BEE consortium acquires 26% of Pinnacle Point Holdings
News > news - 24 Oct 2006
A consortium that includes mining magnate Lazarus Zim has acquired a 26% stake in Cape based national property group Pinnacle Point Holdings in a R220m deal that positions the national property group among the leading black economic empowerment companies in the industry.

The transaction, according to a company media release, has been facilitated by Nedbank Corporate. Pinnacle Point Holdings has its head office in Cape Town with regional offices in Johannesburg and Port Elizabeth.

In a coup for the burgeoning South African property market, Zim has been appointed a director of Pinnacle Point Holdings. The transaction is effective immediately, all due diligences having been completed.

In terms of the deal, Unipalm Investment Holdings will hold the major shareholding in the BEE consortium. Unipalm is a black-owned and managed investment company.

Pinnacle Point Holdings Chairman Ivor Stratford said although the deal was in line with the property charter, the essence was a partnership with a sound focus on property development. Both sides have the potential to bring viable deals to the table. It was the intention to expand not only in South Africa but also Africa and the neighbouring islands in line with Pinnacle’s proven track record.

He believed the move reflected the willingness of the industry to forge mutually beneficial BEE partnerships that would revitalise and grow the sector.

In separate transactions last year Unipalm acquired a stake in listed property company Growthpoint and recently acquired 25% of Sahara Computers, a South African subsidiary of the large Indian software conglomerate controlled by the Gupta family.

The Unipalm shareholders include a national broad-base of 35000 people with a strong rural and urban participation and the company has investment in agriculture, media, tourism, engineering, professional services and property. Ragavan Moonsamy, CEO of Unipalm, sees the investment as an exciting step forward in a growing sector of the market.

Stratford said the partners already have experience in property development in Mauritius, Seychelles and Kenya that Pinnacle Point Holdings could mobilise, while local market opportunities include meeting the demand for retirement villages and affordable housing as well as further expanding in the leisure area.

In the past two years Pinnacle Point Holdings has generated more than R2bn in sales, developing eight projects that CEO Ashley Stone said were “changing the way lifestyle developments are constructed by thinking out of the box”.

In this way, Pinnacle Point Holdings has carved a niche in the development of golfing and residential estates throughout South Africa, becoming the largest golf course developer in the country.

The jewel in the crown is the multi-billion rand Pinnacle Point Beach and Golf Resort near Mossel Bay, constructed dramatically on the cliffs overlooking the Indian Ocean.

The leisure and residential development that includes a golf course already noted by the golfing media as being among the leading courses in the world, has preserved and rehabilitated large areas of fynbos previously invaded by alien vegetation.

Amongst some for the group’s current developments is a R3bn new suburb outside Pietermaritzburg in a bid to ease the pent-up demand for affordable housing and retirement facilities within the provincial capital.

It is also currently developing a similar major residential development in Bloemfontein and has golf resorts under construction in Port Elizabeth and Clarens.

The group is also developing a seaside resort at Romansbaai near Hermanus, and retirement villages in various stages of completion in Mossel Bay, Bloemfontein, Port Elizabeth and Clarens. PPH also has commercial properties within its property stable. The current projects have projected sales values of over R8bn.

Zim said his consortium had been looking to acquire a major interest in the property development industry and Pinnacle Point Holdings provided the ideal platform with its experience and focused infrastructure which could assess and bring to fruition multiple development opportunities. He was also impressed with the quality of its current developments around the country and dedicated management team.

He foresaw the possibility of a listing on the JSE and plans to use Pinnacle Point as his property vehicle to expand into Africa and capitalise on other opportunities that he has been offered in the property field.
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