| Wed 13 Nov 2002, 10:44 | | Fairvest Property Holdings Limited Detailed Announ |
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Fairvest Property Holdings Limited Detailed announcement regarding the
acquisition by Fairvest of a portfolio of properties, the disposal of certain
properties and renewal of cautionary
Fairvest Property Holdings Limited
(Formerly Glocash Investments Limited)
(Incorporated in the Republic of South Africa)
(Registration number 1998/005011/06)
JSE Share code: FVT ISIN: ZAE000034658
("Fairvest" or "the Company")
Detailed announcement regarding the acquisition by Fairvest of a portfolio of
properties, the disposal of certain properties and renewal of cautionary
1. Introduction
Further to the renewal of cautionary announcement dated 25 September 2002,
linked unit holders are advised that the Company has reached agreement subject
to certain conditions precedent, to acquire a number of property portfolio`s
comprising 44 properties with a gross value of R420 million ("the acquisition"),
the details and funding of which are set out in paragraphs 2 and 3,
respectively.
The acquisition is consistent with Fairvest`s stated objective of growing its
portfolio with quality high yielding properties. The acquisition will be
effected by Fairvest acquiring the entire issued share capital of and loan
account claims against Daisy Street Investments 127 (Pty) Limited.
The gross value of Fairvest`s portfolio after the acquisition will amount to
R735,3 million.
Fairvest has in addition received a written offer to acquire certain of its
existing properties, for a gross consideration of R77,9 million ("the
disposal"), the details of which are set out in paragraph 5.
2. Details of the portfolio`s to be acquired in terms of the acquisition are as
follows:
Type of Number of Value
Portfolio Vendors property properties (R millions)
Cassadee Cassadee (Pty) Limited Industrial 9 61,2
Graydon Property
Projects (Pty) Limited
The Kwartel Trust
The Castle Trust
Rentmeester Rentmeester Assurance
Limited Offices 11 91,0
Anton Mostert Anton Leonard Mostert Industrial 11 23,1
The Alm Trust
Altix Holdings (Pty)
Limited
Bayswater Allan Isbister
Family Trust - Offices 1 35,5
CDA Property Consultants
(Pty) Limited - Development
of an
additional
800 m2 of
Anton Leonard Mostert spare bulk 4,5
Global Timbers (Pty) Limited
Investec Bank Limited
Eastleigh
Industrial Jan Pieter van Gemert Industrial 1 2,4
Sanlam
Properties Rycklof - Beleggings
(Pty) Limited Industrial,
Retail and 6 147,8
Offices
Sanlam Life
Insurance Limited
East Rand
Junction Globus Investments
(Pty) Limited Offices and Retail 1 41,0
Lothian Trust Malcolm Phillips Retail and
Industrial 4 13,5
Clive Gouws
Total 44 420,0
3. Funding of the portfolio`s
The portfolio`s will be funded as follows:
Amount
Type of funding (R millions)
- The issuing of 28,2 million linked units at an
issue price of R1,50 per linked unit 42,3
- The issue of Compulsorily Convertible
Debentures at varying rates of interest
which are compulsorily convertible into
linked units over periods ranging from
3 - 5 years, based on the linked unit price
ruling at the date of conversion 129,7
- Raising of mortgage bonds over the
portfolio`s together with deferred payments.
The deferred payments will commence two years
after the implementation of the acquisition 248,0
Total 420,0
4. Asset management
The board of directors of Fairvest ("the board") intends to conclude an asset
management agreement with Sanlam Property Asset Management (Proprietary) Limited
("Sanlam Properties"), in terms of which Sanlam Properties will asset manage the
entire portfolio. Details of the asset management agreement will be set out in
the circular to Fairvest linked unit holders and a resolution to approve the
agreement will be proposed at the general meeting to be convened in terms of
such circular ("the general meeting").
5. Disposal of certain properties
Fairvest has in addition received a written offer from Daisy Street
Investments 165 (Proprietary) Limited ("Daisy 165") to acquire the following
properties for a total gross value of R77,9 million. The board is currently
considering the offer and will make a formal decision in regard thereto at a
board meeting to be held on Thursday, 14 November 2002.
Value
Property (R millions)
Proprint House 8,9
Kempton City 37,1
Mangrove Beach 11,4
Mitri House 2,5
Nedbank Props 16,0
Ambassador House 2,0
Total 77,9
The offer is subject to Fairvest ensuring that a property finance facility
not exceeding R42,7 million will be arranged by Daisy 165 and the balance, being
R35,2 million, to be settled by the issue of linked units to be issued by a
listed company which company will place an acquisition announcement regarding
its acquisition of Daisy 165 in the press following the Fairvest board meeting
referred to above.
6. Change of name
Following the acquisition, Fairvest proposes to change its name to REIT
Property Holdings Limited, REIT being an acronym for "Real Estate and Investment
Trust", which name the board believes more fully describes Fairvest`s nature of
business, being that of a property investment trust. A special resolution to
approve this change of name will be proposed at the general meeting.
7. Conditions precedent
The acquisition and the disposal is subject to the following conditions
precedent:
* approval of the acquisition and the disposal by the requisite majority of
Fairvest shareholders;
* approval by the JSE Securities Exchange South Africa ("the JSE") for the
listing of the linked units to be issued in terms of the acquisition; and
* approvals of other regulatory authorities including the Competition
Commission.
8. Financial effects of the acquisition and the disposal
The pro forma financial effects of the acquisition and disposal will not be
disclosed at this stage, as the audit in respect of the year ended 30 September
2002, is in the process of completion and the results of which, including the
income distribution to linked unit holders, will be announced by no later than
30 November 2002. The pro forma financial effects of the acquisition and the
disposal will be announced simultaneously with the results announcement.
9. Related party transactions
The acquisition and the disposal constitute related party transactions in
that certain vendors of the portfolio`s are associated with Niki Vontas, a
director of Fairvest ("Vontas"), and Daisy 165 is represented by Vontas.
Consequently, an opinion from an independent adviser regarding the fairness and
reasonableness of the acquisition and the disposal to Fairvest linked unit
holders will be contained in the circular to linked unit holders referred to in
paragraph 11 below.
10. Renewal of cautionary announcement
Linked unit holders are accordingly advised to continue exercising caution
when dealing in their linked units on the JSE until the pro forma financial
effects of the acquisition and disposal are announced.
11. Circular to linked unit holders
A circular to Fairvest linked unit holders containing details of the
proposed acquisition and disposal is in the course of preparation and will be
mailed in due course.
Johannesburg
12 November 2002
Sponsor
LPC Manhattan Sponsors (Pty) Ltd
(Registration number 1999/024792/07)
Attorneys
Moss-Morris
Date: 13/11/2002 08:02:51 AM Produced by the JSE SENS Department
