Acucap Properties Limited. Growthpoint Properties Limited. Approved as a REIT by the JSE. Approved as a REIT by the JSE

Transcription

1 Acucap Properties Limited Approved as a REIT by the JSE (Incorporated in the Republic of South Africa) (Registration number 2001/021725/06) Growthpoint Properties Limited Approved as a REIT by the JSE (Incorporated in the Republic of South Africa) (Registration number 1987/004988/06) Share code: ACP ISIN: ZAE Share code: GRT ISIN ZAE ( Acucap ) ( Growthpoint ) JOINT DETAILED TERMS ANNOUNCEMENT REGARDING A POTENTIAL OFFER BY GROWTHPOINT PROPERTIES LIMITED ( Growthpoint ) TO ACQUIRE ALL THE SHARES IN ACUCAP PROPERTIES LIMITED ( Acucap ) THAT IT DOES NOT ALREADY OWN BY WAY OF A SCHEME OF ARRANGEMENT ( Potential Offer ) 1. INTRODUCTION 1.1. Between 9 and 11 April 2014, Growthpoint acquired 34.9% of the issued linked units in Acucap ( Acucap Linked Unit ) and 31.5% of the issued participatory interests in Sycom Property Fund ( Sycom units ) from certain institutional holders (the Pre-acquisition Vendors ), for a purchase consideration equivalent to 1.9 (one point nine) Growthpoint ordinary shares of no par value ( Growthpoint shares ) for every Acucap Linked Unit acquired and (one point one zero two) Growthpoint shares for every Sycom unit acquired ( Pre-acquisitions ) and advised Growthpoint shareholders that the resultant indirect exposure to Acucap and Sycom s combined R17.7 billion property portfolio achieved by the Pre-acquisitions was considered to be complementary and enhancing to the underlying quality of Growthpoint s own portfolio Subsequent to the Pre-acquisitions and following engagement between Growthpoint and Acucap, joint cautionary announcements were released by Acucap and Growthpoint on the Stock Exchange News Service ( SENS ) on 27 August 2014 and renewed on 9 October 2014 in which shareholders of Acucap and Growthpoint (collectively, the Companies or the Parties ) were advised that the Companies were engaged in discussions which if concluded may have a material effect on the price at which the shares of the Companies trade The boards of each of Acucap and Growthpoint are now pleased to announce that the Parties have reached agreement on Wednesday, 12 November 2014 (the Implementation Agreement ) regarding the terms and conditions of the Potential Offer The Implementation Agreement sets out the basis on which, subject to fulfilment of the conditions as set out below, the Potential Offer will be implemented by way of a scheme of arrangement (the Scheme ) involving a share exchange between Acucap shareholders and Growthpoint, at an exchange ratio of 1.97 (one point nine seven) Growthpoint shares per Acucap ordinary share of no par value ( Acucap share ) held by Acucap shareholders on the Scheme record date ( Scheme Consideration ) The Implementation Agreement regulates the proposal and implementation of the Scheme, and includes, inter alia: the pre-conditions (which pre-conditions are referred to in paragraph 6 below) (the Pre- Conditions ) to the Potential Offer becoming a firm intention to make an offer ( Firm Intention ) as contemplated in Chapter 5 of the Companies Act, 2008 (the Companies Act ) and Chapter 5 of the Companies Regulations, 2011 (the Companies Regulations ) and the independent board of directors, comprising only independent nonexecutive directors of Acucap (the Independent Board"), convened for the purpose of considering the terms of the Potential Offer, proposing the Scheme;

2 the conditions precedent to the Scheme (which conditions are referred to in paragraph 7 below) (the Scheme Conditions ), if the Potential Offer becomes a Firm Intention upon the fulfilment of the Pre-Conditions; warranties and undertakings between Growthpoint and Acucap in relation to the implementation of the Scheme, including the proposal of the Scheme and the conduct by each of the Parties of its business up until the implementation date of the Scheme; the payment, in certain prescribed circumstances, by Growthpoint to Acucap of a break fee to enable Acucap to recover the actual costs incurred or to be incurred by it pursuant to the Potential Offer, of up to a maximum of R10 million plus value added tax in the event of the Potential Offer or Scheme failing on account of any action taken by Growthpoint or its shareholders. The break fee will be limited to 50% of actual costs limited up to a maximum amount of R5 million plus value added tax in the event of the Potential Offer or Scheme failing under certain other circumstances. (The break fee does not exceed 1% of the value of the Scheme Consideration, as prescribed by the Takeover Regulation Panel ( TRP )); and an indicative timeline for implementation of the Scheme, as set out in paragraph 10 below The Scheme Consideration equates to approximately: R48.07 per Acucap share, calculated based on the 30 day clean volume weighted average share price ( VWAP ) of Growthpoint shares on the JSE Limited ( JSE ) on 27 August 2014, being the date of publication of the first cautionary announcement, representing a premium of 9% to the Acucap VWAP over the same period; R45.66 per Acucap share, calculated based on the VWAP of Growthpoint shares on the JSE on 8 April 2014, being the day preceding the Pre-acquisitions, representing a premium of 19.7% to the Acucap VWAP over the same period; and R49.17 per Acucap share, calculated based on the VWAP of Growthpoint shares on the JSE on 11 November 2014, being the date immediately preceding the date of publication of this announcement, representing a premium of 8% to the Acucap VWAP over the same period Shareholders are advised that until satisfaction of the Pre-Conditions, this announcement does not constitute a firm intention announcement in terms of Regulation 101 of the Companies Regulations (a Firm Intention Announcement ). Upon the Pre-Conditions being fulfilled, the Implementation Agreement will constitute notification of a Firm Intention by Growthpoint to make an offer to the Acucap shareholders. In confirmation of the fulfilment of the Pre-Conditions, a Firm Intention Announcement will be made, in compliance with the Companies Act and the Companies Regulations. 2. RATIONALE FOR THE SCHEME The combination of Growthpoint and Acucap (as enlarged by Sycom) is expected to deliver the following benefits: 2.1. to Acucap shareholders: an immediate capital price uplift and potential for further capital appreciation should Growthpoint s share price re-rate positively as a result of this transaction; a greater spread of assets and significantly reduced concentration risk; a more diversified sectoral spread; entry into a much larger fund with substantially higher market capitalisation and greater liquidity; access to a good quality foreign asset base and rand hedge through Growthpoint s shareholding in Growthpoint Properties Australia Limited; and a meaningful exposure to a unique, high quality and iconic asset through Growthpoint s 50% stake in Cape Town s Victoria & Alfred Waterfront. 2.2 to Growthpoint shareholders:

3 2.2.1 a unique opportunity for Growthpoint to increase the size of its South African property portfolio to just over R72 billion, defensively growing its property portfolio through the acquisition of complementary and quality enhancing assets; access to a large, high quality retail portfolio in a single transaction that would meaningfully increase the retail weighting of the fund to levels preceding the acquisitions of the primarily office portfolios of the Tiber Group and Abseq Properties Proprietary Limited during the 2014 financial year and complement the high quality of its retail portfolio; take-on of an experienced asset management team that will deepen the skill sets within Growthpoint; and operational synergies and cost savings on the combined Growthpoint/Acucap/Sycom portfolio. 3. MECHANICS OF THE POTENTIAL OFFER 3.1. The Potential Offer will constitute an affected transaction as defined in section 117(c) of the Companies Act and will be regulated by the Companies Act and the Companies Regulations Subject to fulfilment of the Pre-Conditions, the Potential Offer will be implemented by way of the Scheme and will be proposed by the Independent Board between Acucap and its shareholders (other than Growthpoint) The Scheme will further be subject to the Scheme Conditions. 4. POTENTIAL OFFER TERMS The Potential Offer will be made on the basis that 4.1. should the Scheme become effective, Growthpoint will acquire all Acucap shares not already held by Growthpoint ( Scheme Shares ), (being 157,526,817 Acucap shares as at the date of this announcement); 4.2. the Scheme will become effective with effect from the first calendar day of the calendar month immediately following the calendar month in which the last of the Scheme Conditions is fulfilled (or, if applicable, waived) (the Effective Date ); 4.3. the Scheme Shares will be acquired by Growthpoint with the entitlement to all economic risk and benefit attaching thereto, with effect from the Effective Date of the Scheme; 4.4. the Scheme Consideration will entitle holders of the Scheme Shares to all economic risk and benefit attaching to the Scheme Consideration, with effect from the Effective Date; 4.5. the implementation date of the Scheme will be determined with reference to the Effective Date. Should the Effective Date be on or before 1 March 2015, the implementation date will be 30 March Should the Effective Date be on or after 1 April 2015, the implementation date will be the first Monday (or closest business day thereto) following the last Friday of the month in which the Effective Date falls (collectively Implementation Date ); 4.6. on the Implementation Date, Acucap shareholders (other than Growthpoint) holding Acucap shares on the Implementation Date record date will receive the Scheme Consideration of 1.97 (one point nine seven) Growthpoint shares for every 1 (one) Acucap share held on the Implementation Date record date, rounded to the nearest whole number and credited as fully paid, which based on the number of Acucap shares in issue as at the date of this announcement will amount in aggregate to 310,327,829 Growthpoint shares (to be issued on a pari passu basis with all Growthpoint shares currently in issue and listed on the main board of the JSE under share code GRT); 4.7. there will be no cash alternative;

4 4.8. as further consideration for the Pre-acquisitions as agreed with the Pre-acquisition Vendors at the time of the Pre-acquisition, if the Scheme is implemented (and in relation to the Acucap Linked Units and the Sycom units acquired in terms of the Pre-acquisitions only), Growthpoint will issue 7,042,231 additional Growthpoint shares to the Pre-acquisition Vendors (the Pre-Acquisition Agterskot ) in compensation for the difference between the original Pre-acquisition consideration paid and the Scheme Consideration; 4.9. pursuant to the implementation of the Scheme, Acucap will become a wholly-owned subsidiary of Growthpoint, its listing on the JSE will be terminated and Growthpoint will indirectly own 100% of the shares in Sycom Property Fund Managers Limited, the statutory fund manager of Sycom and, directly or indirectly, approximately 99% of the Sycom units; the Parties will declare their respective interim period dividends for the interim financial periods ended/ending 30 September 2014 (in respect of Acucap) and 31 December 2014 (in respect of Growthpoint), which dividends are anticipated to become payable on or about 8 December 2014 and 30 March 2015 respectively should the Effective Date fall on or before 1 March 2015: Acucap will declare a special dividend for the period commencing on 1 October 2014 and ending on the last day of the calendar month immediately preceding the Effective Date. The special dividend will become payable on the Implementation Date to Acucap shareholders recorded in the securities register of Acucap on the Implementation Date record date; and Growthpoint will declare a special dividend for the period commencing on 1 January 2015 and ending on the last day of the calendar month immediately preceding the Effective Date. The special dividend will become payable on the Implementation Date to Growthpoint shareholders recorded in the securities register of Growthpoint on the Implementation Date record date; should the Effective Date fall on or after 1 April 2015: Acucap will declare its dividend for the 6 month period ended 31 March 2015 ( Acucap Ordinary Dividend ) which will be payable on the earlier of the Implementation Date or Monday, 29 June 2015; and Acucap will declare a special dividend for the period commencing on 1 April 2015 and ending on the last day of the calendar month immediately preceding the Effective Date ( Acucap Special Dividend ), which will become payable on the Implementation Date to Acucap shareholders recorded in the securities register of Acucap on the Implementation Date record date; and Growthpoint will declare a special dividend for the period commencing on 1 January 2015 and ending on the last day of the calendar month immediately preceding the Effective Date. The special dividend will become payable on the Implementation Date to Growthpoint shareholders recorded in the securities register of Growthpoint on the Implementation Date record date. 5. INDEPENDENT BOARD, OPINION AND RECOMMENDATIONS 5.1. In accordance with the Companies Regulations, the Independent Board has been appointed by the Acucap board to evaluate the terms of the Scheme The Independent Board has appointed FirstRand Bank Limited, acting through RMB Corporate Finance, as the independent expert ( Independent Expert ) to provide the Independent Board with external advice in regard to the terms of the Scheme and, make appropriate recommendations to the Independent Board and in particular, to provide an opinion as to the fairness and reasonableness of the Potential Offer, pursuant to the provisions of section 114(3) of the Companies Act ( Independent Expert's Opinion"). Subject

5 to fulfilment of the Pre-Conditions, the substance of the external advice of the Independent Expert and the opinion of the Independent Board regarding the terms of the Scheme will be detailed in the circular which will be posted to Acucap shareholders in order to convene a general meeting to seek approval for the Scheme ( Scheme Circular ). 6. PRE-CONDITIONS TO THE POTENTIAL OFFER AND NOTICE OF FIRM INTENTION TO MAKE AN OFFER 6.1. On fulfilment of the following Pre-Conditions, the Acucap Board will propose the Scheme to Acucap shareholders (other than Growthpoint) and the Implementation Agreement between Acucap and Growthpoint will automatically be deemed to constitute notification by Growthpoint of its firm intention to make an offer to Acucap shareholders, namely that: 6.2. the Independent Expert delivers the Independent Expert s opinion to the Acucap Board in terms of which it concludes that the terms of the Scheme, including the Scheme Consideration, are fair and reasonable for Acucap shareholders (other than Growthpoint); and 6.3. Growthpoint obtains the requisite shareholder approval placing sufficient Growthpoint shares under the control of the Growthpoint directors for the purpose of settling the Scheme Consideration and the Pre-acquisition Agterskot. 7. CONDITIONS PRECEDENT TO THE SCHEME (the Scheme Conditions ) The Scheme will be subject to the fulfilment (or, where applicable, waiver) of the following conditions precedent on or before 30 June 2015 (or such later date as agreed in writing between the Parties) 7.1. that the Scheme is approved by the requisite majority of Acucap shareholders, as contemplated in section 115(2)(a) of the Companies Act, and, to the extent required, by a High Court in terms of section 115(2)(c) of the Companies Act; 7.2. following the approval of the Scheme by Acucap shareholders, appraisal rights representing, in aggregate, not more than 5% of all Scheme Shares eligible to vote at the general meeting to approve the Scheme ("Scheme Meeting") are exercised pursuant to section 164 of the Companies Act within the prescribed time periods contemplated therein ( Appraisal Rights )provided that Growthpoint may in its discretion waive this condition; and 7.3. the requisite approval of the JSE, the TRP, the Competition Tribunal and any other relevant regulatory authorities (either unconditionally or in the case of the Competition Tribunal in the case of retail assets, subject to conditions acceptable to Growthpoint) be obtained. 8. ACUCAP S SUSPENSION AND TERMINATION OF LISTING Application will be made to the JSE, subject to the Scheme becoming unconditional in accordance with its terms, for the suspension and termination of the listing on the JSE of the Acucap shares. 9. SHAREHOLDINGS IN ACUCAP AND ACTING AS PRINCIPAL 9.1. Currently Growthpoint holds 83,475,367 shares in Acucap, which constitutes 34.6% of Acucap s issued share capital Growthpoint confirms that it is the ultimate prospective purchaser of the Scheme Shares and is acting alone and not in concert with any party. 10. FURTHER DOCUMENTATION AND SALIENT DATES 10.1 Further details of the Scheme will be included in the Scheme Circular that will, subject to the fulfilment of the Pre-Conditions, be posted to Acucap shareholders and made available on the

6 Acucap website in due course. The Scheme Circular will also contain, inter alia, a notice of the Scheme Meeting, a form of proxy and a form of surrender and transfer The Scheme will become effective on the first calendar day of the month immediately following the calendar month during which the last of the Scheme Conditions is fulfilled (or, if applicable waived) (the Fulfilment Date ) The final salient dates in relation to the Scheme will be published in due course. However, the Parties have agreed the following indicative timeline: Fulfilment of the last of the Pre-Conditions Thursday, 11 December Posting of Scheme Document On or before Thursday, 15 January 2015 Scheme Meeting On or before Monday, 16 February 2015 Fulfilment Date Tuesday, 17 February 2015 Effective Date Sunday, 1 March 2015 Implementation Date record date Friday, 27 March 2015 Implementation Date Monday, 30 March 2015 Delisting of Acucap from the JSE Monday, 30 March INDEPENDENT BOARD RESPONSIBILITY STATEMENT The Independent Board accepts responsibility for the information contained in this announcement which relates to Acucap in connection with the Scheme and confirms that, to the best of its knowledge and belief, such information is true and the announcement does not omit anything likely to affect the importance of such information. 12. GROWTHPOINT BOARD RESPONSIBILITY STATEMENT The board of directors of Growthpoint accepts responsibility for the information contained in this announcement which relates to Growthpoint in connection with the Scheme and confirms that, to the best of its knowledge and belief, such information is true and the announcement does not omit anything likely to affect the importance of such information. 13. RENEWAL OF CAUTIONARY ANNOUNCEMENTS Acucap and Growthpoint shareholders are cautioned that there is no certainty at this stage that the Pre-Conditions will be fulfilled and that the Potential Offer will be made or that the Scheme will be either proposed or implemented. The Potential Offer or the Pre-Conditions or either of them not being fulfilled may have a material effect on the price of the Companies securities. Accordingly, shareholders are advised to continue exercising caution when dealing in the securities of Acucap or Growthpoint until a further announcement is made. 14. CATEGORISATION OF THE POTENTIAL OFFER FOR GROWTHPOINT In terms of the Listings Requirements of the JSE, the Potential Offer is a category 2 transaction for Growthpoint under section 9 of the JSE Listings Requirements and as such, other than in

7 terms of paragraph 15 below, Growthpoint shareholder approval in not required for the implementation of the Potential Offer. 15. NOTICE OF POSTING OF CIRCULAR TO PLACE GROWTHPOINT SHARES UNDER THE CONTROL OF THE GROWTHPOINT DIRECTORS In order for Growthpoint to pursue the implementation of the Potential Offer, Growthpoint shareholders are required to place a sufficient number of Growthpoint shares under the control of the Growthpoint directors to be issued pursuant to its settling any consideration payable (including the Pre-acquisition Agterskot) in terms of the Potential Offer. Growthpoint shareholders are accordingly notified that a circular to place Growthpoint shares under the control of the Growthpoint directors has been sent to Growthpoint shareholders today, 12 November November 2014 Sandton CORPORATE ADVISOR AND SPONSOR TO ACUCAP QUESTCO LEGAL ADVISOR TO ACUCAP CLIFFE DEKKER HOFMEYR COMPETITION LAW ADVISOR TO ACUCAP BAKER MCKENZIE INDEPENDENT EXPERT TO THE ACUCAP INDEPENDENT BOARD FIRSTRAND BANK LIMITED, ACTING THROUGH RMB CORPORATE FINANCE CORPORATE ADVISOR AND SPONSOR TO GROWTHPOINT INVESTEC LEGAL AND COMPETITION LAW ADVISOR TO GROWTHPOINT GLYN MARAIS INC