10 April 2006

JSE-listed Paramount Property Fund has announced details of a significant Black Economic Empowerment deal with listed Mvelaphanda Group Limited. The agreement will involve the issue of a new category of shares to a new company owned 75% by Mvelaphanda and 25% by a broad-based BEE partner. The new BEE vehicle will hold 26% interest in Paramount and the right to convert these new shares into Paramount linked units in three tranches at predetermined prices. The new BEE vehicle will also be invited to nominate three directors to the Paramount Board.

Commenting on the deal, Rodney Squire-Howe, Paramount’s Managing Director says,

"We are delighted with the transaction which will not only put Paramount at the forefront of property empowerment but will also bring Mvelaphanda’s proven skills and abilities into our business. Paramount has been conscious of the need to proactively participate in the economic revolution of our country and has therefore embraced this deal as we believe it will benefit both parties. The agreement between Mvelaphanda and Paramount has been a challenging and exciting process with both parties committed to the enhancement of shareholder value.”

“Under the charismatic leadership of Tokyo Sexwale, Mvelaphanda is one of the most successful black empowerment groups in South Africa and we are confident that they will contribute positively to Paramount’s business.”

Squire-Howe added that the announcement was in line with the terms of the newly signed Property Charter which sets out the agreed targets for BEE compliance. 

Paramount has a quality portfolio of properties situated in the major metropolitan areas of South Africa, but with a largely Cape focus at present. The portfolio is currently valued at around R2.2 billion and the board has indicated it will work towards an 8% increase in distributions for the financial year ending 31st October 2006.

Yolanda Cuba, Deputy CEO of Mvelaphanda Group, said “The investment in Paramount will increase Mvelaphanda Group’s exposure to the property and property related sectors.  In Paramount we are investing in a business that has proven itself, and which we hope to be able to grow further in future.”

ENDS

For further information please contact:

Rodney Squire-Howe

Managing Director

Paramount Property Fund                  

Tel: 021-659 5945                                 

Fred Jenkings

Financial Director

Paramount Property Fund

Tel: 021-659 5966

Brett Till

Chief Financial Officer

Mvelaphanda Group

Tel: 011-290 4200