ORION REAL ESTATE LIMITED - Update announcement, renewal of cautionary announcement and new cautionary announcement

Update announcement, renewal of cautionary announcement and new cautionary announcement

ORION REAL ESTATE LIMITED
(Incorporated in the Republic of South Africa)
(Registration number: 1997/021085/06)
Share Code: ORE ISIN: ZAE000075651
("Orion " or “the Company” or “the Group”)


UPDATE ANNOUNCEMENT, RENEWAL OF CAUTIONARY ANNOUNCEMENT AND NEW CAUTIONARY ANNOUNCEMENT


A    DISPOSAL OF THE PROMENADE

1.   Introduction
     Shareholders are referred to the detailed cautionary announcement published on
     18 December 2018 whereby they were advised that the Orion Property Holding Trust (“the
     Seller”), a trust which holds the properties managed by Orion Real Estate on behalf of the
     Company and for the benefit of the Company had signed an agreement (the “First Offer”),
     subject to certain conditions precedent, for the disposal of the rental enterprise, constituting
     the property known as the Promenade Shopping Centre, situate at Remaining Extent of Erf 404,
     Nelspruit (“the Property”) and the leases managed by the Company in respect thereof (the
     “Disposal”), as a going concern to Prinia Asset Management Proprietary Limited on behalf of
     a company to be formed or nominated (the “Purchaser”).

     Certain of the conditions precedent have not yet been met by the Purchaser and accordingly
     the Purchaser has been placed on terms, which agreement will lapse on 6 February 2019 in the
     event of non-performance.

     However, shareholders are advised that the Seller has received a second, higher offer from
     Flameup Investments Proprietary Limited (“Flameup”) to purchase the Property for a
     consideration of R185 million (the “Second Offer”), which offer has been accepted subject to
     the First Offer lapsing. The terms of the Second Offer, which is subject to normal conditions
     precedent, will be announced in the event of the First Offer lapsing. Flameup is not a related
     party to Orion.

B    TRANSFER OF PROPERTIES
     Shareholders are advised that the transfer of the first of 9 properties acquired as announced
     on 20 March 2018 has been processed through the Deeds office. The process has been taking
     much longer than expected due to the required SARS and rates clearances and the Deeds
     Office closing during December but good progress is now being made. These acquisitions
     address the JSE’s 20% public shareholder spread requirements for companies listed on the Main
     Board of the JSE.

C    LEGAL PROCEEDINGS
     Shareholders are referred to the previous announcement issued on 18 December 2018 and are
     advised that the liquidation application by Investec Bank Limited (“Investec”) has been
     opposed by Orion in January 2019 and Orion is in the process of securing new guarantees in
     favour of Investec. The intention of Orion is that Investec will be settled in full.

     Shareholders are reminded that the current gearing of Orion is less than 20% of its gross assets
     so the Orion group is not heavily geared.

D    UPDATE ON THE PUBLICATION OF ORION’S AUDITED RESULTS FOR THE YEAR ENDED 30 JUNE 2018
     Management is busy finalising the audit with the aim of publishing its results before the end of
     February 2019. Shareholders will be updated in due course as to the timing of the publication
     and the issue of the Annual Report. Thereafter, the Company will apply to the JSE for the lifting
     of the suspension of trade in the Company’s securities.
E    OTHER OFFERS – NEW CAUTIONARY ANNOUNCEMENT
     Shareholders are advised that the Company has received a number of offers on other
     properties, including Orion House in Braamfontein and ACA in Auckland Park. These offers are
     being evaluated at present and a further announcement will be made in due course.

E    RENEWAL OF CAUTIONARY
     Shareholders are also advised to continue to exercise caution when dealing in their securities
     until a further announcement is made regarding the proposed disposal of the Property and
     potential liquidation of the Company. In addition, shareholders are again referred to the
     announcement on 6 November 2018 regarding other potential acquisitions and are advised
     that the cautionary announcement is renewed.

JOHANNESBURG
5 February 2019

Sponsor
Arbor Capital Sponsors Proprietary Limited

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