Redefine now owns 45,2% of the retail focused fund, valued at R3,9-billion at current prices, and does not expect this stake to increase materially, despite the mandatory offer to Hyprop unitholders.

Redefine CEO Marc Wainer says Hyprop unitholders have until 27 August to sell their Hyprop units to Redefine for R50 per unit, which is slightly below the current trading price of Hyprop’s units.

Wainer says the Redefine board is grateful for the support from its unitholders and has undertaken to obtain Redefine unitholder approval before acquiring any further Hyprop units subsequent to this transaction and the mandatory offer.

The acquisition is a coup for Redefine. The units, which were purchased from Coronation for R984-million, have increased in value by R30-million based on the closing price on 11 August.

Redefine’s distributions for the 2011 financial year are expected to be enhanced by between 0.6 cents and 0.8 cents per unit, based on Redefine’s assessment and estimates of Hyprop’s distributions for the forecast period.

A 45% holding in Hyprop represents effective control, and if Redefine should choose to sell its stake sometime in the future, it would attract a control premium.

“We are delighted to have enhanced our listed securities portfolio with this stake, and are looking forward to working closely with the Hyprop team to protect and enhance our significant investment, which will benefit both Hyprop and Redefine unitholders,” says Wainer.