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Capital to buy rest of Pangbourne

Posted On Thursday, 25 November 2010 02:00 Published by eProp Commercial Property News
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Capital Property Fund ’s planned acquisition of property loan stock company Pangbourne Properties will result in it becoming the third-largest SA listed property fund.

Kundayi MunzaraListed property unit trust Capital Property Fund ’s planned acquisition of property loan stock company Pangbourne Properties would result in it becoming the third-largest South African listed property fund with a market capitalisation of R14.9 billion.

Growthpoint is SA’s largest listed property group, with a market capitalisation of R24 billion. Redefine is second, at R21 billion.

Capital yesterday announced its intention to acquire all Pangbourne linked units in issue that it does not already hold.

Capital said the benefits of the deal include economies of scale, a market-appropriate gearing level for the combined portfolio and improved liquidity for unitholders.

Capital is offering Pangbourne unitholders Capital units on a ratio of 2.38 Capital units per Pangbourne unit.

Any Pangbourne unitholder that would receive in aggregate 1 190 Capital units or fewer, would have the choice to receive a cash consideration of R20 per Pangbourne linked unit instead.

Investec Property’s head of research, Kundayi Munzara, said the swap ratio implies a 1% premium to the Pangbourne closing price on Wednesday.

He said the deal is likely to be yield-enhancing for Capital unitholders. While the premium is modest, Pangbourne unitholders may benefit from exposure to Capital’s portfolio.

"We expect cost synergies to be minimal … as Pangbourne and Capital directors operate under one roof and they have worked hard to remove cost inefficiencies within the group over the years."

Last modified on Monday, 21 April 2014 13:24

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