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VUKILE PROPERTY FUND LIMITED - Possible disposal of Vukile's interest in Atlantic Leaf Properties Limited
Possible disposal of Vukile's interest in Atlantic Leaf Properties Limited VUKILE PROPERTY FUND LIMITED (Incorporated in the Republic of South Africa) (Registration number 2002/027194/06) JSE share code: VKE NSX share code: VKN ISIN: ZAE000180865 Debt company code: VKEI (Granted REIT status with the JSE) ("Vukile") POSSIBLE DISPOSAL OF VUKILE'S INTEREST IN ATLANTIC LEAF PROPERTIES LIMITED 1. Introduction 1.1. Shareholders are referred to the announcement published on SENS today by Atlantic Leaf Properties Limited ("Atlantic Leaf") (the "FIA") advising that Atlantic Leaf has entered into an implementation agreement with South Downs Investment LP (the "Offeror") and agreed the terms of a recommended cash acquisition (the "Acquisition") pursuant to which, subject to the fulfilment of Acquisition conditions being fulfilled, the Offeror will acquire all the issued shares in Atlantic Leaf ("Atlantic Leaf Shares") for a cash consideration of 80.5 pence per Atlantic Leaf share (as more fully detailed in paragraph 3.3 below) and thereafter the Atlantic Leaf Shares will be delisted from the stock exchanges operated by the JSE Limited ("JSE") and the Stock Exchange of Mauritius Ltd ("SEM") (the "Atlantic Leaf Transaction"). It is proposed that the Atlantic Leaf Transaction will be implemented by way of a scheme of arrangement under the Companies (Law) Jersey, 1991 (the "Scheme"). 1.2. Atlantic Leaf is a Jersey-incorporated UK REIT, with a primary listing on the Main Board of the JSE and a secondary listing on the Official List of the SEM, focussing predominantly on investments in the industrial sector of the UK market. 1.3. Vukile, directly and indirectly, holds in aggregate 65 958 606 shares in the share capital of Atlantic Leaf (constituting 34.9% of Atlantic Leaf's issued share capital) (the "Sale Shares"). 1.4. Vukile shareholders are advised that Vukile has furnished an irrevocable undertaking in favour of the Offeror pursuant to which Vukile has agreed to, inter alia, vote in favour of the Scheme and, subject to the Scheme becoming unconditional in accordance with its terms, to sell the Sale Shares to the Offeror on the terms and conditions of the Scheme (as fully detailed in the FIA) (the "Proposed Transaction"). 2. Rationale The Proposed Transaction is in line with Vukile's stated strategy of exiting its non-core investments. The proceeds from the Proposed Transaction will provide further strength and optionality to the Vukile balance sheet. 3. Salient terms of the Proposed Transaction 3.1. The sale by Vukile of the Sale Shares will be effected pursuant to the implementation of the Scheme and on the same terms upon which all Atlantic Leaf shareholders will dispose of their Atlantic Leaf shares if the Scheme is approved, becomes unconditional and is implemented in accordance with its terms. 3.2. Details of the salient terms and conditions of the Scheme are set out in the FIA. 3.3. As consideration for the Acquisition of an Atlantic Leaf Share ("Scheme Share") pursuant to the Scheme, the Offeror will offer Scheme Shareholders, in respect of their Scheme Shares a cash consideration of 80.5 pence per Scheme Share, less the aggregate amount of any distribution per Atlantic Leaf share that is declared by Atlantic Leaf post 22 May 2020 and prior to the effective date of the Scheme, which effective date is anticipated to be on or about 4 August 2020 ("Effective Date"), (the "Scheme Consideration"). In addition to the Scheme Consideration Vukile will on Monday, 25 May 2020 receive payment of the 4.5 pence per Atlantic Leaf share declared by Atlantic Leaf on 28 April 2020 (the "May 2020 Distribution"). Atlantic Leaf has advised that it does not anticipate declaring or paying further distributions prior to the Effective Date. 3.4. Accordingly, the aggregate proceeds that Vukile would receive in respect of its Sale Shares on implementation of the Scheme (excluding the May 2020 Distribution in an aggregate amount of GBP 2 968 137.27 that is to be paid to Vukile on 25 May 2020) will be GBP 53 096 677.83. The anticipated date by which the Scheme Consideration will be paid is 17 August 2020. 3.5. The Proposed Transaction remains subject to the Scheme being proposed, becoming unconditional and being implemented in accordance with its terms. 4. Financial Information 4.1. As at 30 September 2019, the book value of the Sale Shares (which is also the net asset value of the Sale Shares) as per Vukile's unaudited condensed consolidated interim results for the 6 months ended 30 September 2019 was c. R1.25 billion. 4.2. The profit attributable to the Sale Shares as per Vukile's unaudited condensed consolidated interim results for the 6 months ended 30 September 2019 was c. R41 million. 4.3. The above financial information has been extracted from Vukile's unaudited condensed consolidated interim results for the 6 months ended 30 September 2019 which were prepared in terms of Vukile's accounting policies and International Financial Reporting Standards. 5. Categorisation of the Proposed Transaction The Proposed Transaction is classified as a Category 2 transaction in terms of paragraph 9.5(a) of the JSE Listings Requirements and accordingly does not require the approval of Vukile shareholders. 22 May 2020 JSE sponsor NSX sponsor Java Capital IJG Securities (Pty) Ltd Date: 22-05-2020 05:02:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on, information disseminated through SENS.