Resilient property income fund sells noncore assets

Posted On Monday, 02 November 2009 02:00 Published by eProp Commercial Property News
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Resilient Property Income Fund is disposing of its non core assets to a newly-listed property fund for more than R665m, in order to focus on larger and dominant regional malls.

Des de Beer ResilientFund is disposing of its non core assets to a newly-listed property fund for more than R665m, in order to focus on larger and dominant regional malls.

The group said on Friday it had reached an agreement with Fortress Income Fund, a property loan stock company, to dispose of the entire issued share capital of and shareholder claims against its wholly owned subsidiary Fortress Income 2.

Fortress Income 2 owns 19 properties.

Resilient invests in dominant retail centres with strong anchor tenants and a high percentage of national retailers with a focus on non-metropolitan nodes.

The purchase price in Resilient disposal of Fortress Income 2 was settled by the allotment and issue or delivery of 63213200 “A” linked units in Fortress at R9 per linked unit and 63213200 “B” linked units at R1 per linked unit. Resilient said the balance of the purchase price would be settled for cash in an amount of R33m.

The cash proceeds of R33m had been used to reduce interest bearing liabilities at an effective interest rate of 9,5%, the group said.

Save for Musina Shopping Centre, valued at R28,5m, all properties had been transferred to Fortress Income 2. The disposal deal contained warranties normal for disposals of this nature.

All the conditions to which the disposal agreement was subject had been fulfilled.

Resilient would use the cash portion of the sale proceeds to reduce debt. The group said it might dispose of the Fortress “A” and “B” linked units, depending on market conditions, to fund new retail developments.

 

Last modified on Monday, 28 April 2014 19:35

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