Richway dispose to Primegro

Posted On Friday, 21 September 2001 03:01 Published by eProp Commercial Property News
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RICHWAY Retail, the property management subsidiary of retail specialist Vestacor, has sold assets worth R1,07bn to Primegro, Richway's CEO Peter Blanckenberg said yesterday.

Property-Housing-ResidentialHe was happy with the price received for the retail properties as Richway's share price had been trading at a discount to its net asset value, he said.
Total assets were valued at R869,19m for the year ending June.
Richway's initial goal was to build a retail property portfolio valued at R2bn with the focus on A-grade regional shopping centres.
Richway's inability to acquire Canal Walk prevented this from happening and 'called for creative thinking by directors to ensure the realisation of Richway's ambitions', Blanckenberg said.
'When the opportunity came to sell the portfolio to Primegro it represented a winning solution for both parties.'
Blanckenberg said that the R1,107bn raised by the disposal was made up of R952m in cash and R155m in Primegrolinked shares. Richway shareholders would be advised of the mechanism through which they would receive the purchase consideration.
Richway was considering liquidating itself now that most of its key assets had been sold, Blanckenberg said.
Vestacor CEO Bruce Rubenstein confirmed that Vestacor and the consortium that included BoE was considering liquidating Richway.
Vestacor and the consortium held 77% of Richway.
'It has taken two years to build up a property portfolio that would be attractive to institutional investors,' he said.
Vestacor specialised in the acquisition, turnaround and repositioning of undervalued firms in the retail sector.
When Vestacor created Richway Rubenstein said the group had taken a view that yields in the property retail market would improve and that interest rates would be low once it had created a large enough property portfolio.
'The returns Vestacor is about to receive proves Vestacor made the right choice at the time.'

Last modified on Saturday, 26 April 2014 09:45

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