Property Flash


Transcend Residential’s investors should reject a takeover offer by Emira Property Fund, an independent board devised to assess the offer, said this week.

Emira, which owns Knightsbridge office park, Kramerville Corner and Boskruin Village Shopping Centre, has gradually been building its stake in Transcend as it increases its exposure to residential property. But many Transcend investors feel Emira’s offer isn’t fair.

Transcend said in stock exchange news service (Sens) statement that shareholders were referred to a firm intention announcement released on Wednesday, July 13 2022 where Transcend shareholders were advised of Emira’s firm intention to make a general offer to acquire up to 100% of Transcend’s ordinary Shares in issue, except those it doesn’t own already, for a cash consideration of R5.38 per Share on an ex-distribution basis.

Then on Tuesday, September 6 2022, Emira published the offer circular containing, among other things, terms of the offer and Emira’s rationale for making the offer. The offer is regulated by the Companies Act and the Takeover Regulations Panel (TRP). As required by TRP. An independent board including Robert Emslie, Faith Khanyile, Michael Falcone and Michelle Dickens was established in response to the firm intention letter to consider the offer and provide shareholders with its opinion.

The independent expert concluded that the fair value of a Transcend share lies between R6.00 and R6.60, with a likely value of R6.30.

“Having considered the terms and conditions of the offer, the independent expert has concluded that the terms and conditions of the offer are unfair and unreasonable to shareholders,” it said.

The independent board said it formed a view of a range of fair value of the shares on a liquidation basis which assumes that Transcend realises its direct property assets over time in an orderly manner, which implies cash back per share of R11.46 at a present value per share of R6.25 to R6.75, with a likely value of R6.50.

“The independent board, taking into account the independent expert’s report and its own analysis, has considered the terms and conditions of the offer and the offer consideration and the members of the independent board are unanimously of the opinion that the terms and conditions thereof are unfair and unreasonable to shareholders and unanimously recommends that eligible shareholders reject the offer,” it said.

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