New merger plans spur consolidation of property sector

By Roy Cokayne

THE CONSOLIDATION of the listed property sector has been given added impetus by listed Acucap and Growthpoint jointly announcing plans to merge.

The two companies said yesterday they had concluded an implementation agreement for the terms and conditions of a potential offer by Growthpoint to acquire all the shares in Acucap that Growthpoint did not already own.

This follows Acucap and Growthpoint in August advising the market they were engaged in discussions.

Vukile earlier this month reported it had acquired a further stake in Synergy to increase its holding in the fund to 39.965 percent, which meant Vukile had to make a mandatory offer to acquire all the remaining linked units in Synergy it did not already own.

Redefine acquired Annuity Properties effective from March this year and has a 65.9 percent equity interest in Fountainhead Property Trust and previously indicated it intended to eventually acquire all the shares in Fountainhead it did not own.

Redefine in September also acquired a 13.7 percent stake in Emira but stressed Emira was undervalued and was not a take-over target for Redefine.

Growthpoint in April this year secured pre-acquisition interests of 34.7 percent of Acucap and 15.6 percent of Sycom. Acucap currently holds 83.4 percent of Sycom and 100 percent of Sycom Property Fund Managers.

The preconditions in the implementation agreement, if met, will progress Growthpoint’s potential offer to a scheme of arrangement that would result in Acucap becoming a wholly owned subsidiary of Growthpoint and Growthpoint owning Sycom Property Fund Managers and directly or indirectly about 99 percent of the Sycom units in issue.

Norbert Sasse, the chief executive of Growthpoint, said yesterday they were pleased to have finalised the implementation agreement with Acucap and to move forward together with a clear road map.

The scheme of arrangement proposes a share exchange of 1.97 Growthpoint shares for one Acucap share.

This equates to about R49.17 an Acucap share, which represents a premium of 8 percent on the Acucap 30-day clean volume weighted average share price on November 11.

If the scheme is implemented, Growthpoint will also match this share exchange rate with the vendors of the pre-acquisition interests it already holds in Acucap and Sycom.

Growthpoint has advised it will post a circular to its shareholders in the next few days regarding placing the requisite shares under the control of the directors.

The requisite majority of Acucap shareholders must approve the scheme at a general meeting. Approvals will also be required from the JSE, the Takeover Regulation Panel, the Competition Tribunal and any other relevant regulatory authorities.

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