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Acucap Properties Limited - Acquisition of Festival Mall
ACUCAP PROPERTIES LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2001/021725/06)
Share code: ACP
ISIN: ZAE000037651
(`Acucap`)
ACQUISITION OF FESTIVAL MALL
1. Introduction
Linked unit holders are advised that Acucap has entered into a formal agreement
dated 21 February 2005, through its wholly owned subsidiary Acucap Investments 3
(Proprietary) Limited, with Straightprops 99 (Proprietary) Limited (``the
seller`) to acquire Festival Mall situated on the corner of CR Swart and Kelvin
Roads, Kempton Park (`the acquisition`). Festival Mall has been constructed
adjacent to Acucap`s existing Kempton Park Hyperama and acquired as a turnkey
development. The existing centre has been linked to the new Festival Mall,
creating a single regional shopping centre with a gross lettable area (`GLA`) of
over 65,000m2, anchored by Checkers, Pick `n Pay, Woolworths and Edgars. Over
70% of the centre is occupied by national tenants and national franchise stores.
Details of this acquisition were initially set out in an announcement to linked
unit holders dated 18 September 2003.
The effective date of the acquisition is 31 March 2005, and it is expected that
the property will transfer around that time.
2. Rationale for the acquisition
The acquisition is in line with Acucap`s strategy of maintaining a sectoral bias
towards retail assets, and of acquiring retail properties that are dominant in
their defined markets. Such assets will contribute to a sustained growth in
distributions to linked unit holders, and will also enhance the long term growth
in the market value of Acucap`s property portfolio.
The acquisition of the Festival Mall as a new development is in line with
Acucap`s strategy of concluding turnkey developments for new retail centres to
address the shortage of existing properties suitable for acquisition.
3. Consideration for the acquisition
The consideration for the acquisition is R247 million, of which R237 million
will be paid in cash on the date of transfer of the property. The remaining R10
million of the consideration will be settled through the issue of Acucap linked
units (`the consideration linked units`). The consideration linked units will be
issued on completion of the small commercial phase comprising approximately 1
900m2 of GLA (`the commercial phase`) of the Festival Mall development at the
ninety day weighted average traded price of the Acucap linked units on the JSE
Securities Exchange South Africa prior to the completion of the commercial
phase.
4. Unaudited pro forma financial effects of the acquisition
Based on the published consolidated reviewed results of Acucap for the 6 months
ended 30 September 2004, the unaudited pro forma financial effects of the
acquisition on Acucap`s earnings per linked unit (`EPLU`), headline earnings per
linked unit (`HEPLU`), net asset value per linked unit (`NAV`), net tangible
asset per linked unit (`NTAV`) and distribution per linked unit are set out
below. This unaudited pro forma financial information has been prepared for
illustrative purposes only and because of its nature may not give a fair
reflection of Acucap`s financial position and results of operations, nor the
effect and impact of the acquisition on Acucap going forward.
Before the After the % Change
acquisition acquisition
(1) (2)
EPLU (cents) 81.00 105.83 30.65
HEPLU (cents) 75.18 74.95(3) (0.31)
NAV (cents) 1 179.45 1 221.01(4) 3.52
NTAV (cents) 1 151.29 1 193.03 3.63
Distribution per 71.48 71.26 (0.31)
linked unit
Linked units in
issue for 51 547 831 51 547 831 -
calculating EPLU and
HEPLU
Linked units in
issue for 54 170 782 54 170 782 -
calculating NAV,
NTAV and
distribution per
linked unit
Notes:
1) Based on the published consolidated reviewed results of Acucap for the 6
months ended 30 September 2004.
2) Based on the assumption that the acquisition took place on 1 April 2004 for
income statement purposes and on 30 September 2004 for balance sheet purposes.
3) Determined after taking into account the earnings attributable to Festival
Mall for the 6-month period ended 30 September 2004. As Festival Mall is a new
development, there is no historical financial information relating to Festival
Mall for the 6-month period ended 30 September 2004. Notwithstanding this, the
forecast earnings attributable to Festival Mall for the 12 months ending 31
March 2006 were de-escalated at appropriate rates in order to arrive at
indicative earnings attributable to Festival Mall for the 6 months ended 30
September 2004.
4) Based on the assumption that the acquisition has been effected, that the cash
consideration has been paid and that the consideration linked units have been
recorded as an outstanding liability. The pro forma fully diluted effect of the
issue of the consideration linked units on EPLU and HEPLU has not been taken
into account as no forecast earnings have been attributed to the commercial
phase in arriving at the forecast earnings attributable to the Festival Mall.
5) Conditions precedent relating to the acquisition
All conditions precedent have been fulfilled regarding the acquisition.
6) Further information
A circular containing full details of the acquisition will be posted to Acucap
linked unit holders in due course.
Cape Town
22 February 2004
Investment bank and sponsor
Nedbank Capital
Independent reporting accountants
KPMG Inc.
Corporate law advisers
Edward Nathan (Proprietary) Limited
Date: 22/02/2005 04:18:03 PM
Produced by the JSE SENS Department
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