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Prima Property Trust - Disposal By Prima Of Its Entire Business, Winding Up,
Financial Effects, Salient Dates And Withdrawal Of Cautionary Announcement
Prima Property Trust
Share code: PRM ISIN code: ZAE000005641
(`Prima`)
(A collective investment scheme in property managed by Prima Property Trust
Managers Limited (`PPTM`), in terms of the Collective Investment Schemes Control
Act, 45 of 2002 (`CISCA`))
DISPOSAL BY PRIMA OF ITS ENTIRE BUSINESS, WINDING-UP, FINANCIAL EFFECTS, SALIENT
DATES AND WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT
INTRODUCTION
On 21 July 2005, Prima announced on SENS that it had agreed to sell its entire
business comprising its property portfolio (the `disposal`) to ApexHi Properties
Limited (`ApexHi`) and that following the disposal, Prima would be wound-up and
the listing of its units on the JSE Limited (`JSE`) terminated, subject to the
certain conditions.
The financial effects of the disposal and salient dates are set out below.
FINANCIAL EFFECTS
The table below illustrates the pro forma financial effects of the disposal on
the closing prices of Prima units as well as the historical earnings, headline
earnings, net asset value and tangible net asset value per Prima unit. These
financial effects are prepared for illustrative purposes only and may not fairly
represent Prima`s financial position or results of its operations.
Pro forma Pro forma
before the after the
disposal disposal
(cents) (cents) % Change
Consideration per Prima unit
based on unit prices on 1
April 2005 109.00 (1) 116.23 (1) 6,63
Consideration per unit based
on unit prices at 20 July 2005
120.00 (2) 128.92 (2) 7,43
Earnings per unit 16.28 (3) 26.34 (4) 61,81
Headline earnings per unit 12.99 (3) 12.48 (4) (3,90)
Net asset value per unit 95.12 (3) 95.03 (5) (0,10)
Net tangible asset value per
unit 95.12 (3) 95.03 (5) (0,10)
(1) The consideration per Prima unit as set out in the `before disposal` column
of the table is the market price per Prima unit on 1 April 2005, being the
day prior to the first Prima cautionary relating to the disposal. The
consideration per Prima unit as set out in the `after disposal` column of
the table is the market price per combined ApexHi `A` unit and `B` unit
(`combined ApexHi unit`) on 1 April 2005, pro rated by the swap ratio of
5.9 ApexHi linked units for every 100 Prima units (the `swap ratio`);
(2) The consideration per Prima unit as set out in the `before disposal` column
of the table is the market price per Prima unit on 20 July 2005, being the
day prior to the detailed cautionary relating to the disposal. The
consideration per Prima unit as set out in the `after disposal` column of
the table is the market price per combined ApexHi unit on 20 July 2005, pro
rated by the swap ratio;
(3) The historical earnings and headline earnings per Prima unit as set out in
the `before disposal` column of the table are based on Prima`s published
audited results for the year ended 30 April 2005. No adjustment for the
straight lining of income from leases has been made in the Prima results.
The historical net asset value and tangible net asset value per Prima unit
as set out in the `before disposal` column of the table are based on
Prima`s audited balance sheet at 30 April 2005;
(4) The historical earnings and headline earnings per Prima unit as set out in
the `after disposal` column of the table are based on the combined earnings
and headline earnings of ApexHi and Prima, as published in the ApexHi
financial effects announcement, published simultaneously with this
announcement, pro rated by the swap ratio. Such figures are not
representative of the pro rata forward earnings and headline earnings of
ApexHi after the disposal for the following reasons:
* The additional gearing raised and units issued in
consideration for the Ellerine Holdings and Standard Bank
property portfolio acquisitions (as announced on SENS on 28
October 2004 and 6 January 2004, respectively) have been taken
into account in the Prima results and the calculation of
financial effects whereas the income earned from these portfolios
has only been included in the Prima results for some of the
period, being six months in respect of the Ellerine Holdings
portfolio and four months in respect of the Standard Bank
portfolio. Both of these acquisitions were earnings enhancing for
Prima.
* The Prima audited results for the year ended 30 April 2005
(`Prima results`) include a management fee of 0.75% per annum of
the market capitalisation plus borrowings (`enterprise value`) of
Prima whereas ApexHi will pay 0.5% per annum of enterprise value
of ApexHi on the acquisition. This represents a saving of
approximately R2.2 million to ApexHi.
* ApexHi will pay a lower weighted average interest rate on its
borrowings in the next financial year.
* Savings in respect of the rationalisation of the property
management and other operating costs have not been accounted for.
(5) The historical net asset value and tangible net asset value per Prima unit
as set out in the `after disposal` column of the table are based on the
combined net asset value and tangible net asset value of ApexHi and Prima,
as published in the ApexHi financial effects announcement, pro rated by the
swap ratio.
SALIENT DATES AND TIMES
Salient dates and times applicable to the disposal, winding up and distribution
will be published in due course.
CIRCULAR TO UNITHOLDERS
A circular enclosing a notice convening a meeting of Prima unitholders,
including resolutions necessary to approve the disposal and winding up, will be
posted to Prima unitholders on or about 5 September 2005.
WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT
Unitholders are no longer required to exercise caution in their dealings in
Prima units.
Rosebank
5 August 2005
Corporate advisor and sponsor to Prima
Java Capital (Proprietary) Limited
Attorneys to Prima
Fluxmans Attorneys Inc.
Independent expert
Sasfin Corporate Finance,
a division of Sasfin Bank Limited
Reporting accountants and auditors
Grant Thornton
Chartered Accountants and Auditors
Date: 05/08/2005 05:43:14 PM
