Vukile in talks to buy Wingspan property portfolio

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Laurence Rapp, CEO of Vukile Property Fund. Vukile said it had entered into negotiations for the acquisition, either alone or together with a third party, of the Wingspan property portfolio, comprising 5 regional shopping centres. Laurence Rapp, CEO of Vukile Property Fund. Vukile said it had entered into negotiations for the acquisition, either alone or together with a third party, of the Wingspan property portfolio, comprising 5 regional shopping centres.

JSE-Listed Vukile Property Fund (VKE), on April 26 announced that it was in talks to acquire Wingspan’s property portfolio comprising 5 regional shopping centres‚ either alone or together with a third party.

The acquisition‚ if completed‚ will be subject to the fulfillment of conditions‚ including competition authority approval.

Wingspan’s property portfolio comprises five regional shopping centres.

Vukile cautioned that the potential deal might have material impact on its share price.

Last month, Vukile concluded an agreement with Encha Properties (Encha) in one of the most significant Black Economic Empowerment (BEE) initiatives in the listed property sector to date.

Vukile said it would acquire a portfolio of five investment-grade, predominantly national government-tenanted properties from Encha for about R1.4 billion. After the transaction, Encha will own a R600m stake in Vukile — representing a holding of about 7.5% in Vukile’s enlarged unit capital.

The properties in the portfolio comprise Navarre Wachthuis, the Koedoe Arcade and De Bruyn Park in Pretoria, the Pretoria Momentum building and the Bloemfontein Fedsure building.

A "sub-portfolio" will be established within Vukile to house the new properties as well as any other government-tenanted properties that Vukile may own or acquire. Encha will be appointed as the property and asset manager of the new sub-portfolio.

In addition, Sedise Moseneke, Encha CEO and current president of the South African Property Owners Association, will be appointed as an executive director of Vukile.

As well as having executive responsibility for driving Vukile’s overall transformation strategy, Mr Moseneke "will oversee the government-tenanted portfolio and work with Vukile CEO Laurence Rapp in seeking to grow the fund in line with Vukile’s stated strategy of building a large diversified property fund that’s overweight in the retail sector".

Mr Rapp said Vukile believed the deal has "tremendous benefits" for Vukile as it allowed the company to implement a "sustainable transformation transaction that is done in a commercially viable manner that is not only earnings enhancing but also serves to create long-term alignment across our various stakeholders".


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