| Thu 14 Jun 2001, 0:00 | | Acquisition Of Properties By Primegro |
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PRIMEGRO PROPERTIES LIMITED
AND ITS SUBSIDIARIES
(Incorporated in the Republic of South Africa)
(Registration number 1998/018436/06)
Executive Directors: M Ettin, D Greenberg, L Levinsohn
Non-executive Directors: J F Marais (Chairman), L Butler, D Claassen, P
Fechter, E Loubser, H Mocke, J Molobela
Acquisition of properties by Primegro
1. Introduction
Nedcor Investment Bank Limited is authorised to announce that Primegro has
entered into various acquisition agreements (the "acquisitions"), in terms
of which it has acquired the following properties:
1.1 Drager SA Head Office Building from St Peters Square (Pty) Ltd;
J Walter Thompson Head Office from New Adventure Investments (Pty) Ltd;
Emerson Energy Systems from Highbrow Holdings (Pty) Ltd; and
50% share in vacant land from Electprops 9 (Pty) Ltd,
(the "5th Avenue properties"); and
1.2 The Dimension Data Building, Fourways Golf Park from Renown Properties
Limited,
(collectively, "the properties").
2. Terms of the acquisition
2.1 The 5th Avenue properties
Property Location
Drager SA Head Office Building Corner Witkoppen Road and Waterford
Place
J Walter Thompson Head Office Corner 12th Avenue and Rivonia Road
Emerson Energy Systems Head Office Naivasha Road, Sunninghill
50% share in vacant Land Adjacent to J Walter Thompson Head
Office
Aggregate purchase consideration R39 106 169
Bonds raised R19 640 234
Deferred liability R3 768 187
Primegro linked units issued
to the value of R15 697 748
Notes:
i) A number of the Primegro linked units will not be issued immediately as
the vendors have agreed to accept deferred linked units, which will convert
into Primegro linked units in the future. These deferred linked units will
be held in trust by the attorneys of Primegro and will not immediately be
listed on the JSE Securities Exchange South Africa ("the JSE"). They will
also not rank for any Primegro distribution until they are converted into
Primegro linked units. The table below sets out the details of the deferred
linked units and their conversion dates:
First period for which
a distribution
Value Conversion date will be paid
R2 500 000 1 November 2001 Six-month
interim period
commencing on
1 November 2001
R2 302 190 1 November 2002 Six-month
interim period
commencing on
1 November 2002
Primegro linked unitholders will be requested, at a general meeting to be
convened in terms of the circular referred to in paragraph 6 below, to
approve the creation and terms of the deferred linked units.
ii) Of the Primegro linked units to be issued, 1 911 501 were placed on
behalf of the vendors with a financial institution at an issue price of
R5,70 per linked unit, which equates to R10 895 558. The balance of Primegro
linked units to be issued will be that number of Primegro linked units that
equate to R4 802 190, at the weighted average price from 1 June to 30 June
2001 of Primegro linked units traded on the JSE.
2.2 The Dimension Data Building, Fourways Golf Park
Location Witkoppen Extension 54, Fourways Golf Park
Purchase consideration R8 100 000
Bonds raised R4 050 000
Deferred liability R810 000
Primegro linked units issued R3 240 000, equating to 568 421
Primegro linked units
Issue price per linked unit R5,70 per linked unit
Notes:
i) The deferred liability will be settled by way of four equal cash
payments, to be made on the four respective anniversaries of the date of
transfer of Fourways Golf Park to Primegro.
ii) The 568 421 Primegro linked units issued were placed on behalf of the
vendors with a financial institution at an issue price of R5,70 per Primegro
linked unit.
3. Rationale for the acquisition and prospects of Primegro
As stated in the Primegro pre-listing statement, a primary long-term
objective of Primegro is to establish a portfolio of quality, well-
positioned, income producing properties with a value in excess of R2
billion. Primegro has since its inception moved aggressively to increase the
quality and size of its portfolio, as evidenced by its recent acquisition of
properties from Sanlam Limited, Fedsure Holdings Limited, the Picbel vendors
and Mawenzi Resources Limited which took Primegro's portfolio size from R668
million to R1 120 million.
This drive to increase the quality and size of the portfolio is continuing
and has now led to Primegro acquiring the properties, further increasing its
portfolio size from R1 120 million to R1 167 million. The resultant larger
market capitalisation is intended to make Primegro's linked units more
liquid, tradable and attractive to investors.
4. Financial effects on Primegro linked unitholders
The financial effects of the acquisition are recorded in the table below.
The table has been prepared on the following bases:
* the column headed "Before" reflects Primegro's interim results for the six
months ended 30 April 2001; and
* the column headed "After" incorporates the properties' results for the six
months ended 30 April 2001 based on the assumption that the properties had
been part of the Primegro portfolio for such period.
Percentage
Per Primegro linked unit Before After change
Earnings (cents) 43,27 43,68 0,9
Net asset value (cents) 504 505 0,2
5. Jse listing and further announcement
Application will be made to the JSE to grant a listing of Primegro linked
units as follows:
i) with immediate effect, the 1 911 501 Primegro linked units mentioned in
note ii) paragraph 2.1;
ii) with immediate effect the 568 421 Primegro linked units issued as part
consideration for fourways Golf Park; and
iii) as soon as possible after the respective conversions of the deferred
linked units into Primegro linked units as mentioned in note i) of paragraph
2.1.
6. Amendment to the articles of association of Primegro
A circular, subject to the approval of the JSE, containing details of an
amendment to the articles of association of Primegro in order to create the
deferred linked units and containing a notice of general meeting of Primegro
linked unitholders, is currently being prepared and will be sent to Primegro
linked unitholders shortly.
Johannesburg
14 June 2001
Investment bank and sponsor
Nedcor Investment Bank
Attorneys
Jowell, Glyn & Marais Inc
(Registration number 1990/000849/21)
