SA Retail’s future has market abuzz

Posted On Tuesday, 29 March 2005 02:00 Published by eProp Commercial Property News
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Speculation that listed property loan stock company SA Retail Properties could be the target of a hostile takeover bid by another listed property fund has set the market abuzz for the past two weeks.

Angelique de Rauville

However, analysts were divided on who was likely to be the main contender for a takeover.

Listed property loan stock company Redefine Income Fund, which owns about a 27% interest in SA Retail, was viewed as either a possible bidder or seller.

Redefine spokesman Marc Wainer said yesterday Redefine had at this stage no intention of making an offer for SA Retail — but said Redefine had been approached by a "number of parties" wanting to buy out its interest in SA Retail.

"We haven’t seen what we believe is an attractive-enough offer. People approach us all the time, and at the right price we’d sell the stake."

Peter Sparks, MD of SA Retail, was not available for comment.

Angelique de Rauville, MD of listed property portfolio management company Provest, said that if Redefine had no intention of making an offer to minority unitholders in SA Retail, it would not be surprising for other funds or companies on an acquisition trail to approach Redefine "with the intention of acquiring its strategic stakeholding".

De Rauville said the SA Retail property portfolio contained some property assets that would be suitable for other funds or companies within the listed property sector, including certain funds in which the Madison group had an interest. Madison, which asset-manages Redefine, has interests in the management companies of listed property funds ApexHi, Prima and Hyprop.

Colin Young, fund manager of Old Mutual’s SA-listed property funds, said it would make sense for Redefine to invest more in fixed retail properties and sell more of its listed property units in other companies while listed property yields were low.

But, Young said, if Redefine wanted to acquire SA Retail’s assets it would be inclined to offer Redefine units in exchange for the assets — and this would be difficult because Marriott, which manages SA Retail and listed property unit trust Martprop, might counter such a move with other "attractive alternatives", such as a merger of SA Retail and Martprop.

Last modified on Monday, 12 May 2014 14:05

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