23 Sep - 4 min read

Disposal of Letting Enterprise

Disposal of Letting Enterprise

PUTPROP LIMITED
Incorporated in the Republic of South Africa
(Registration number 1998/001085/06)
Share code: PPR      ISIN: ZAE0000072310
(“Putprop” or “the Company”)


DISPOSAL OF LETTING ENTERPRISE


1. INTRODUCTION

   Shareholders are advised that Putprop has entered into a sale of letting enterprise agreement (“Sale
   Agreement”) with Brits Hardware Close Corporation (“Purchaser”) on 22 September 2021 (“Signature
   Date”) for the disposal of the letting enterprise conducted by the Company as described below (“the
   Letting Enterprise”), for a purchase price of R17 million (“the Disposal”).

   The Letting Enterprise comprises:

   o     the “Property”, being the immovable properties, including buildings, situated at 1 to 25 Piet
         Rautenbach Street, Brits Extension 13, known as Erf 1770 and Erf 1771, Brits Extension 13;
   o     the “Lease Agreement(s)” entered into between Putprop and the tenants / lessees of the Property;
         and
   o     certain fixtures, fittings, furniture, equipment and assets at the Property (“Movable Assets”).

2. THE DISPOSAL

   2.1    Details of the Property

          The Property means Erf 1770 and Erf 1771, Brits Extension 13, district Brits Province of North
          West, used in connection with the operating of the letting enterprise conducted by the Company.

          The gross lettable area of the Property is 13 001m2 and the weighted average net rental per
          square metre is currently R7.6.

   2.2    Rationale for the Disposal

          The Property has been identified as a non-core property due to its location and age. Management
          believes the funds released by the sale of the Property can be better utilised elsewhere.

          The proceeds of the Disposal will be utilised by Putprop to acquire income producing properties.

  2.3    Suspensive condition and effective date

         2.3.1    The Disposal is conditional on the fulfilment of the following suspensive condition within
                  45 calendar days from Signature Date:

                  2.3.1.1 the Purchaser obtains approval for a loan with a bank or other financial institution
                          for the “Loan Amount”, being the purchase price of R17 million
                          (“Consideration”), less an amount of R1.7 million (“Deposit”), upon the security
                          of a first mortgage bond to be registered over the Property.

         2.3.2    Should the suspensive condition not be fulfilled or waived timeously, the Sale Agreement
                  will no longer be of any force and effect. Putprop and the Purchaser will be restored, as
                  closely and as may be reasonably and practically possible, to the position in which they
                  were prior to the Signature Date.

         2.3.3    The effective date of the Disposal will be the date of fulfilment of the aforementioned
                  suspensive condition (“Effective Date”).

   2.4   Consideration

         2.4.1   The Consideration payable by the Purchaser to the Company for the Letting Enterprise
                 is payable in cash as follows:

                 2.4.1.1    within seven calendar days of the Effective Date, the Deposit is paid into the
                            conveyancer’s trust account; and
                 2.4.1.2    the balance of the Consideration is paid on the date of registration of transfer
                            of the Property in the name of the Purchaser.

         The Sale Agreement contains warranties and undertakings which are standard for a disposal of
         this nature.

   2.5   Details pertaining to the Purchaser

         Brits Hardware Close Corporation, represented by Mohamad Shafi Anwar Bataviya, is the
         Purchaser. The Purchaser is not a related party to Putprop.

3. FINANCIAL INFORMATION

   The value of the net assets attributable to the Disposal was R14.9 million as at 30 June 2021 (audited).
   The audited loss after tax attributable to the net assets for the year ended 30 June 2021 was
   R0.267 million.

   The financial statements were prepared in accordance with International Financial Reporting Standards
   and the Companies Act, 2008 (Act 71 of 2008), as amended.

4. INDEPENDENT VALUATION OF THE DISPOSAL

   A valuation of the Property was performed on 30 June 2021 by Shawn Crous MRICS representing
   JLL South Africa who is independent and is registered as a professional valuer in terms of the Property
   Valuers Profession Act, 2000 (Act 47 of 2000) (“Act”). The Property was valued at an amount of
   R14.9 million.

   This independent valuation is supported by the Board. The members of the Board are not independent
   valuers and are not registered as professional valuers or as professional associate valuers in terms of
   the Act.

5. CATEGORISATION OF THE DISPOSAL

   The Disposal is classified as a Category 2 transaction in terms of the Listings Requirements of JSE
   Limited.


23 September 2021

Sponsor
Merchantec Capital

Date: 23-09-2021 04:30:00
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