| Wed 15 Aug 2001, 0:00 | | Rand Leases - Acquisition Of Various Properties An |
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ANNOUNCEMENT
Rand Leases Properties Limited
(Registration number 1978/000870/06)
(Incorporated in the Republic of South Africa)
("Rand Leases"or "the Company")
ACQUISITION OF VARIOUS PROPERTIES AND WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT
1. INTRODUCTION
Further to the cautionary announcements appearing in the press on 8 June
2001and 27 July 2001, BoE Merchant Bank, a division of BoE Bank Limited, is
authorised to announce that agreements have been reached, subject to
fulfilment of the conditions precedent detailed in paragraph 7, whereby Rand
Leases has acquired various properties, as set out more fully below, for a
total consideration of R80 835 416. The gross value of the properties
acquired is approximately R205 762 000. In the interest of brevity, the
particulars of the respective vendors (totaling 25) has not been included
herein, and will be disclosed in the circular to linked unitholders as
referred to in paragraph 8 below.
2. NATURE OF BUSINESS
The properties acquired are commercial and retail in nature and are
currently substantially let and earn income by way of rentals.
3. RATIONALE FOR THE ACQUISITIONS
Rand Leases' strategy is to alter its predominant source of revenue from
that of developing land to that of accruing rentals from the letting of
property. The acquisitions give effect to this strategy.
4. TERMS OF THE ACQUISITIONS
4.1 Bryanston Properties
In terms of an agreement dated 12 August 2001, Rand Leases has acquired a
portfolio of property owning companies and a property, subject to certain
conditions precedent as described in paragraph 7 below, with effect from 15
September 2001 ("the effective date"), for an aggregate purchase
consideration of R69 631 744 to be settled as follows:
- the assumption of the bond liability in respect of the property on the
effective date in the amount of R16 800 000;
- the allotment to the vendors of 14 843 750 Rand Leases linked units and -
the issue to the vendors of renounceable letters of allocation in respect
thereof fourteen days after the closing date (the closing date is three
business days after the effective date);
- the allotment to the vendors of 8 090 025 Rand Leases linked units and the
issue to the vendors of renounceable letters of allocation in respect
thereof six month after the effective date; and
- the allotment to the vendors of 10 086 065 Rand Leases linked units and
the issue to the vendors of renounceable letters of allocation in respect
thereof twelve months after the effective date.
The Bryanston Properties portfolio comprises nine property owning companies
and one property.
4.2 Peter Place Property
In terms of a heads of agreement dated 12 July 2001, Rand Leases has
acquired a property owning company, subject to the conditions precedent as
described in paragraph 7 below, with effect from the effective date, for an
aggregate purchase consideration of R2 750 000 to be settled as follows:
- the allotment and issue to the vendors of 859 375 Rand Leases linked units
six months after the effective date; and
- the allotment and issue to the vendors of 859 375 Rand Leases linked units
twelve months after the effective date.
4.3 Edge Properties
In terms of a heads of agreement dated 3 July 2001, Rand Leases has acquired
three property owning companies, subject to the conditions precedent as
described in paragraph 7 below, with effect from the effective date, for an
aggregate purchase consideration of R8 453 672 to be settled by the
allotment and issue to the vendors of 5 283 545 Rand Leases linked units six
months after the effective date.
The Rand Leases linked units to be allotted and issued by way of
renounceable letters of allocation or to be allotted and issued, in
consideration for the acquisitions, will be placed with selected
institutions, corporations and individuals in terms of a vendor
consideration placing.
5. FINANCIAL EFFECTS
The table below sets out the pro forma effects of the acquisitions on the
earnings per linked unit ("EPLU"), headline earnings per linked units
("Headline EPLU") and net asset value per linked unit ("NAVPLU") based on
the financial results for the interim period ended 31 December 2000. The
assumptions made in the calculations of the pro forma EPLU and Headline EPLU
are based on the following:
- the EPLU and Headline EPLU figure noted in the "before" column is for the
6 month period ended 31 December 2000 as set out in the interim results
published on 28 February 2001; and
- the EPLU and Headline EPLU figure noted in the "after" column reflects the
EPLU and Headline EPLU calculation assuming that the acquisitions had been
effected on 1 July 2000 and assuming that all the new linked units, that
will be issued in settlement of the acquisitions, had been issued on 1 July
2000.
Before After Percentage
(cents) (cents) decrease
EPLU 17.6 13.7 (22%)
Headline 17.6 13.7 (22%)
EPLU
NAVPLU 262 215 (18%)
6. VALUATION REPORT
An external valuator has prepared a valuation report on the properties
acquired. The details shall be included in the circular to linked
unitholders referred to in paragraph 8 below.
7. CONDITIONS PRECEDENT
The acquisitions are conditional upon the fulfilment of the following
conditions precedent:
- approval of the JSE Securities Exchange, South Africa ("JSE");
- unconditional approval of the Competition Commission in respect of the
Bryanston Properties acquisition.
- approval of the shareholders of Rand Leases in general meeting in respect
of the Bryanston Properties acquisition;
- entering into of comprehensive agreements for the Peter Place and Edge
Properties acquisitions;
- provision of an irrevocable undertaking by Rand Leases that a carrying
majority of its shareholders will vote in favour of the Bryanston Properties
acquisition at the aforesaid general meeting;
- Mr B Ansell being appointed as a director of Rand Leases for a specified
minimum period;
- release of all sureties for mortgage bonds registered over the relevant
properties; and
- the successful placing of the vendor consideration linked units.
8. DOCUMENTATION
A circular containing full details of the acquisitions, incorporating a pre-
listing statement and convening a general meeting of shareholders to approve
the Bryanston Properties acquisition shall be posted to linked unitholders
in due course.
9. WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT
Shareholders are advised that as a result of the announcement of the
acquisitions, caution is no longer required when dealing in Rand Leases'
shares.
Johannesburg
15 August 2001
Corporate Sponsor
Advisor
- BoE Merchant Competition Attorneys -BoE Securities-
Bank - Cliffe Dekker Fuller
Moore
Reporting Property Valuator Legal Advisors
Accountants George, Rennies and Deneys Reitz
Andersen Malakou
