New property listing on JSE

Business Venture Investments No 1554 Proprietary Limited (which is in the process of being renamed Hermans & Roman Properties Limited) (“HRP” or the “Company”) is pleased to announce its intention to list its linked units on the securities exchange operated by the JSE Limited (“JSE”) during the second quarter of 2012.

The Company is structured as a property loan stock company and the linked units of the Company are intended to be listed in the “Real Estate Holdings and Development” sector of the Main Board of the JSE.

HRP is a newly-established, internally-managed real estate company focused on investing in and managing retail and office properties in South Africa and selected other sub-Saharan African countries. On listing, the Company will own a portfolio of five large, high-quality, well-established retail and office properties (the “Portfolio”), as well as the property management business of Hermans & Roman Property Solutions (Proprietary) Limited (“HRPS”), one of the larger independent specialist real estate managers in South Africa. HRPS was founded in 2002 by Leslie Hermans and Kevin Roman, the Company’s CEO and Executive Director, respectively, who collectively have 46 years of experience in asset management, property management and related property services in the South African real estate market. HRPS today manages assets that the directors estimate to be worth approximately R8.5 billion on behalf of 24 blue chip clients.

Leslie Hermans, CEO of the Company, said:

“Over the last ten years we have built up HRPS into a substantial property management business and have managed real estate portfolios that the directors estimate to be worth in excess of R20 billion in aggregate.  The proposed listing is an exciting step forward.  We have assembled a portfolio of high-quality, regionally-prominent and scarce prime properties offering stable, defensive cash flows and value creation potential.  Our focus post-listing will be to grow the portfolio and deliver superior shareholder returns.”

The Portfolio comprises three primarily retail properties and two primarily office properties and will be managed by HRP’s highly-experienced team of real estate professionals who collectively have more than 140 years of experience in the retail and office property sectors. Four of the five properties in the Portfolio are located in South Africa (Johannesburg, Mossel Bay, Cape Town and Durban), and the fifth property is located in Lusaka, Zambia.

The largest properties in the Portfolio are Bedford Centre and Bedford Square, a state-of-the-art shopping centre located in Johannesburg, and Manda Hill, located in Lusaka, which is one of the largest in sub-Saharan Africa (excluding South Africa) and which recently underwent a redevelopment/ refurbishment and expansion programme. The other properties comprise Langeberg Mall, a regionally -prominent shopping centre in Mossel Bay, H&R Technology Park, one of the largest mixed-use properties in the South Peninsula in Cape Town, and Liberty Towers, one of the larger office properties in Durban’s CBD.  The Portfolio has been independently valued, as at 1 April 2012, at an aggregate market value of R3.6 billion.

Leslie Hermans added:

“One of the strengths of HRP is our exposure to the high growth economies of South Africa and sub-Saharan Africa as well as the growing retail market and higher-yielding office market.  Our long-term vision is to build a focused real estate company comprising a limited number of large, primarily retail properties in growth markets in South Africa and selected other sub-Saharan African countries.”

The listing is intended to be implemented, together with a capital raising by the Company, through a private placement to qualifying investors only and there will not be an offer to the general public. The net proceeds of the offer will be used to, inter alia, fund a portion of the purchase consideration for the Portfolio, with the remainder of the purchase price being financed through debt facilities. A pre-listing statement providing full details of the offering will be published in due course.

Citi has been appointed as Sole Global Co-ordinator, Sole Bookrunner, Sole Corporate Advisor and Lead Transaction Sponsor to the Company.

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