JSE declines Growthpoint Properties' request in favour of Redefine

The JSE had declined Growthpoint Properties’ request for a ruling that Redefine be precluded from voting on all resolutions relating to Growthpoint’s bid for Fountainhead’s R10bn portfolio‚ Redefine said on Monday.

A favourable and expected decision by the JSE means it is business as usual for Redefine Properties and Fountainhead Property Trust‚ according to Redefine CEO Marc Wainer.

Redefine and Growthpoint have been in a bidding war for Fountainhead’s assets since last October‚ until Redefine withdrew its offer last month and acquired a 46% stake in Fountainhead.

Redefine bought Fountainhead’s management company for R660m last August before opening talks on the trust’s assets.

Redefine withdrew its offer‚ citing the negative effects on its ability to run Fountainhead’s business due to delays and uncertainty. Its acquisition of the 46% stake in Fountainhead was in line with its intention to acquire a stake if it did not acquire the assets.

Redefine’s 46% unitholding — which would make it difficult for Growthpoint to win a unitholder vote to secure the assets — led the Fountainhead board’s independent committee to terminate its engagement with Growthpoint last month.

Last week‚ Growthpoint said it had referred the matter to the JSE and requested that Redefine be precluded from voting on all resolutions‚ given the "conflict of interest between Redefine‚ the management company and Fountainhead unitholders".

Mr Wainer said on Monday that before Redefine withdrew its offer and acquired the stake‚ "we got a legal opinion as to whether we would be able to vote our shares‚ which was unequivocal. We had no doubt that the JSE would come to this decision."

He said his company was not concerned about the "host of allegations" Growthpoint had made to both the JSE and the Financial Services Board‚ as Redefine acted lawfully and within the JSE’s rules at all times.

Growthpoint’s submission to the JSE on whether Redefine could vote its units and whether Redefine could be blocked from voting on the required resolution was questionable as "that falls totally outside of the ambit of the JSE — that’s a statutory thing"‚ he said. "In the JSE’s response they said it fails on that alone.

"So one wonders either if Growthpoint and its advisers are aware of the legalities around Cisca (the Collective Investment Schemes Control Act)‚ or perhaps they just have another agenda‚" Mr Wainer said. Redefine said it did not believe it was necessary for its unitholders to exercise caution when trading their units.