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Rebosis Property Fund - A Shares (JSE:REA) News - Disposal of portfolio of office assets and withdrawal of cautionary announcement
REBOSIS PROPERTY FUND LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2010/003468/06)
JSE share code: REA ISIN: ZAE 000240552
JSE share code: REB ISIN: ZAE000201687
(Approved as a REIT by the JSE)
("Rebosis" or "the Company")
DISPOSAL OF PORTFOLIO OF OFFICE ASSETS AND WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT
1. INTRODUCTION AND RATIONALE
1.1. Shareholders are referred to the previous cautionary announcements published by Rebosis, the most
recent of which was released on SENS on 28 September 2021. Rebosis is pleased to announce that it,
together with its wholly-owned subsidiary Ascension Properties Limited ("Ascension") (collectively the
"Rebosis Group"), has concluded agreements (the "Transaction Agreements") with Ulricraft
Proprietary Limited (the "Purchaser"), in terms of which the Purchaser shall acquire from the Rebosis
Group the portfolio of rental enterprises described more fully in paragraph 4 below (the "Sale Portfolio")
as a going concern and for an aggregate cash consideration of R6,319,099,000 (the "Purchase
Consideration") (the "Transaction").
1.2. The Sale Portfolio comprises, inter alia, government and state-tenanted office assets which will be sold
to the Purchaser as going concerns in terms of the Transaction. The Purchaser is an entity established for
the purposes of participating in the Transaction and is a wholly owned subsidiary of Vunani Capital
Partners Limited (“VCP”), a company listed on Equity Express Securities Exchange.
1.3. It must be noted that while VCP is currently the owner of all of the issued share capital of the Purchaser,
upon fulfilment of all conditions precedent as set out in paragraph 3 below, it is expected that VCP will
only own between 6% and 9% of the Purchaser, with the balance being owned by the equity funders as
set out in paragraph 3.2 (ii) below.
1.4. The Transaction is consistent with the Company’s strategy to deleverage and optimise its balance sheet
by reducing its LTV, and, in addition, to realise the value of the office segment of its portfolio, to
restructure the business as a retail focused fund and to position the Company to resume dividend payments
to shareholders.
2. TERMS OF THE TRANSACTION
2.1. In terms of the Transaction, the Rebosis Group will sell the Sale Portfolio to the Purchaser as an
indivisible transaction. The Transaction will involve the sale by (i) Rebosis, of those immovable
properties, and the rental enterprises conducted thereon, contemplated in paragraph 4.1 (the "Rebosis
Sale Portfolio"); and (ii) Ascension, of those immovable properties, and the rental enterprises conducted
thereon, contemplated in paragraph 4.2 (the "Ascension Sale Portfolio"), which sales are inter-
conditional.
2.2. The Transaction is structured as the sale by the Rebosis Group of the Sale Portfolio as a going concern.
2.3. The Purchase Consideration payable by the Purchaser for the Sale Portfolio, being an aggregate
consideration of R6,319,099,000, comprises a consideration of R3,943,681,000 for the Rebosis Sale
Portfolio and R2,375,418,000 for the Ascension Sale Portfolio, and shall be payable by the Purchaser in
cash.
2.4. While the Transaction shall constitute an indivisible sale of the Sale Portfolio, for practical reasons it
may not be possible for registration of the transfer of each asset forming part of the Sale Portfolio (each
a "Sale Enterprise") to be effected simultaneously. The sale of each Sale Enterprise shall take legal and
commercial effect against registration of transfer of such Sale Enterprise in the applicable Deeds
Registries Office ("Transfer").
2.5. Each Sale Enterprise has attributed to it an individual purchase consideration which will be payable by
the Purchaser in cash against registration of Transfer of such Sale Enterprise. To the extent that Transfer
of any Sale Enterprise has not been effected on or before 1 February 2022 (the "Anticipated Transfer
Date"), the individual purchase consideration payable in respect of such Sale Enterprise shall be escalated
at a rate of 6% per annum, calculated and expressed as an effective daily rate with reference to the number
of days elapsed between the Anticipated Transfer Date and the actual date of Transfer of the Sale
Enterprise. Further details will be included in the shareholder circular being prepared in this regard (the
“Circular”).
2.6. Three of the Sale Enterprises (being those known as NBC Building, 373 Pretorius Building and 174
Visagie Street Building, more fully described in paragraph 4) (the "Redevelopment Assets") are in the
process of being converted from office space into purpose-built student accommodation.
2.7. Rebosis Group has provided warranties to and in favour of the Purchaser in respect of the Sale Portfolio
which are typical for a transaction of this nature.
3. CONDITIONS PRECEDENT
In addition to the inter-conditionality of the sale of the Rebosis Sale Portfolio with the Ascension Sale Portfolio,
the Transaction is subject to the fulfilment or (where applicable) waiver of the conditions precedent that:
3.1. the Purchaser confirms in writing to the Rebosis Group that it is satisfied with the outcome of the due
diligence investigation being undertaken by the Purchaser in respect of the Sale Portfolio;
3.2. the Purchaser has satisfied the Rebosis Group, by 15 February 2022 (or by the expiry of an extended
funding period, if applicable), that it has obtained sufficient funding in order to discharge its payment
obligations in terms of the Sale. This condition shall be deemed to have been fulfilled upon (i) in respect
of debt funding, the issuing by a bank or other financial institution concerned of a letter, in form
reasonably acceptable to the Rebosis Group, confirming that a mortgage loan or similar debt facility has
been granted to the Purchaser and/or (ii) in respect of equity funding, written commitment letters from
each such equity funder in terms of which such equity funder has irrevocably committed to make the
applicable equity funding available to the Purchaser on terms that will enable the Purchaser to utilise
such funding to timeously discharge its payment obligations under this Agreement;
3.3. the Purchaser has provided the Rebosis Group with one or more guarantees, in a form and issued by a
bank/s or other financial institution acceptable to the Rebosis Group, for payment of the full Purchase
Consideration in accordance with the Transaction Agreements;
3.4. counterparties to any loan or other financial indebtedness of Rebosis or Ascension (as applicable) have
provided such consents or approvals, in writing, as may be required under the relevant funding
agreements in order for the Transaction to be effected without triggering any event of default or other
potential adverse consequence under such funding agreements;
3.5. the Rebosis Group has obtained the consent of the mortgagees in respect of any mortgage bonds
registered over any of the immovable properties forming part of the Sale Portfolio, in relation to the
implementation of the Transaction and to the cancellation of the mortgage bonds upon Transfer;
3.6. the shareholders of Rebosis have passed such ordinary and/or special resolutions as may be required in
terms of the JSE Listings Requirements in respect of a category 1 transaction and the Companies Act,
No 71 of 2008, if any, in order to implement the Transaction and the provisions of the Transaction
Agreements; and
3.7. the Transaction is approved by the Competition Authorities in terms of the Competition Act, No 89 of
1998, either unconditionally or, in the event of a conditional approval, on terms acceptable to the parties.
4. PROPERTY SPECIFIC AND FINANCIAL INFORMATION
Property specific details of the Sale Portfolio shopping centres, including property name and address, location,
rentable area, weighted average rental per square metre and valuation are set out below. The information below
has been extracted from the interim financial results of the Company for the six months ended 28 February 2021,
which were prepared in terms of International Financial Reporting Standards. The financial information in this
announcement is the responsibility of the directors of Rebosis and has not been reported on or reviewed by a
reporting accountant.
4.1. Rebosis Sale Portfolio:
Property Physical address Rentable Weighted Net operating Valuation (R) *
name area (m2) average income
rental per
square metre
(R/m2)
OFFICE SECTOR
11 Diagonal 11 Diagonal Street, 37 160 134.90 39 215 533 637 659 000
Street Gauteng
Liberty 278 Madiba Street, 33 885 141.79 36 911 562 446 100 000
Building Gauteng
Victoria Hartley Street, Weavind 24 720 119.91 30 425 420 607 690 000
Mxenge Park, Gauteng
124 Main 124 Main street, Gauteng 20 818 116.20 19 421 455 350 710 000
Street
Bank of 400 Paul Kruger Street, 14 599 91.90 11 904 633 185 130 000
Lisbon Gauteng
18 Rissik 18 Rissik Street, Gauteng 11 204 95.00 8 554 110 179 500 000
Street
Arbour Square 82-98 Juta Street, 9 206 72.60 4 162 112 98 200 000
Braamfontein, Gauteng
Revenue 205 Pietermaritz Street, 7 314 91.60 4 010 101 79 520 000
Building Kwa-Zulu Natal
189 Schoeman 189 Schoeman Street, 19 332 143.40 19 889 344 224 100 000
Street Gauteng
28 Harrison 28 Harrison Street, 20 984 113.30 12 822 755 283 900 000
Street Gauteng
64 Eloff Street 64 Eloff Street, Gauteng 4 938 152.90 5 282 263 54 500 000
99 Market 99 Market Street, 11 659 62.30 2 083 425 111 300 000
Street Gauteng
Jabu Ndlovu 270 Jabu Ndlovu Street, 11 455 122.30 7 958 107 132 750 000
Kwa-Zulu Natal
SASSA ** 2460 Dr Makgobo 11 665 2 558.20 1 335 403 147 000 000
Campus Avenue, North West
INDUSTRIAL SECTOR
Antalis John Street, Selby, 18 954 47.00 4 801 683 96 900 000
Gauteng
Total 257 893 208 777 904 3 634 959 000
* the valuations were performed as at 28 February 2021 by CBRE, who is independent from the company and
registered as a professional valuer in terms of the Property Valuers Profession Act, 47 of 2000
** the disclosure with regard to weighted average rental is based on a “per bed” basis and not on a square metre
rate
4.2. Ascension Sale Portfolio:
Property Physical address Rentable Weighted Net Valuation *(R)
name area (m2) average operating
rental per income
square
metre
(R/m2)
OFFICE SECTOR
Game Building 64 Pritchard Street, 21 438 160.10 16 298 788 279 200 000
Gauteng
VWL Building 202 Madiba Street, 17 989 94.50 7 945 555 220 300 000
Gauteng
Prorom 30-35 Brown Street, 6 431 116.26 3 295 369 56 470 000
Mpumalanga
Spectrum 52 Voortrekker Road, 7 550 106.40 4 589 858 98 120 000
Belville, Western Cape
Sigma 9 Blackenberg Street, 3 751 105.80 1 848 074 42 070 000
Building Belville, Western Cape
174 Visagie 174 Visagie Street, 13 537 - - 164 870 000
Street^ Gauteng
238 Roan 238 Roan Crescent, 9 035 84.20 5 228 697 86 100 000
Crescent Gauteng
373 Pretorius 373 Pretorius Street, 13 340 - - 148 930 000
Street^ Gauteng
Kingfisher 10 Kingfisher Drive, 1 405 50.80 712 948 15 700 000
Gauteng
Meyersdal 65 Phillip Engelbrecht 4 957 74.50 1 663 316 54 500 000
Street, Gauteng
Mishumo 77 De Korte Street, 6 154 120.10 4 115 280 69 400 000
House Gauteng
NBC^ 76 Juta Street, Gauteng 10 000 - - 89 900 000
Riverpark Cnr Emtoweni & 4 216 143.60 3 046 913 53 900 000
Cascade Close,
Mpumalanga
Riverview Cnr Emtoweni & 4 303 103.30 2 280 063 52 740 000
Cascade Close,
Mpumalanga
Schriener 94 Pritchard Street, 18 815 83.50 10 639 916 233 600 000
Chambers Gauteng
Surrey House 35 Rissik Street, Gauteng 11 840 98.70 11 217 090 202 500 000
Swiss House 86 Main Street, Gauteng 8 008 137.20 7 952 900 121 400 000
Total 162 769 75 599 243 1 989 700 000
* the valuations were performed as at 28 February 2021 by CBRE, who is independent from the
company and registered as a professional valuer in terms of the Property Valuers Profession Act, 47
of 2000
^ these properties are in the process of being converted to student accommodation and as such, are
vacant currently
5. CATEGORISATION OF TRANSACTION
The Transaction constitutes a category 1 transaction and therefore, in terms of the JSE Listings Requirements,
Rebosis shareholder approval is required. A circular convening a general meeting and providing further
information on the Transaction will be issued to Rebosis shareholders in due course.
6. WITHDRAWAL OF CAUTIONARY
Shareholders are referred to the cautionary announcements in this regard, the most recent of which was released
on 28 September 2021. In light of the information contained in this announcement, the cautionary is withdrawn
and Rebosis shareholders are advised that caution is no longer required to be exercised by shareholders when
dealing in the Company's shares.
21 October 2021
Transaction sponsor
Java Capital
Legal advisor
CDH
Competition Attorney
Vani Chetty Competition Law
Date: 21-10-2021 05:28:00
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