Black players take 25% of Sanlam property arm

Posted On Wednesday, 01 February 2006 02:00 Published by
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A group of black investors including Transport Minister Jeff Radebe's wife Bridgette and new entrants, has bought a 25% stake in Sanlam's property loan stock company, Vukile Property Fund, for R439 million.

Laurence Rapp

The deal, which has been lauded as one without the "usual suspects" except for Bridgette, is an industry first for a property fund of this size. It is expected to stimulate township property growth and attract investors to commercially develop rural communities. It is also significant as Vukile will immediately achieve its five-year equity targets.

The transaction will see Sanlam selling 67,4 million of its Vukile-linked units to black consortium, BEEShareCo, for 640c a unit, reducing its stake in Vukile from 67% to 33%. The deal has been funded through a R140m guarantee from Sanlam and a R439 million loan from Nedbank.

BEEShareCo will be 40%-owned by the Buhlobo consortium, 24% by Sanlam, 12% by a yet-to-be-announced empowerment partner, and 24% by the Participation Trust that will be formed from a broad-based group of black investors.

Buhlobo is headed by South African National Civic Organisation (Sanco) president Mlungisi Hlongwane and comprises five property companies. These include Mashudu Properties Investment (32,5%) led by Bridgette; Sakhisizwe Holdings (31,6%) led by Hlongwane as chairman; Akhona Properties (15,8%) led by CE Noluthando Gosa; Batsalani Properties (15%) headed by Farouk Abrahams; and Panavest Properties (5%), which involves 6,2 million Sanco members, 220000 National Education Health and Allied Workers' Union members, and a group of rural women.

Buhlobo is active in the property market, and Sanlam believes the consortium could play a strategic role in Vukile's operations. Hlongwane said: "As the lead consortium we are currently involved in the property sector and we intend to play a full and active role in the further development of this business, bringing our skills to bear at both an operational and strategic level."

Mashudu Properties has a R70m mining property portfolio. It plans to contribute to the deal through its association with the mining industry, adding value to property surfaces after mining activities have ceased and developing rural communities. Through its members, it aims to facilitate discussions with government regarding property investments and management.

Sakhisizwe Holdings is an investment holding company. Its main vehicle is Colossus Properties.

Akhona Properties is owned and managed by women specialising in property management (commercial, industrial and retail). Batsalani is a niche investor and financial services specialist with a five-year track record. It brings to the table restructuring and capital-raising services and act as an advisor.

Last modified on Thursday, 08 May 2014 15:35

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