. and,
depending on the result of the valuation, the Company may be required to make an
additional payment of up to R95 million, which will be settled in linked units.
The Management Business has been independently valued by BDO Corporate Finance
(Proprietary) Limited at a range of R187.5 million to R215.5 million as at the
Listing date.
As a property loan stock company with a capital structure comprising ordinary
shares indivisibly linked to debentures, the Company will distribute semi-
annually at least 99 per cent. of its net income through debenture interest.
The Directors believe that the defensive nature of the Portfolio will result in
relatively greater stability in income growth and in distribution growth.
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 three executive
directors are Leslie Hermans, CEO, Johan Mostert, CFO, and Kevin Roman,
Executive Director.
Citi has been appointed as Sole Global Co-ordinator, Sole Bookrunner, Sole
Corporate Advisor and Lead Transaction Sponsor to the Company.
VISION
The Directors` 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 with a
portfolio value similar in size to the larger JSE-listed real estate companies,
thereby establishing the Company as a leading sub-Saharan African listed retail
and office real estate company. Accordingly, the Directors intend to pursue
further acquisitions of regionally-prominent, prime retail and office properties
at attractive yields based on rigorous investment criteria.
MANAGEMENT TEAM
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
-Listing), the majority of whom have been integral in growing HRPS over the
past decade and in assembling the Portfolio since late 2010. The Directors
believe that the specialist expertise, successful track record and extensive
market relationships of the management team provide the Company with the
skills, necessary to enhance the rental and capital growth of the Portfolio
through pro-active asset and property management, as well as through the
implementation of master development plans (where the Directors deem
appropriate) targeting rental increases, cost base optimisation and other
value-enhancing initiatives. Furthermore, the highly-experienced management
team is well-positioned to execute the Company`s investment strategy by
evaluating and competing successfully for the most attractive opportunities
and contracts in the real estate market.
THE PORTFOLIO
The Portfolio comprises five high-quality primarily retail and office properties
and has been independently valued by Mills Fitchet Magnus Penny, as at 1 April
2012, at a market value of R3.604 billion. The Portfolio has been acquired for
R3.636 billion by the Company.
Property Main use Tenants(1) GLA (sqm) % of GLA Occupancy(1)
South Africa:
Bedford Retail/office(2) 223 86,538 34.4% 95.2%
Langeberg
Mall Retail/office(3) 98 30,047 12.0% 95.5%
HRTP Office/industrial(4) 9 51,792 20.6% 96.0%
Liberty
Towers Office(5) 45 40,860 16.3% 99.2%
Total South Africa 375 209,237 83.3% 96.2%
Zambia:
Manda Hill Retail(6) 102 42,040 16.7% 99.9%
Total 477 251,277 100.0% 96.8%
Note 1 - as at 31 January 2012; occupancy excludes vendor head leases.
Note 2 - 22,541 sqm of GLA at Bedford constitutes office use.
Note 3 - 355 sqm of GLA at Langeberg constitutes office use.
Note 4 - 14,034 sqm of GLA at HRTP constitutes industrial use.
Note 5 - 2,303 sqm of GLA at Liberty Towers constitutes retail use.
Note 6 - 707 sqm of GLA at Manda Hill constitutes office use.
Bedford, located in Johannesburg, is the largest property in the Portfolio,
combining a recently refurbished modern shopping centre that meets international
standards and is focused on upper income residents, with prime office space.
Langeberg Mall, a regionally-prominent shopping centre, is the largest and one
of the most prestigious in Mossel Bay (with a catchment area extending up to 200
km) and is focused on middle-income residents and tourists.
H&R Technology Park is one of the largest mixed-use properties with a light
commercial and light industrial profile in the South Peninsula in Cape Town.
Liberty Towers is an iconic building comprising two towers and is one of the
larger office properties in Durban`s CBD and has ample on-site parking.
Manda Hill is the first regional shopping centre in Zambia and one of the
largest in sub-Saharan Africa (excluding South Africa) and recently underwent a
redevelopment/refurbishment and expansion programme. Manda Hill is aimed at
medium to upper income residents and tourists.
Four of the five properties in the Portfolio are located in major South African
nodes (Johannesburg, Mossel Bay, Cape Town and Durban), and the fifth property
is located in Lusaka, Zambia. The South African properties account for 73.5 per
cent. of the appraised Portfolio value, 83.3 per cent. of total GLA and are
expected to contribute 73.7 per cent. of FY1 Projected Base Rent (FY1 Project
Base Rent is the minimum rent contractually agreed under each lease agreement,
to be received by the Company, for the period from 1 August 2012 to 31 July 2013
and takes no account of any tenant incentives and does not include any turnover
rent, sundry income (such as parking or similar) and income associated with
costs and expenses paid by the Company, and subsequently recovered from the
tenant).
The Portfolio is focused on retail and office properties, with 54.6 per cent. of
the GLA comprising retail space, 39.8 per cent. office space and 5.6 per cent.
industrial space. Retail space is expected to contribute approximately 69.4 per
cent. of FY1 Projected Base Rent, while office space is expected to contribute
28.4 per cent. and industrial space is expected to contribute 2.2 per cent.
The Directors believe that the Portfolio has traditionally maintained low
vacancy levels and, at 31 January 2012, had an aggregate occupancy of 96.8 per
cent. The vacancy levels at Bedford and Langeberg Mall are covered by a vendor
head lease in respect of vacant space that expires 12 months from 1 August 2012.
The vacancy at H&R Technology Park is covered by a vendor head lease in respect
of vacant space that expires two years following its acquisition. No vendor head
lease or rental guarantee exists for Manda Hill or Liberty Towers.
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 tenants. At 31 January 2012, national tenants
and local and provincial government tenants accounted for 75.9 per cent. of
total GLA and are expected to contribute approximately 65.6 per cent. of FY1
Projected Base Rent. The Portfolio`s top ten tenants, which are either of South
African origin or local and provincial government tenants, are expected to
account for 49.3 per cent. and 37.9 per cent. of total GLA and FY1 Projected
Base Rent, respectively. The weighted average lease term of the lease agreements
in the Portfolio based on GLA and FY1 Projected Base Rent are expected to be 5.3
years and 4.7 years, respectively. The Directors expect average rental
escalation by GLA for the Portfolio to be 6.6 per cent. for the year ending 31
July 2013.
The vendors of Manda Hill entered into an Investment Promotion and Partnership
Agreement ("IPPA") with the Zambia Development Agency ("ZDA"), pursuant to which
MHCL was entitled to all fiscal incentives afforded to investors under the
Zambian Development Agency Act, No. 11 of 2006 (the "ZDA Act"). The ZDA and the
Zambian Revenue Authority (the "ZRA") have advised MHCL that it is not required
to pay income tax on its normal trading income in Zambia through to 31 December
2015. Thereafter, MHCL will be taxed at a rate of 17.5 per cent. between 1
January 2016 and 31 December 2017 and at a rate of 26.25 per cent. between 1
January 2018 and 31 December 2019. Thereafter, MHCL and the ZDA agreed that MHCL
would pay income tax at the applicable corporate rate, which is currently 35.0
per cent. The income tax rate schedule as described above is referred to herein
as the "Zambian Income Tax Holiday". Pending the completion of certain
administrative steps, including the inclusion of "property development" or like
business activities as a "priority sector" under the ZDA Act and/or receiving
the necessary confirmations that the Zambian Income Tax Holiday envisaged was
granted pursuant to the development of Manda Hill falling within the "tourism
priority sector", the Company has prepared the forecast statement of
comprehensive income on the basis that the Zambian Income Tax Holiday is not in
place. While the Directors believe that the Zambian Income Tax Holiday is
enforceable, and will use their best endeavours to complete the pending
administrative steps as soon as practically possible, there can be no assurances
that the Company will be able to complete the pending administrative steps
and/or that the ZRA will agree to continue to apply the Zambian Income Tax
Holiday. While there can be no assurances that the Directors will be able to
complete the pending administrative steps, should they be able to do so, the
Directors believe that the Portfolio will generate a forward distribution yield
for the year ending 31 July 2013 of approximately 8.9 per cent.
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; and
* exposure to growing retail market and higher-yielding office market.
STRATEGY
The Company has a clearly defined strategy aimed at delivering sustainable total
returns through earnings growth and capital appreciation in order to create
value for Unitholders. This strategy is underpinned by a long-term vision 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 with a portfolio value similar in size to the
larger JSE-listed real estate companies, thereby establishing the Company as a
leading sub-Saharan African listed retail and office real estate company. The
key elements of the Company`s strategy are to:
* 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; and
* maintain an attractive distribution policy.
THE FACILITIES
In order to discharge a portion of the purchase consideration for the Portfolio
and to optimise the Company`s returns and its distribution yield:
* the Company has entered into a term loan facility with Nedbank Limited in
the amount of R1.31 billion for a period of five years (the "ZAR
Facility"); and
* Manda Hill (Ireland) Limited has entered into a term loan facility with
N.B.S.A. Limited ("NBSA"), a wholly-owned subsidiary of Nedbank Group
Limited in the amount of US$59.0 million for a period of five years (the
"USD Facility" and, together with the ZAR Facility, the "Facilities").
Included in the ZAR Facility and the USD Facility are revolving credit
facilities of up to R400.0 million from Nedbank Limited and up to US$10.0
million from NBSA, respectively (the "Revolvers") and an overdraft facility with
Nedbank Limited of up to R50.0 million (the "Overdraft Facility").
PROSPECTS
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.
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 Directors believe that the relatively limited number of properties in the
Portfolio will enable them to create value for Unitholders through pro-active
asset and property management and by optimising the cost base of the properties
in the Portfolio.
Accordingly, the Directors believe that the Company has strong prospects and
that it will deliver attractive and sustainable total returns through earnings
growth and capital appreciation, thereby creating value for Unitholders.
INDICATIVE TIMETABLE
The indicative timetable below lists certain important dates and times relating
to the Offering, some of which are subject to change. Unless otherwise
indicated, all time references are to South African Standard Time:
2012
Opening date of the Offering 09:00 on Monday, 23 April
Publication of the Pre-listing Statement Monday, 23 April
Abridged Pre-listing Statement published in the press Tuesday, 24 April
Closing date of the Offering 17:00 on Wednesday, 2 May
Allocation announcement on SENS (Allocation Date) Thursday, 3 May
Allocation announcement in the press Friday, 4 May
Expected Payment Date by successful applicants 17:00 on Tuesday, 8 May
Expected Transfer Date of the properties in the Portfolio Wednesday, 9 May
Delivery by the Company to the JSE of written confirmation of successful
transfer of each of the properties in the Portfolio Wednesday, 9 May 2012
Expected Listing Date and Linked Units Issue Date Friday, 11 May 2012
Any material changes in the indicative timetable will be released on SENS.
BOARD OF DIRECTORS
Name, age and business address
Timothy Cumming (54) (Chairman)
37 Oak Avenue, Kenilworth, 7745, South Africa
Leslie Hermans (47) (Chief Executive Officer)
Hermans & Roman House, Tygerberg Park, 163 Hendrik Verwoerd Drive, Plattekloof,
7500, South Africa
Johan Mostert (35) (Chief Financial Officer)
Hermans & Roman House, Tygerberg Park, 163 Hendrik Verwoerd Drive, Plattekloof,
7500, South Africa
Kevin Roman (56) (Executive Officer)
Hermans & Roman House, Tygerberg Park, 163 Hendrik Verwoerd Drive, Plattekloof,
7500, South Africa
Shane Dold (42) (Non-independent non-executive director)
North Riding, 31 Upper Paradise Road, 7700, Newlands, South Africa
Zaida Adams (33) (Independent non-executive director)
35 Johnson Road, Rylands, 7764, South Africa
Adv. Norman Arendse (54) (Independent non-executive director) 10 Venken Lane,
Cape Town, 8000, South Africa
Prof Francois Viruly (51) (Independent non-executive director)
Viruly Consulting (Proprietary) Limited, c/o Department of Construction
Economics and Management, 5th Level, Centlivres Building, University Avenue,
Upper Campus, University of Cape Town, Rondebosch, 7701, South Africa
All of the Directors are South African citizens, other than Prof Francois Viruly
who is a Dutch citizen.
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, for 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 where he 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, for the largest
pension fund in South Africa, for various public entities as well as for both
domestic and international private clients.
SHARE CAPITAL
At the Listing date, the authorised share capital of the Company will consist of
2.5 billion no par value ordinary shares that are linked to unsecured variable
rate subordinated debentures as linked units. The issued linked unit capital
will comprise 209,959,395 Linked Units on such date. Each linked unit will
comprise one ordinary no par value share of R1.50 linked to one unsecured
variable rate debenture of R8.50 with a combined face value of R10.00, which
must be traded as an indivisible unit. There will be no other class of shares
authorised or in issue in the capital of the Company at the date of Listing.
OFFERING AND LISTING CONDITIONS
The Offering is conditional upon the fulfilment of the following conditions
(collectively, the "Offering Conditions"): (a) that all such special resolutions
of the shareholders of the Company required to: (i) convert the Company from a
private company to a public company; (ii) increase the authorised share capital
of the Company for purposes of the Offering and (iii) to adopt the memorandum of
incorporation, be filed with the CIPC (all resolutions have been delivered to
the office of the CIPC); (b) that all regulatory approvals relating to the
Acquisitions be obtained; (c) that the Company attain a spread of Unitholders
acceptable to the JSE as set forth in the JSE Listings Requirements, which
provide that a listed company must have at least 300 public Unitholders and that
such public unitholders must hold at least 20 per cent. of the linked units (as
defined in the JSE Listings Requirements) (the "JSE Spread"); (d) that the
underwriting agreement be signed following allocation and becomes unconditional
in accordance with its terms on the payment date; (e) that the transfer of each
of the properties in the Portfolio and the Management Business be completed on
the transfer date be completed; and (f) that the transfer of the proceeds of the
Offering to the vendors be effected.
If all of the Offering Conditions are not satisfied by 15 May 2012 (the "Back-
stop Date"), then the Offering and any acceptance of invitations addressed to
investors pursuant thereto shall not take effect and the Sole Bookrunner, on
behalf of the Company, will return any funds received from investors without
interest (the "Refund"). Notwithstanding the foregoing, if each of the vendors,
the Company and the Sole Bookrunner agree to extend the Back-stop Date, or if
one or more (but not all) of the properties in the Portfolio is transferred to
the Company by no later than the Back-stop Date, the Refund will not occur. In
such case: (i) the Company will use its best endeavours to complete the
transfers of all properties in the Portfolio and to obtain JSE approval to list
the Linked Units as soon as possible; and (ii) the Sole Bookrunner will retain
the residual proceeds from the Offering in a non-interest -bearing account for
and on behalf of the Company. Upon receiving confirmation that a property in the
Portfolio has been transferred to the Company, the Sole Bookrunner will, on
behalf of the Company, transfer funds to the Vendor of the respective property
or business, as the case may be.
Once the Offering Conditions are fulfilled, the final condition before the JSE
approves the linked units for Listing and the linked units are delivered to
investors is that written notice be provided to the JSE that the transfer of
each of the properties in the Portfolio has been successfully completed (the
"Listing Condition"). Following satisfaction of the Listing Condition, the
Directors believe that all conditions to Listing will have been satisfied and
therefore expect that the linked units will be approved for Listing. If, for
whatever reason, the JSE does not approve the linked units for Listing after the
Offering Conditions and the Listing Condition are fulfilled, the Refund will not
occur and the Company will use its best endeavours to obtain JSE approval to
list the linked units as soon as possible.
COPIES OF THE PRE-LISTING STATEMENT
The Pre-listing Statement is only available in English and copies thereof may be
obtained (by persons invited to participate in the Offering) during normal
business hours from Monday, 23 April 2012 until Wednesday, 2 May 2012 from the
Company, Citigroup Global Markets Limited and Citigroup Global Markets
(Proprietary) Limited at their respective physical addresses which are set out
below:
Registered office of HRP:
Hermans & Roman House
Tygerberg Park
163 Hendrik Verwoerd Drive
Plattekloof, 7500
South Africa
Registered office of Citigroup Global Markets Limited:
Citigroup Centre
Canada Square
Canary Wharf
London E14 5LB
United Kingdom
Registered office Citigroup Global Markets (Proprietary) Limited:
145 West Street
Sandown
Sandton, 2196
South Africa
Cape Town
23 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
Sole Global Co-ordinator, Sole Bookrunner and Sole Corporate Advisor
Citigroup Global Markets Limited
Sino-India Distribution Agent (Sales into India and China Only)
Cadiz Corporate Solutions, a division of Cadiz Special Projects Limited
Selling Agent (Private Clients in South Africa Only)
BoE Stockbrokers (Proprietary) Limited
Lead Transaction Sponsor
Citigroup Global Markets (Proprietary) Limited
Ongoing JSE Sponsor and Joint Transaction Sponsor
Deloitte & Touche Sponsor Services (Proprietary) Limited
South African Legal Counsel and South African Tax Advisor to the Company
Cliffe Dekker Hofmeyr Inc
Irish Legal Counsel and Irish Tax Advisor to the Company
Mason Hayes & Curran
Zambian Legal Counsel and Zambian Tax Advisor to the Company
Chibesakunda & Company
English Legal Counsel to the Company
DLA Piper UK LLP
Legal Counsel to the Sole Bookrunner as to US and English Law
Latham & Watkins (London) LLP
Legal Counsel to the Sole Bookrunner as to South African Law
Dewey & LeBoeuf (Proprietary) Limited
Independent Auditors and Reporting Accountants to the Company
BDO South Africa Incorporated
Independent Registered Valuer
Mills Fitchet Magnus Penny (Proprietary) Limited
Financial Communications Adviser
College Hill (Proprietary) Limited
Legal Advisor to HBW
Vining Camerer Inc
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: 23/04/2012 07:11:03 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.
