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Financial and property information - category 1 acquisition by Arrowhead of Fairvest via a scheme of arrangement
ARROWHEAD PROPERTIES LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2007/032604/06)
JSE share code: AHA ISIN: ZAE000275491
JSE share code: AHB ISIN: ZAE000275509
(Approved as a REIT by the JSE)
(Arrowhead)
FINANCIAL AND PROPERTY SPECIFIC INFORMATION IN RESPECT OF THE PROPOSED CATEGORY 1
ACQUISITION BY ARROWHEAD OF FAIRVEST BY WAY OF A SCHEME OF ARRANGEMENT
1. Introduction
Shareholders are referred to the joint SENS announcement (Firm Intention and Category 1 Announcement)
released by Arrowhead and Fairvest Property Holdings Limited (Fairvest) today in respect of, inter alia, a
proposed merger to be implemented by way of a scheme of arrangement in terms of section 114 of the Companies Act,
No. 71 of 2008, and to which Arrowhead will be a party (Transaction).
In terms of the Transaction, Arrowhead has offered to acquire 100% of the Fairvest ordinary shares (Fairvest
Shares) in issue, excluding the Fairvest Shares held in treasury, from Fairvest shareholders, which Transaction
will constitute a category 1 acquisition for Arrowhead in terms of the JSE Listings Requirements. In compliance
with paragraphs 9.15(d) and (e) and paragraphs 13.11(a) and 13.19 of the JSE Listing Requirements, the
information contained in paragraphs 2 and 3 below is disclosed in addition to the information disclosed in the Firm
Intention and Category 1 Announcement.
2. Financial Information of Fairvest
The value of the net assets and the profit attributable to the net assets of Fairvest are R2 441 524 000 and
R332 553 000 respectively (Financial Information).
The Financial Information in this announcement has been extracted from Fairvest's audited results for the year
ended 30 June 2021 (Fairvest Results), which was prepared in terms of International Financial Reporting
Standards, and which is the responsibility of the directors of Fairvest. BDO South Africa Incorporated issued their
audit report on the Fairvest Results on 10 September 2021, however the Financial Information in this
announcement has not been reported on or reviewed by a reporting accountant.
3. Property specific information of Fairvest
The table below sets out the details of the properties within the Fairvest property portfolio as at 30 June 2021,
and as included in the Fairvest Results.
Weighted
Rentable average Valuation Cost of
area rental per 30 June 2021 Date of acquisition
Property Name Location Sector (m2) m2 (R) (R'000) acquisition (R'000)
Kwazulu-Natal
Shoprite Empangeni Empangeni Retail 13 660 152.47 223 800 18-Jul-17 172 500
Westville Junction Westville Retail/Office 6 330 173.69 98 400 19-Jan-01 16 500
Richmond Shopping Centre Durban Retail 8 798 93.23 99 200 21-May-15 61 538
CHEP Building Westville Office 3 337 # 76 600 1-Dec-12 51 076
Qualbert Centre Durban Retail 4 684 163.32 79 000 30-Jan-14 68 778
425 West Street Durban Retail/Office 5 162 122.37 59 900 18-Jan-13 54 500
Coronation Walk Queensburgh Retail/Office 3 047 167.08 49 300 19-Nov-01 9 000
210 Church Street Pietermartitzburg Retail 1 897 # 30 000 18-Dec-12 19 556
212 Church Street Pietermartitzburg Retail 1 980 # 36 800 14-Dec-12 30 000
Mkuze Corner Mkuze Retail 3 388 87.16 32 200 13-Dec-12 15 000
52 283 785 200
Western Cape
Nonkqubela Mall Khayelitsha Retail 10 765 174.12 171 000 23-Aug-19 162 900
Nyanga Junction Nyanga Retail 10 683 170.49 170 900 16-May-13 58 000
Paddagat George Retail 11 007 101.59 115 800 13-Dec-12 44 000
Macassar Shopping Centre Macassar Retail 5 516 146.57 85 900 12-Sep-16 41 500
Omniplace Bellville Office 2 627 112.00 30 200 13-Dec-12 20 000
Nyanga Shopping Centre Nyanga Retail 1 242 # 4 900 24-May-13 8 427
41 840 578 700
Free State
Middestad Centre Bloemfontein Retail 18 609 150.44 287 600 26-Aug-15 190 987
Megapark Bloemfontein Retail 6 744 118.29 83 900 26-Aug-15 52 015
Zamdela Shopping Centre Zamdela Retail 2 247 112.70 29 500 20-Feb-13 13 867
Bradlows Building Bloemfontein Retail 2 563 44.52 11 600 19-Nov-01 4 100
30 163 412 600
Gauteng
Bara Precinct Soweto Retail 24 486 146.16 368 100 18-Dec-17 322 435
Southview Shopping Soshanguve Retail 7 644 124.42 106 300 18-Jun-18 92 914
Clubview Corner Centurion Retail 6 074 126.02 81 300 17-Jan-13 27 000
Sebokeng Plaza* Sebokeng Retail 5 693 112.67 72 000 26-Apr-13 35 298
The Ridge Shopping Centre Roodepoort Retail 4 663 151.25 69 000 12-Mar-13 30 000
Jan Niemand Spar Pretoria Retail 2 139 # 23 800 19-Feb-15 20 000
Orange Farm Orange Farm Retail 2 685 88.39 28 200 15-Jan-13 15 781
Pick `n Pay Vereeniging Vereeniging Retail 3 538 91.98 28 700 10-Apr-13 12 934
The Palms Midrand Office 2 597 67.45 13 900 2-Mar-07 10 558
Score Stretford Stretford Retail 1 508 # 14 000 19-Feb-13 9 509
Score Sharpeville Sharpeville Retail 1 139 # 14 700 19-Feb-13 6 914
62 166 820 000
Limpopo
Mala Plaza Malamulele Retail 6 076 147.01 101 000 27-Jan-14 64 766
Masingita Shopping Centre Giyani Retail 5 363 143.55 71 700 27-Jan-14 48 466
11 439 172 700
Northern Cape
Sibilo Shopping Centre Postmasburg Retail 8 476 148.08 129 400 24-Aug-15 96 323
Kim Park Kimberley Retail 9 301 122.60 117 400 8-Jan-14 53 014
17 777 246 800
Eastern Cape
Boxer Elliotdale Elliotdale Retail 7 360 117.30 81 100 9-May-16 59 830
Bokleni Plaza Libode Retail 4 990 120.03 67 700 3-Oct-18 49 000
Qumbu Plaza Qumbu Retail 5 395 107.50 67 300 1-Dec-19 51 911
Boxer Mqanduli Mqanduli Retail 4 689 111.70 48 500 15-Jul-16 37 600
Boxer Tabankulu Tabankulu Retail 4 117 109.45 42 400 7-Jul-16 32 000
26 551 307 000
Mpumalanga
Cosmos Centre Bethal Retail 4 692 136.85 80 800 5-Mar-15 58 000
Investment property held for sale
Parow Valley Spar Parow Retail 3 985 101.77 36 200 10-May-16 20 255
* - 50% undivided share 250 896 134.35 3 440 000
Vacant unlettable property
Fattis Mansions Johannesburg Retail 1 921 - - 19-Nov-01 6 520
Notes:
1. The Fairvest property portfolio consists of 43 properties, with 250 896 m2 of lettable area and valued at R3.44 billion.
At 30 June 2021, 9 228 m2 or 3.7% of the gross lettable area was vacant. Average annualised property yield was 9.8%.
2. The individual property valuations as at 30 June 2021 were obtained from Fairvest management.
3. # Means single tenanted properties. The weighted average rent per m2 for all single tenanted properties is R155.61 at 30 June 2021.
4. 35.8% (2020: 39.8%) of the value of the above Fairvest investment property portfolio was valued by DDP Valuers, De Leeuw
Valuers and Broll Valuation and Advisory Services (who are independent from Fairvest and are registered as professional
valuers in terms of the Property Valuers Profession Act, No. 47 of 2000) at 30 June 2021, and all have experience in the
valuation of similar investment properties. The remainder of the income-producing investment properties were valued by
Fairvest management. The valuations were based on open market values for existing use for each individual investment
property. For the current and prior year, the valuation of the properties was performed using the discounted cash flow method.
5. 100% of the Fairvest property portfolio will be valued for purposes of the circular and accompanying revised listing particulars
to be issued to Arrowhead shareholders in relation to the Transaction.
4. Responsibility statement
The board of directors of Arrowhead (Arrowhead Board) accepts responsibility for the information contained in
this announcement insofar as it relates to Arrowhead. To the best of the Arrowhead Board's knowledge and belief,
the information contained in this announcement is true and the announcement does not omit anything likely to
affect the importance of the information.
27 September 2021
Strategic transaction advisor
Ferryman Capital Partners
Joint corporate advisor and transaction sponsor
Nedbank Corporate and Investment Banking, a division of Nedbank Limited
Legal advisor
Cliffe Dekker Hofmeyr Incorporated
Date: 27-09-2021 02:02:00
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