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PARAMOUNT PROPERTY FUND LIMITED - ACQUISITION OF PROPERTIES
PARAMOUNT PROPERTY FUND LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1945/019928/06)
Share code: PRA ISIN: ZAE000028577
("Paraprop" or the "company")
ACQUISITION OF PROPERTIES
1. Introduction
Linked unitholders are advised that Paraprop has entered into agreements to
acquire two properties, namely:
De Waterkant Centre, Greenpoint ("De Waterkant"); and
52 Goodwood Road, Pinetown ("Goodwood Road")
for a total consideration of R49 400 000 ("the acquisitions").
Details relating to the acquisitions are set out below:
Purchase Settlement by
Property price B
Rand Cash Linked debentures
Rand units Rand value
Rand
value
De Waterkant, 38 900 000 26 110 000 3 720 000 9 070 000
Vendor: Onaghan
Investments No.2
(Pty) Ltd
Goodwood Road 10 500 000 6 300 000 2 100 000 2 100 000
Vendor: Ithala
Development
Finance
Corporation Ltd
Total 49 400 000 32 410 000 5 820 000 11 170 000
The cash portion of the purchase consideration for the above acquisitions
has been raised by way of long-term loans from Paraprop`s bankers.
The issue price of the linked units and B Debentures in respect of De
Waterkant will be 480 cents each.
The issue price of the linked units and B Debentures in respect of Goodwood
Road will be 500 cents each.
2. Effective date
The effective date of the acquisitions is 1 May 2002.
3. Rationale
De Waterkant is an "A" grade office and retail building in a prominent
location on Somerset Road, Greenpoint, Cape Town and comprises 5 396 square
metres. The Centre has a stable tenant base, with low vacancy levels.
Goodwood Road is an industrial property in the up-market industrial area of
Mahogany Ridge, Durban and comprises 4 460 square metres. An international
tenant occupies the property.
The acquisitions are in line with the strategy of the company to provide
linked unitholders with a sustainable growing annuity income stream and
capital growth. In addition to growing Paraprop`s property portfolio, the
acquisitions will diversify the company`s risk and increase its market
capitalisation.
4. Financial effects
The De Waterkant and Goodwood Road properties were only completed recently
and have been occupied for a limited period of time. Consequently, no
historical information is available on these acquisitions and the pro forma
financial effects of the acquisitions would not be meaningful to linked
unitholders. Furthermore, the acquisitions have no material impact on
Paraprop`s net asset value.
5. Forecast distribution
With the financial effects of the acquisitions not providing any reflection
of historic financial performance, it has been decided by the directors to
include a profit forecast to provide unitholders with an estimation of
future earnings.
The forecast distribution for the year ending 31 October 2002 is 86,4 cents
per linked unit, an increase of 8% over the annualised distribution of 80,0
cents per linked unit for the financial year ended 31 October 2001.
The company`s auditors have reviewed the profit forecast for the year ending
31 October 2002 and are satisfied that it has been prepared in accordance
with paragraph 8.46(c) of the Listings Requirements of the JSE Securities
Exchange South Africa ("the JSE").
Their review letter relating to the profit forecast is available for public
inspection at the Company`s registered offices.
6. Circular to linked unitholders
A circular giving details of the De Waterkant acquisition will, subject to
the approval of the JSE, be sent to shareholders within 28 days of this
announcement.
Cape Town
13 May 2002
Corporate adviser and Attorneys
sponsor Cliffe Dekker Inc.
Barnard Jacobs Mellet
Corporate Finance
Independent reporting Independent property valuers
accountants and auditors Mills Fitchet
Deloitte & Touche
Fund and property managers
Spire Property Services
Date: 13/05/2002 05:05:00 PM Produced by the SENS Department
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