Redefine to increase Fountainhead stake by offering Hyprop shares

Redefine Properties CEO Marc Wainer says this will progress Redefine’s stated intention to increase our stake in Fountainhead and exit our holding in Hyprop.

South Africa’s second-biggest property company, Redefine Properties today announced plans to acquire an additional 250 million participatory units in Fountainhead Property Trust.

Redefine proposes an offer that consists of 110 units of Hyprop Investments for every 1,000 units of Fountainhead, the company said in a statement.

Redefine which owns about 50 percent of Fountainhead, is already the largest single Fountainhead participatory unitholder.

In terms of Companies Act requirements, Redefine will acquire a minimum of 135,000 units from any single vendor of Fountainhead units, and thereafter in multiples of 1,000 units.

The offer opens on Wednesday, 2 October 2013 and will remain open either until the close of business on Friday, 18 October 2013 or earlier by Redefine notifying the market on SENS the withdrawal of its proposal.

Marc Wainer, CEO of Redefine, says: “This will progress Redefine’s stated intention to increase our stake in Fountainhead and exit our holding in Hyprop. We advised the market that, once we achieved REIT status, we would widen the initial offer to include more unitholders and now we are honouring our commitment. Unfortunately, regulations prohibited us from opening the offer to all unitholders.”

Wainer adds it will further align the interest between Redefine and Fountainhead unitholders.

Fountainhead shares rose for the first time in six days, gaining as much as 4.6 percent.

The stock traded 1.4 percent higher at 7.98 rand as of 9:29 a.m. in Johannesburg trading, valuing the company at 9.3 billion rand. Hyprop stock fell 0.6 percent to 73.40 rand.