| Wed 7 Apr 2004, 17:53 | | Acquisition Of Properties And Issue Of Participat |
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Emira Property Fund - Acquisition Of Properties And Issue Of Participatory
Interests For Cash
Emira Property Fund
A property fund created under the Emira Property Scheme, registered in terms of
the Collective Investment Schemes Control Act
JSE code: EMI
ISIN: ZAE000050712
("Emira" or "the Fund")
ACQUISITION OF PROPERTIES AND ISSUE OF PARTICIPATORY INTERESTS FOR CASH
Introduction
Rand Merchant Bank, a division of FirstRand Bank Limited ("RMB") is authorised
to announce that Emira has entered into a number of agreements in respect of the
acquisition of the following properties ("the acquisitions"):
Strathmore Office Park, Musgrave Rd, Berea, Durban, low rise office buildings;
Momentum House, corner Stranger, Prince Albert and Ordinance Roads, Kingsmead,
Durban, a four storey building, with ground floor retail and three storeys
offices; and
Gateview, Sugar Close, La Lucia Ridge, Umhlanga, Durban, a four storey office
building.
Salient terms of the acquisitions
The salient terms of the acquisitions are summarised below:
Property Considera Effective Vendor
tion (Rm) date
Strathmore Office 16.3 1 January Momentum Property
Park 2004 Investments
(Proprietary)
Limited ("MPI")
Momentum House 27.5 Transfer 67 Old Fort Road
date (Proprietary)
Limited
Gateview 13.8 Transfer Gatemax Two
date (Proprietary)
Limited
All conditions precedent in respect of the acquisitions have been fulfilled and
the conveyancing attorneys have been instructed to proceed with registration of
the acquired properties.
The amounts due to the respective vendors will be settled in cash upon transfer
of the properties and will incur interest at the ruling rate applicable to cash
on call as quoted by RMB from time to time from the effective date until the
date on which Emira takes transfer of the properties.
The cash to be used for the acquisitions arises from two sources, namely,
existing cash resources and the issue participatory interests ("PIs") for cash
as set out in paragraph 6 below.
Rationale for the acquisitions
It is Emira"s strategy to increase the size of its portfolio through the
acquisition of quality properties, which will contribute to net income growth at
yields which enhance the performance of the Fund over the medium term.
Additional cash was raised upon listing in order to finance properties
identified subsequent to listing which would fulfil this goal and this cash
together with cash raised from the issue of new PI has now been used for the
purpose of acquiring these quality properties.
Emira"s investment committee has satisfied itself that the properties acquired
are high quality commercial properties with adequately secured short-term
occupancy rates and that the acquisitions will be yield enhancing to Emira in
the future. Accordingly, it has been decided to proceed with the acquisitions
on the terms set out above.
Financial effects of the acquisition
Although the acquisitions will be yield enhancing for Emira, pro forma financial
effects have not been presented as the acquisitions will not have a significant
effect on Emira"s net asset value or tangible asset value per PI, nor on its
earnings or headline earnings per PI.
Related party transactions
In terms of the Listings Requirements of the JSE Securities Exchange South
Africa ("JSE"), the acquisition of Strathmore Office Park is regarded as a small
related party transaction as the property is being acquired from MPI, which
holds 61% of the Emira PIs in issue.
Accordingly, Emira has provided the JSE with written confirmation from an
independent professional expert that the terms of the acquisition are fair and
reasonable to holders of Emira PIs. The fair and reasonable opinion statement
will lie for inspection at the registered office of Emira, 6 Protea Place,
Sandton for a period of 28 days from the date of this announcement.
Issue of PIs for cash
Emira will fund R6 900 000 of the acquisition consideration through the issue of
PIs for cash and has entered into an agreement with an investor to issue 1 337
676 PIs at an issue price of R5.1582 per PI, being the volume weighted average
price at which PIs traded for the 30 days ended 29 March 2004 . Application
will be made to the JSE for the listing of the PIs with effect from the date of
transfer of the acquired properties to Emira.
Sandton
7 April 2004
Merchant bank and sponsor Independent adviser
RAND MERCHANT BANK (A division KPMG
of FirstRand Bank Limited)
CORPORATE FINANCE
Date: 07/04/2004 05:17:05 PM Produced by the JSE SENS Department
