THE MERGER between listed property firms Premium Properties and Octodec is set to become effective next month after 100 percent of shareholders of the two firms represented at general meetings yesterday voted in favour of the offer.
The merger will result in a group with a market capitalisation of more than R5 billion and a combined portfolio of 325 properties valued at an estimated R10bn.
It will provide investors with significant exposure to the residential property sector compared with other listed real estate investment trusts and a mix of retail, office and industrial assets.
In terms of the proposed transaction, which is still subject to a number of conditions, including approval by the competition authorities and other regulatory approvals, Octodec will offer 88.5 of its own shares in exchange for every 100 Premium linked units held.
The successful closure of the transaction will result in Premium and IPS Investments, which is owned 50 percent each by Premium and Octodec and has a complementary portfolio, becoming wholly owned subsidiaries of Octodec.
Jeffrey Wapnick, the managing director of both Octodec and Premium, said the companies were pleased with the support they had received from their shareholders.
“We are now one step closer to creating a sizeable company offering an attractive investment proposition backed by a solid track record of delivery, a healthy projects pipeline and strong asset mix concentrated in the high-growth nodes of the Pretoria and Johannesburg central business districts,” Wapnick said.
Anthony Stein, the financial director of both Octodec and Premium, said the scale of Octodec would facilitate improved liquidity and, in addition to the existing facilities already in place for both entities, enable access to fresh capital at more attractive rates.