SA largest property company offers juicy price for UK shopping mall owner

Canopy by Hilton in Cape Town (artist's impression)
Canopy by Hilton in Cape Town (artist's impression)

Growthpoint [JSE:GRT], SA’s largest listed property company, has made a sweet bid to acquire more than half of UK shopping mall owner Capital & Regional plc.

It is offering shareholders 33 pence per Capital & Regional share – double the level at which it was trading in September before Growthpoint made its intentions known. It aims to secure around 30% of the company through this offer. Capital & Regional will then also issue new shares to Growthpoint which will push its holding up to above 51%.

Growthpoint owns 450 buildings including a number of company headquarters and shopping centres like the Brooklyn Mall and Constantia Village Mall in South Africa. It also has a 50% stake in the V&A Waterfront and owns 63% of Growthpoint Properties Australia, which has 57 properties in Australia.

Capital & Regional, meanwhile, owns £1bn in properties in the UK, mostly shopping malls.

As part of the transaction, Capital & Regional will receive £77.9m (before costs), and it has agreed with Growthpoint to use at least £50m of the proceeds to reduce its debt levels.

Growthpoint says it is interested in Capital & Regional because it offers retailers affordable rentals averaging at £15 per square foot, and has a "significant concentration" in the attractive London and South East England markets. In added it will support Capital & Regional to acquire further properties in the UK, but it first wants to see the companies reduce its debt levels.

Compiled by Helena Wasserman

* This article has been amended to refer to Capital & Regional throughout. 

ZAR/USD
17.01
(-0.26)
ZAR/GBP
21.27
(-0.29)
ZAR/EUR
19.24
(-0.20)
ZAR/AUD
11.84
(-0.03)
ZAR/JPY
0.16
(-0.15)
Gold
1782.97
(-0.10)
Silver
18.19
(-0.40)
Platinum
817.00
(-0.30)
Brent Crude
43.07
(+0.70)
Palladium
1924.00
(+0.34)
All Share
54846.28
(+0.60)
Top 40
50503.91
(+0.65)
Financial 15
10134.53
(-0.15)
Industrial 25
76434.98
(-0.16)
Resource 10
51142.00
(+2.00)
All JSE data delayed by at least 15 minutes morningstar logo
Company Snapshot
Voting Booth
Please select an option Oops! Something went wrong, please try again later.
Results
I'm not really directly affected
18% - 1653 votes
I am taking a hit, but should be able to recover in the next year
23% - 2176 votes
My finances have been devastated
34% - 3228 votes
It's still too early to know what the full effect will be
25% - 2350 votes
Vote