Redefine acquisition of Fountainhead gets the go-ahead

Posted On Monday, 07 July 2014 09:54 Published by
Rate this item
(0 votes)

Fountainhead Property Trust has agreed to sell to Redefine Properties all of its assets, including the Fountainhead property portfolio, in exchange for 82 Redefine shares for every 100 Fountainhead units held.

Marc Wainer

As part of the transaction Redefine will assume all of Fountainhead's liabilities, including its interest-bearing debt. The transaction will be effective from 1 September 2014.

Details of the transaction were announced today in a joint statement by Redefine and Fountainhead, which is managed by Fountainhead Property Trust Managers Limited (FPTML). Redefine's board and the independent board committee of FPTML have agreed that a merger of Redefine and Fountainhead makes strategic sense.

Marc Wainer, CEO of Redefine comments, "We welcome this agreement and are pleased to be taking this transaction forward."

Redefine is the largest unitholder in Fountainhead, at 65,9%. It is also the owner of FPTML, the asset manager which controls the assets of Fountainhead.

The transaction is subject to the fulfilment of the usual conditions precedent including approvals from Fountainhead unitholders, the Financial Services Board and Redefine shareholders.

FPTML's independent committee has endorsed the transaction and has recommended that Fountainhead unitholders, excluding Redefine which is a related party, do the same.

For Fountainhead investors, the transaction will provide exposure to a diverse portfolio of property assets valued at R44.5 billion with a focussed portfolio strategy, access to lower costs of capital and the benefits of economies of scale and cost savings thanks to synergies between both property portfolios. It will also unlock greater ease of trade through the more liquid Redefine shares.

For Redefine shareholders, the transaction means strategic portfolio growth and diversification through the added benefit of increased exposure to retail property. The Fountainhead property portfolio valued at over R12 billion comprises 66 properties covering 935,355 sqm of lettable space and is concentrated in retail properties, which represent just over 70% of the property portfolio by value.

Once the transaction is finalised, Fountainhead will be delisted from the JSE. Fountainhead's unitholders will receive the final distribution for the six-months ending 31 August 2014. Their first distribution as Redefine shareholders will be for the six months ending 28 February 2015.

"For Redefine, this is another important milestone in expanding the local property portfolio and in aligning the interests of investors," adds Wainer.

Most Popular

Tshwane Regional Mall Grand Opening date set

Aug 31, 2019
24th October 2019, the long-awaited day earmarked for the grand opening of Tshwane…

Attacq Ltd and Tricolt break ground on Ellipse Waterfall

Aug 30, 2019
 13 2
Today Attacq Ltd the JSE listed REIT developing Waterfall City, and Waterfall Logistics…

Eris Property Group appoints successive CEO Barend de Loor

Aug 30, 2019
Eris Property Group has appointed a new Chief Executive Officer (CEO). Barend de Loor…

Redefine Properties appoints Daisy Naidoo as independent non-executive director

Aug 30, 2019
Redefine Properties appoints Daisy Naidoo as independent non-executive director.

Founder Marc Wainer retires from Redefine Properties

Aug 31, 2019
JSE listed diversified real estate investment trust Redefine Properties today announced…

Please publish modules in offcanvas position.