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IFH
IFH
IFA - The acquisition by IFA of a 19,25% interest in the Boschendal estate and
extension of cautionary announcement
IFA Hotels & Resorts Limited
(formerly Moribo Leisure Limited)
(Incorporated in the Republic of South Africa)
(Registration number 1919/001318/06)
Share code: IFH
ISIN: ZAE000075669
("IFA" or "the company")
The acquisition by IFA of a 19,25% interest in the Boschendal estate and
extension of cautionary announcement
1. Introduction
Further to the cautionary announcement dated 10 May 2006, IFA is pleased to
announce that an agreement has been reached regarding its acquisition of an
interest in the Boschendal estate located in the Western Cape ("the
acquisition").
In terms of this agreement, IFA has purchased and has the right to take
transfer of 19,25% of the issued shares of Boschendal Limited (registration
number 2002/023534/06) ("Boschendal") and Purple Plum Properties 59 Limited
(registration number 2002/014687/06) ("Purple Plum") and the right to take
cession of certain shareholders" loans in Boschendal, together with certain
ancillary rights.
2. Details and terms of the acquisition
2.1 The purchase consideration
The purchase consideration in respect of the acquisition amounts to
R53 902 788 which is payable in cash against transfer of the relevant
shares and cession of the relevant loan accounts to IFA.
2.2 The vendors
The vendors are:
- the trustees of the Harold Johnson Family Trust (Trust No IT 703/96)
in respect of 9% of the issued shares in both Boschendal and Purple
Plum and a shareholder"s loan in Boschendal in the sum of R20 million;
and
- Bosch Trading Limited (registration number CR 129624, being a company
incorporated in the Cayman Islands) in respect of 10,25% of the issued
shares in both Boschendal and Purple Plum and a shareholder"s loan in
Boschendal in the sum of R20 million.
2.3 The effective date
The effective date of the acquisition is the date of transfer of the shares
and cession of the loan accounts to IFA.
2.4 Conditions precedent
The acquisition is unconditional.
3. Rationale for the acquisition
The future development plans for the 2 400ha Boschendal estate include an
upmarket retirement village with 500 individual homes, a boutique hotel
with upwards of 80 keys and a mixed-use development of a shopping centre,
offices and apartments. Gross land sales are expected to generate
approximately R2.2 billion. The acquisition therefore supports IFA"s
strategy to deliver new premier resort and residential developments in
South Africa, whilst affording the IFA group the opportunity to diversify
from Kwa-Zulu Natal (where it owns the Zimbali Lodge and a 50% stake in the
joint venture that developed the Zimbali Coastal Resort), into the Western
Cape region. The acquisition also affirms the intention of the
international IFA Hotels & Resorts group to use the South African based
operation as a platform for continued investment in Africa in order to
expand its global network of resorts, delivering prime opportunities in
tourism and real estate to global investors.
In addition, the acquisition further demonstrates IFA"s commitment to
sustainable transformation at a grass-roots level as the company will now
be participating in the Boschendal transformation programme which is
expected to generate more than R100 million in cash and contribute 270ha of
land to the local community over the next 10 years.
4. Pro forma financial effects
The pro forma financial effects presented below are the responsibility of
the board of IFA and are presented for illustrative purposes only to
provide information on how the acquisition might have impacted on the
reported financial information of the company if it had been implemented in
the six months ended 31 December 2005. Because of their nature, the pro
forma financial effects may not give a fair reflection of the company"s
financial results for that six month period and its financial position at
31 December 2005.
Before the After the % change
acquisition acquisition2 and
1 3
Earnings per 9.17 11.252 22.68%
share for the six
months ended 31
December 2005
(cents)
Headline earnings 9.17 11.252 22.68%
per share for the
six months ended
31 December 2005
(cents)
Net asset value 17.30 17.303 -
per share at 31
December 2005
(cents)
Net tangible 16.25 16.253 -
asset value per
share at 31
December 2005
(cents)
Weighted average 218 210 680 218 210 680 -
shares in issue
for the period
Shares in issue 218 210 680 218 210 680 -
at the end of the
period
Notes:
1. The figures in this column are extracted from the audited interim
results of the company for the six months ended 31 December 2005 as
published on SENS on 27 March 2006 ("IFA published results"). The
figures have been adjusted as it was assumed that the reverse take-
over of Moribo Leisure Limited by IFA had been in effect for the six
months ended 31 December 2005.
2. For purposes of the earnings and headline earnings per share it was
assumed that the acquisition had been in effect for the 6 months ended
31 December 2005. The earnings and headline earnings per share
presented were compiled from the figures in the previous column and
from IFA"s share of the profit of Boschendal and Purple Plum for the
year ending 30 June 2007 ("Boschendal profit"). The Boschendal profit
has been prepared from estimates furnished to IFA by Boschendal
management and were based on the assumption that all the necessary
regulatory, town planning and zoning approvals are obtained within the
anticipated timeframe. The Boschendal profit was divided by two to
make it comparable with the IFA published results for the six months
ended 31 December 2005. It was assumed that interest would have been
payable on the purchase consideration of R53 902 788 at the prime
interest rate of 11% per annum.
3. For purposes of net asset value and net tangible asset value per share
it was assumed that the acquisition had been implemented on 31
December 2005. The net asset value and net tangible asset value per
share presented were compiled from the figures in the previous column
and investments in Boschendal and Purple Plum were created with a
corresponding liability amounting to R53 902 788.
5. Extension of cautionary announcement
Shareholders are advised that the company is continuing with negotiations
with third parties on a separate matter which, if successfully concluded,
may have a material effect on the price of the company"s shares.
Accordingly, shareholders are advised to continue to exercise caution when
dealing in the company"s shares until a full announcement is made.
20 June 2006
Zimbali
Sponsor to the company
BDO QuestCo (Pty) Ltd
Date: 20/06/2006 09:35:29 AM Produced by the JSE SENS Department
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