File image: IOL.
CAPE TOWN - Aveng, the financially troubled listed construction and engineering group, has entered into agreements to offload two of its properties, including its Jet Park head office, for a total of R253.8 million.

It said that the proceeds from the disposals would be used to strengthen the group’s financial position and reduce its overall debt. The proposed sales were in line with the outcome of a recent strategic review conducted by Aveng.

In terms of the review announced in February, the group’s long-term strategy was to become an international infrastructure and resources group with a footprint in developing and fast-growing regions.

Aveng said that it had entered into a binding term sheet for the sale of its offices in Jet Park, Boksburg, to listed Equites Property Fund for R211.2m. The group added that it would enter into a triple net lease on the property for a maximum of 24 months, but with the ability for Aveng to terminate the lease with three months notice at a market related monthly rental of R1.1m.

The monthly rental was subject to an annual escalation of 8percent. The transaction was still subject to certain conditions precedent, but was expected to be effective from December 1 this year. At end-December last year, Jet Park had a net asset value of R124.4m and profits attributable to this property of R86.8m. Aveng said the proposed transaction required shareholder approval.

The second property transaction involves Van der Bijl Park. The group has agreed to accept an offer for R42.6m from Stodast for the property following an auction.

At end-December last year, the Van der Bijl Park property had a net asset value of R100m, with a loss of R57.4m attributable to this property.

Listed engineering and construction group Murray & Roberts (M&R), which is the subject of a hostile takeover by German family-owned investment holding firm Aton, in May announced the proposed acquisition of Aveng for R1billion in an all-share transaction.

The Takeover Special Committee this week overturned a decision by the Takeover Regulation Panel allowing the board of M&R to continue developing the potential acquisition of Aveng. The committee prohibited M&R from further developing potential Aveng transaction while the Aton offer remained in place.

Aveng shares closed unchanged at 8cents a share on the JSE on Friday.