Attacq to double stake in MAS Real Estate

The net asset value of MAS Real Estate’s property interests is set to exceed R1.3bn (EUR100m)‚ thanks to its acquisition of Attacq’s interest in its two Karoo investment funds. FILE PHOTO: MAS MD Lukas Nakos.

The net asset value of MAS Real Estate’s property interests is set to exceed R1.3bn (EUR100m)‚ thanks to its acquisition of Attacq’s interest in its two Karoo investment funds.

Attacq‚ previously known as Atterbury Investment Holdings and a major shareholder in MAS‚ is to list on the JSE soon.

MAS will pay Attacq EUR34.2m for its interest in these two funds by issuing about 32-million new MAS shares‚ thereby increasing Attacq’s holding in MAS from 23.9% to 47.3%.

MAS’s portfolio at present comprises properties in Germany‚ Switzerland and the UK and the acquisition will expand its portfolio in these locations.

Through the transaction‚ Attacq will be consolidating its European property holdings into MAS as it lists on the JSE. MAS currently has a secondary listing on AltX and intends to move to the JSE’s main board.

The two Karoo funds‚ listed on the Euro MTF Market of the Luxembourg Stock Exchange‚ are semi open-ended fixed maturity funds. Proceeds will be redeemed in early 2016 when these funds are expected to be wound up.

MAS MD Lukas Nakos said the assets were initially acquired from Attacq at a discount to their net asset value (NAV)‚ with a further adjustment made if the realised price from the funds on redemption was higher.

“The acquisition will turn MAS into a much more substantial business‚ while the increase in the size of the portfolio will markedly improve cost ratios and‚ overall‚ turn MAS into a more attractive counter for investors‚” Nakos said.

He said the transaction had been structured in such a way that it reduced risk for MAS should the funds not achieve their full NAV on redemption.

“When the two Karoo funds are unwound in 2016‚ the proceeds received will be used to add new properties to the existing portfolio.”

The two Karoo funds are currently invested mainly in European property trusts and companies‚ while MAS is invested directly in bricks and mortar.

“The acquisition of Attacq’s interest in Karoo should not be seen as a change in MAS’s investment strategy but as a way of obtaining a substantial amount of cash in a period of less than three years for further investments. In the interim‚ we expect to see a gross income of 7% from the investment‚” Nakos said.

Attacq CE Morne Wilken said the fund had delivered an average compound return of 20.62% to shareholders since inception eight years ago. The fund had traded over the counter until now and has an existing shareholder base of 570.