Growthpoint Properties to pursue Fountainhead despite termination

Growthpoint has requested a formal ruling from the JSE that Redefine be precluded from voting on all resolutions‚ including the vote required to amend the Trust Deed‚ and is awaiting the JSE’s response.

Growthpoint Properties (GRT) said on Wednesday it was pushing ahead with its revised proposal to acquire Fountainhead Property Trust’s portfolio despite the latter’s declaration last month that it had terminated talks in this regard.

Fountainhead on March 28 terminated talks with Growthpoint on the basis that Redefine Properties - which holds a 45.6% stake in the trust - would vote against any resolutions or ballot of unitholders to approve Growthpoint’s proposal.

“To this end‚ Growthpoint has requested a formal ruling from the JSE that Redefine be precluded from voting on all resolutions‚ including the vote required to amend the Trust Deed‚ and is awaiting the JSE’s response‚” Growpointpoint said on Wednesday.

Redefine had been involved in a tussle with Growthpoint to acquire the trust’s assets‚ before pulling out of the battle on March 11‚ citing "no resolution in sight"‚ and the negative effect it was having on its ability to run Fountainhead’s business due to delays and uncertainty.

Growthpoint on February 21 increased its offer for Fountainhead assets to 37 Growthpoint linked units per 100 Fountainhead units‚ equating to a further R605m to that of its initial offer. The second offer was at a premium of 12.8% to the closing price of Fountainhead and a premium of 8.6% or R857m to the Redefine second offer.

Growthpoint and Redefine were both bidding for Fountainhead’s R10.3bn portfolio in the past few months until Redefine withdrew its offer last month, saying that there was "no resolution in sight" and that the delays and uncertainty were negatively affecting its ability to run Fountainhead’s business.

Redefine bought a large stake in Fountainhead to align Redefine and Fountainhead unitholders’ interests and to block Growthpoint’s offer — its shareholding would make it difficult for Growthpoint to win a unitholder vote on the assets.