| Thu 14 Dec 2006, 17:00 | | ABT - Ambit - Acquisition Of Portion Of The Naviga |
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ABT
ABT
ABT - Ambit - Acquisition Of Portion Of The Navigator Property Fund Portfolio
Ambit Properties Limited
(Registration number: 2001/007003/06)
Share code: ABT
ISIN code: ZAE000051645
("Ambit" or "the Company")
ACQUISITION OF PORTION OF THE NAVIGATOR PROPERTY FUND PORTFOLIO
Introduction
Linked unit holders are referred to the cautionary announcement dated 2 November
2006 and are advised that Ambit has entered into an agreement with Rowmoor
Investments and Masande Real Estate ("Sellers") on 11 December 2006 to acquire a
part of the Navigator Property Fund Portfolio, a subsidiary of the Catalyst
Group, for a total purchase price of R136 million plus acquisition costs of
R1,75 million ("the acquisition). The effective date of the acquisition is the
date of transfer of the respective properties into the name of Ambit, which is
expected to be in February 2007.
Details of the Portfolio
The Portfolio consists of seven properties, of which one is a retail property,
three are industrial properties and the remaining three commercial properties.
The total gross lettable area ("GLA") of the portfolio amounts to 30 921m2 with
an expected net forward yield of 10.76%. The retail property has a triple-net
lease with Edgars Stores Ltd, expiring in 2013, while the industrial properties
have triple-net leases with Metcash expiring 2012. Two of the commercial
properties are also single tenanted buildings with gross leases, expiring from
2009 to 2014. The remaining building is multi-tenanted with gross leases
expiring from 2008 to 2010. Of these, the lease with the South African Police
Services has not been completed but the tenancy has been confirmed by a duly
authorised letter of intent binding the tenant to the premises. The main
tenants of the commercial properties are Governmental departments being the
South African Police Service and the Departments of Justice, Correctional
Services and Home Affairs.
The salient features of the respective properties are as follows:
Property Location Sector GLA Rental(1 Purchase
m2 ) Price
R R`000
Church Pretoria, CBD Retail 11 65.19 86 000
Street 008
28 Worcester Commercial 3 848 49.57 19 000
Fairbairn
St
Alpha Mitchell`s Commercial 3 478 38.80 9 500
Street Plain, CT
Westport
Park
Cnr New Philippi, CT Commercial 1 357 56.27 7 500
Eisleben,
Landsdowne
Rds
No. 4 11 Welkom Industrial 5 202 9.22 5 300
Street
Voorspoed
East
2 Sussex Potgietersrus Industrial 3 152 13.50 4 700
Rd Ex:6
49 De Wits Brits Industrial 2 876 12.69 4 000
St Ex: 7
Weighted average contractual rental per square metre as at 1st February 2007.
The portfolio has a vacancy in the Mitchell`s Plain property of 468mSquared or
5% of the GLA in respect of the commercial sector, with every likelihood that
this vacancy will be let within 9 months.
Rationale for the acquisition
Ambit`s strategy is to increase its property portfolio to in excess of R1.5
billion and its market capitalisation to in excess of R1 billion during the next
year. There is no change to the strategy of owning quality properties in good
growth nodes.
This acquisition is in line with this strategy and will be yield enhancing for
unit holders in the forecast periods.
Consideration for the acquisition
The consideration for the acquisition of the Portfolio will be settled by way of
an issue of 43 174 603 linked units in Ambit to the Sellers, at an issue price
of 315 cents per linked unit. This price was derived from the 30 day volume
weighted average price to 14 November 2006, being the date of approval of the
transaction by the Directors of Ambit, less a discount of 5%. The seller will
pay Ambit the pro rata forecast half year distribution for the period 1 October
2006 to the date of transfer.
The Portfolio has been valued by Dube and Richardson Property Consultants Pty
(Ltd), independent valuers, at R136.1 million as at 1 December 2006.
Conditions
The acquisition of the Portfolio is subject the approval of the Competition
Commission, and the JSE Limited ("JSE") with regard to the circular and the
listing of the linked units to be issued in terms of this transaction. All
other suspensive conditions have been fulfilled.
Financial information relating to the acquisition
The financial effect of the acquisition on Ambit`s net asset value per linked
unit has not been disclosed as the effects are not significant. Forecast
information in respect of the Portfolio for the 8 months from 1 February 2007 to
30 September 2007 as well as for the 12 months from 1 October 2007 to 31
September 2008 is set out below. The forecast financial information has been
reviewed by Ambit`s auditors in terms of Section 8 of the Listings Requirements
of the JSE.
Property Revenue Operational Revenue Operational
8 net income 12 net income
Months 8 Months months 12 Months
Ending Ending Sept Ending Ending Sept
Sept 07 07 Sept 08 08
R`000 R`000 R`000 R`000
Church Street 5.819 5.746 9.263 9.150
, Pretoria ,
CBD
28 Fairbairn 1.685 1.438 2.713 2.369
Street,
Worcester
Alpha Street 1.045 854 1.873 1.513
Westport
Park,
Mitchell`s
Plain, CT
Cnr New 661 552 1.058 891
Eisleben,
Landsdowne
Rds,
Philippi, CT
No. 4 11 403 393 631 618
Street
Voorspoed
East,Welkom
2 Sussex Rd 358 348 562 548
Ex:6,
Potgietersrus
49 De Wits St 307 296 480 466
Ex: 7, Brits
Notes:
Profit after tax has not been disclosed as it has been assumed that the total
operational income will be distributed to linked unit holders.
All properties with the exception of the Mitchell`s Plain property are fully
let. The vacancy has been budgeted to be let effective 1st October 2007 at a
gross rental of R35/mSquared which is below the current contractual income for
the balance of the building.
Documentation
The acquisition has been classified as a Category 2 transaction in terms of
Section 9 of the Listings Requirements of the JSE. Accordingly the Company is
required to post a circular to linked unit holders in due course.
Johannesburg
14 December 2006
Corporate Adviser Sponsor
Grindrod Bank Exchange Sponsors
Date: 14/12/2006 17:00:01 Produced by the JSE SENS Department.
