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SYCOM PROPERTY FUND
("Sycom")
A unit trust scheme in property shares registered in terms of the Unit Trusts
Control Act, No 54 of 1981 and managed by NIB Property Fund Managers Limited
(Registration number 1986/002756/06)
Acquisition of certain properties by Sycom
1. INTRODUCTION
Nedcor Investment Bank Limited is authorised to announce that Sycom has entered
into an agreement with AECI Pension Fund ("AECI-PF") in terms of which Sycom
acquired property and undivided shares in property from
AECI-PF ("the acquisition"), namely:
- the Riverwoods Office Park, Bedfordview;
- a 10% undivided share in the Somerset Mall Shopping Centre in Somerset West;
and
- a 40% undivided share in the Woodlands Office Park, Woodmead, Sandton
(collectively, the "AECI-PF properties").
2. TERMS OF THE ACQUISITION
Sycom will acquire the AECI-PF properties from AECI-PF with effect from 1
January 2001 for a purchase consideration of R217 775 972,00 to be settled by
the allotment and issue of 27 612 723 Sycom units ("the Sycom consideration
units") to AECI-PF at an issue price of R7,89 each (being the current reported
net asset value per Sycom unit).
3. RATIONALE FOR THE ACQUISITION AND PROSPECTS OF SYCOM
The AECI-PF properties are compatible in terms of both quality and type with
the existing Sycom property portfolio, which is fairly evenly weighted between
the retail and commercial office sectors.
Sycom derives its revenues from property rentals and the quality of the income
stream from the acquisition will assist in maintaining future earnings and
earnings growth. In addition, the increased size of the Fund, which will, after
the transaction, have a market capitalisation in excess of R1 billion, should
enhance the tradeability of Sycom units. This will assist in the Fund retaining
its premium rating in the Property Unit Trust sector.
4. CONDITIONS PRECEDENT
The acquisition is subject to the fulfilment of various conditions precedent,
including obtaining certain regulatory approvals from the Trustee of Sycom, the
JSE Securities Exchange South Africa ("JSE"), the Registrar of Unit Trust
Companies, the Registrar of Pension Funds and the Competition Commission, to
the extent that these may be necessary (the "conditions precedent").
5. FINANCIAL EFFECTS ON SYCOM UNITHOLDERS
The financial effects of the acquisition are recorded in the table below which
has been prepared on the following bases:
- the column headed "Before" reflects Sycom's published audited results for the
year ended 31 December 2000 and 104 833 176 Sycom units in issue for that
period; and
- the column headed "After" incorporates the AECI-PF properties' results for
the year ended 31 December 2000 based on the assumption that the Sycom
consideration units were issued on 1 January 2000. It should be noted that
during the period 1 January 2000 to 31 December 2000, the AECI-PF properties
underwent significant expansion, with the income generated from the additional
rentable areas coming on stream at different times during the course of the
year. The earnings reflected hereafter have been adjusted as if the additional
areas had been income producing for the full year.
Percentage
Per Sycom unit Before After change
Headline earnings (cents) 97 96 (1,1)
Net asset value (cents)* 789 792 0,4
*Comprising tangible assets only
6. JSE LISTING AND FURTHER ANNOUNCEMENT
Application will be made to the Listings Committee of the JSE to grant a
listing of the Sycom consideration units on the JSE pursuant to the conditions
precedent being met. Once the conditions precedent have been fulfilled a
further announcement in this regard will be made.
7. DOCUMENTATION
A circular containing further details of the acquisition will be posted to
unitholders within 28 days of this announcement.
Johannesburg
19 April 2001
Investment bank and sponsor
Nedcor Investment Bank
Asset manager
Coronib
Property Asset Managers
Corporate law advisers and consultants
Edward Nathan & Friedland (Pty) Ltd
(Registration number 1999/026464/07)
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