Johannesburg - Listed property funds Vukile, Arrowhead and Synergy are still negotiating the final terms of a potential deal.
If successful, the transaction will result in Vukile becoming an almost exclusively retail fund and Arrowhead using Synergy as a vehicle for implementing its strategy of a separately listed high-yielding, high-growth fund.
The talks follow Synergy last year becoming a subsidiary of Vukile, which owns 65 percent of the fund. Synergy confirmed on Friday that the final terms of the potential deal were being negotiated.
The three companies in March confirmed that broad consensus on the proposed transaction had been achieved.
The proposed transaction will further Vukile’s goal to be a leading retail real estate investment trust. If the transaction proceeds, more than 90 percent or R11 billion of the R12bn of physical assets in Vukile’s portfolio will be retail assets with Vukile also benefiting from its passive stake in the reconstituted Synergy.
In a proposed asset swop, the bulk of Synergy’s retail assets will move into Vukile, while Vukile will inject the majority of its office and industrial assets into Synergy.
BUSINESS REPORT