The purchase of the Prima property portfolio by ApexHi Properties Limited approved by both ApexHi unit holders and Prima unit holders, and Competition Tribunal.
The purchase of the entire Prima property portfolio by ApexHi Properties Limited has been unconditionally approved by both ApexHi unit holders and Prima unit holders, as well as the Competition Tribunal.
The R1,020-billion transaction remains subject to a high court order for the winding up of Prima.
“Prima unit holders, who voted in favour of the acquisition, stand to benefit from becoming part of a much larger property company where higher than average trading volumes provide greater liquidity to shareholders,” says ApexHi director, Deon Feinblum.
Prima unit holders will receive 5,9 ApexHi A units and 5,9 ApexHi B units for every 100 Prima units held.
ApexHi A and B unit investors, who also voted in favour of the acquisition, are expected to benefit from the purchase of Prima, which will boost the company’s market cap to in excess of R5-billion, reduce vacancies, and increase the portfolio’s exposure to the buoyant retail sector.
Feinblum says the Prima portfolio meets the company’s acquisition strategy criteria. The Prima portfolio comprises retail (57%), commercial (31%) and industrial (12%) properties, located in all nine provinces in South Africa, with very few located in the inner cities of the major metropolitan areas. The property portfolio is well let with predominantly national and regional A-grade tenants and a low vacancy of only 6% of the total GLA of 348,600m2.
“Most importantly, the Prima portfolio does not dilute revenue, and it meets our objective of shifting the weighting of the portfolio to retail,” says Feinblum. The office portfolio has reduced from 44% to 39%, and the retail component has increased from 40% to 43%. The vacancy has also reduced from 11% to 10%.
“The Prima retail portfolio complements our existing retail portfolio, which is predominantly convenience retail centres in suburban locations. The convenience retail centres are performing extremely well, with low vacancies, good tenants, and a high probability of retaining tenants, or replacing them easily,” says Feinblum.
The merger of the two portfolios will result in cost savings, as the Prima properties are located in areas where ApexHi already has offices and teams that manage the existing portfolio. “In addition, Broll Property Group currently manages both portfolios, which should ensure a smooth transition,” he says.
