| Tue 13 Nov 2001, 0:00 | | Paraprop - Acquisition Of Further Properties And F |
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announcement
Paramount Property Fund Limited
(formerly Ovbel Holdings Limited)
(Incorporated in the Republic of South Africa)
(Registration number 1945/019928/06)
Share code PRA ISIN ZAE000028577
("Paraprop" or "the company")
Acquisition of further properties and further cautionary announcement
1. Acquisition of properties
Further to the cautionary announcement dated 26 September 2001, Paraprop
linked unitholders are advised that, subject to the conditions precedent set
out in paragraph 5 below, agreements have been entered into to acquire nine
further properties at a total cost of R97 716 767, collectively, "the
acquisitions". Details of the acquisitions are set out below:
Settlement by
Purchase Linked
price Cash units debentures
Property Rand Rand Rand value Rand value
Kya North Village, Kya Sands 19 600 000 13 500 000 2 180 000 3 920 000
Independence Square, Ottery 15 581 767 10 128 152 2 337 265 3 116 350
Sportsmans Warehouse,
Rondebosch 13 405 000 8 205 000 2 600 000 2 600 000
Fountain Grove, Sandton 12 600 000 7 560 000 2 520 000 2 520 000
Sovereign Quays, Greenpoint 10 700 000 7 400 000 1 160 000 2 140 000
Genuine Parts, Jet Park 9 300 000 5 580 000 1 860 000 1 860 000
Sportsmans Warehouse,
Tygervalley 8 280 000 5 080 000 1 600 000 1 600 000
National Socket Screws,
Jet Park 4 900 000 2 940 000 980 000 980 000
Bestobel, Jet Park 3 350 000 2 010 000 670 000 670 000
97 716 767 62 403 152 15 907 265 19 406 350
The linked units are to be issued at a price of 500 cents per linked unit.
The B debentures are to be issued at a price of 500 cents per B debenture.
1.1 Kya North Village, Kya Sands
Vendor: Kya North Village (Proprietary) Limited.
A modern, attractive industrial mini-unit complex comprising 53 units with a
range of tenants.
1.2 Independence Square, Ottery
Vendor: Independent Square (Proprietary) Limited.
A well-located, modern industrial complex with high visibility, consisting
of four warehouses.
1.3 Fountain Grove, Sandton
Vendor: Fountain Grove (Proprietary) Limited.
A new office development in a prime location on William Nicol drive in
Sandton.
1.4 Sportsmans Warehouse, Rondebosch
Vendor: Blue Dot Property 281 (Proprietary) Limited.
A single storey retail warehouse.
1.5 Sovereign Quays, Greenpoint
Vendor: Trustees of the Sovereign Quay No. One Trust.
Comprises three sections of the Sovereign Quay development.
1.6 Genuine Parts, Jet Park
Vendor: Prostart Properties 115 (Proprietary) Limited.
An industrial warehouse property.
1.7 Sportsmans Warehouse, Tygervalley
Vendor: The Trustees of the Templeton, the Perth, the Emile Kruger Family
and the Chantal Ffoulkes Trusts.
A single storey retail warehouse.
1.8 National Socket Screws, Jet Park
Vendor: Prostart Properties 115 (Proprietary) Limited.
An industrial warehouse.
1.9 Bestobel, Jet Park
Vendor: Prostart Properties 115 (Proprietary) Limited.
An office property close to Johannesburg International airport.
2. Effective date
The effective date of the acquisitions is 1 November 2001 except for
Sportsman's Warehouse, Rondebosch and Tygervalley where the date will be the
first day of the month in which the date of transfer of the property falls.
3. Rationale
The acquisition of the properties is in line with the strategy of the
company to provide linked unitholders with a sustainable growing annuity
income stream and capital growth.
In addition, the acquisitions will grow the portfolio thereby providing risk
diversification and increased market capitalisation.
4. Financial effects
The table below sets out the pro forma financial effects of the acquisitions
in comparison to the unaudited results for the six months ended 30 April
2001, based on the assumptions given below:
After After
Before (Unadjusted)1 (Adjusted)2 Change
Headline earnings
per linked unit 20,5 17,0 20,9 2,0%
Tangible net asset value
per linked unit 479,2 480,6 480,6 0,3%
Linked units in issue ('000) 10 279 13 460 13 460 -
Assumptions:
* the effective date of all of the transactions is based on a date of 1
November 2000; and
* interest on borrowings is calculated at a pre-tax rate of 12,5%.
Notes:
1. The "After (Unadjusted)" column is based on the latest audited results of
the properties without any adjustments, which represents the historical
performance prior to acquisition.
2. The "After (Adjusted)" column reflects the latest audited results
adjusted for non-recurring tenant installation costs, extraordinary bad
debts and lease premiums. The rationale for the adjustments is to provide a
fairer reflection of expected performance.
The directors are of the opinion that these properties will improve the
quality of the portfolio and enhance earnings and distributions.
5. Conditions precedent
The acquisitions are subject, inter alia, and, where applicable, to the
following conditions precedent:
* the JSE Securities Exchange South Africa ("JSE") granting a listing for
the new linked units to be issued; and
* the necessary regulatory approvals being obtained.
6. Circular to SHAREHOLDERS
A circular giving details of the acquisitions will, subject to the approval
of the JSE, be sent to shareholders within 28 days of this announcement.
7. Further cautionary announcement
Linked unitholders are advised that further negotiations are in progress
which, if successfully concluded, may have a material effect on the price of
the company's linked units on the JSE. Accordingly, linked unitholders are
advised to continue exercising caution when dealing in the company's linked
units until a further announcement is made.
Cape Town
13 November 2001
Corporate adviser and sponsor
Barnard Jacobs Mellet Corporate Finance
Attorneys
Cliffe Dekker Fuller Moore Inc
(Registration number 1998/018173/21)
Reporting accountants
Deloitte & Touche
Independent property valuers
Mills Fitchet Magnus Penny (Proprietary) limited
Fund managers
Aspire Property Services
