Rebosis gets shareholder support for R4.93bn acquisitions

LISTED property fund Rebosis obtained overwhelming shareholder support to acquire the Forest Hill City mall in Centurion and Baywest Mall in Port Elizabeth and the services companies from property developer Billion Group for a total of R4.93 billion.

The terms of the original transaction were amended in July, following concern by some investors about the dilution of earnings growth because of the transaction and that some of the assets to be acquired were overpriced.

Rebosis yesterday said that shareholders approved all the resolution for the transaction by an 87.6 percent majority. Rebosis shares rose 1.15 percent on the JSE yesterday to close at R11.48.

Billion Group is owned by Rebosis founder and chief executive Sisa Ngebulana and constituted a related party transaction in terms of JSE listings requirements.

This meant the transaction required a minimum of 75 percent approval from shareholders.

The proposed acquisitions will grow Rebosis’ total assets under management to about R18bn from R9.8bn at end-February this year and its initial portfolio of R3.3bn when the company listed on the JSE in May 2011.

The amendments to the original transaction resulted in the acquisition of a 50.1 percent interest BT Ngebs City shopping centre in Mthatha in the Eastern Cape being excluded from the proposed transaction.

The consideration for the 72 811m² Forest Hill City was also reduced by R120m to R2.09bn, that for the 89 989m² Baywest Mall reduced by R60m to R2.2bn and for Billion Property Services reduced by R20m to R229m.

Kameel Keshav, the chief financial officer of Rebosis, who spearheaded the transaction on behalf of Rebosis, said yesterday that they were very excited and also humbled by the overwhelming confidence Rebosis shareholders showed in the transaction.

The acquisition allowed Rebosis to acquire scarce, high quality income generating retail assets and would bolster the company’s retail exposure to 72 percent of the portfolio post the transaction. “Adding Baywest Mall and Forest Hill City to our portfolio enhances our overall defensive characteristics improving our average weighted lease terms and underpinning our above average yield,” he said.

The total transaction amount is R4.934bn, of which up to about R3.7bn would be funded by debt, and the balance paid in cash, funded through a series of a claw back offers that will be underwritten by Billion, 50 percent Baywest Mall owner Abacus and Nedbank.