Unit Holders Approve Redefine Income Fund Bid To A
Unit Holders Approve Redefine Income Fund Bid To Acquire Rand Leases Properties
Investment Property Portfolio
Redefine Income Fund
PROPERTY loan stock company Redefine Income Fund announced today that the bid by
wholly-owned subsidiary Outward Investments to acquire a portfolio of 27
investment properties from Rand Leases Properties (RL Props) was approved on
Friday, December 29, by linked unit holders of both companies in separate
general meetings.
Redefine CEO Peter Penhall said that, subject only to approval by the
Competition Board which is expected on or before December 15, the R356,4-million
deal would grant Redefine ownership of a portfolio that offered significant
income and asset growth through 24 well-tenanted mainly `A` Grade office
properties and three prominent retail centres: the Post House and Wedge Shopping
Centre in the Bryanston Wedge growth areas and the Corporate Shopping Centre in
Midrand.
Vacancies in the RL Props portfolio, which have been partially discounted in the
purchase price, represented 4.5 percent of gross lettable area.
Penhall said: "Many of the properties comply with Redefine`s preferred criteria
of single tenanted long lease structures, with the lease expiry profile falling
mainly in the 3-5 year category.
"The few properties which fall outside Redefine`s core property ownership
criteria will be upgraded prior to disposal to ensure a maximum return on
investment."
Another outcome of the transaction is that Redefine reduces its investment in R
L Props from 28,7 percent to 15 percent, and a more focused R L Props reverts to
its original role of a land and property developer.
Penhall said that, as reported earlier in the year, the transaction would be
funded by way of cash and the issue of Redefine linked units at R2,47 per linked
unit. The deal includes a buy-back of 14 million R L Props linked units from
Outward Investments.
The transaction`s apparent minor dilutionary effect in earnings during the 2003
financial year would be offset by perceived opportunities to immediately enhance
earnings within the portfolio, Penhall said.
When finalised, the acquisition would raise Redefine`s total asset base to R2,2-
billion, a market-perceived benchmark that brought the property loan stock
company closer to achieving its goal of increasing market capitalisation beyond
R1-billion.
At the prevailing linked unit price, Redefine`s market capitalisation was
approximately R873-million.
Date: 02/12/2002 04:10:01 PM Produced by the JSE SENS Department
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