Third-biggest property fund listed on the Johannesburg Stock Exchange,Hyprop, has agreed to buy 87 percent of the issued shares in African Land Investments for R768 million ($75.3m) after the investment company failed to proceed with its proposed listing on the JSE or Lusaka Stock Exchange.
Attacq, previously Atterbury Investment, will also acquire 12.4 percent of the issued shares of African Land Investments for R110m ($11m) while African Land CEO, Kevin Teeroovengadum will own 500,000 shares in the company.
African Land, which owns the 44,000m² Manda Hill shopping centre in Lusaka, Zambia (the largest mall in sub-Saharan Africa outside South Africa), will continue as a separate property entity with Teeroovengadum remaining as Chief Executive.
As the CEO, Teeroovengadum will help to grow the company’s portfolio through well-considered acquisitions of predominantly existing retail properties in carefully selected areas while offering above-average rental returns within the sub-Saharan African region outside South Africa.
Hyprop, as the largest buyer is committed to invest R750 million ($74m) over the next five years.
The surprise buyout by Hyprop Investments and recently listed developer – Attacq taunted investor’s expectation in seeing African Land Investments getting listed by the end of this year – an effort that would have made it the only JSE listing to focus exclusively on African real estate markets.
Hyprop entered the African market in August last year in a joint venture with Attacq through Atterbury Africa, which owns stakes in the Accra Mall and West Hills Mall in Ghana. The property-fund company which bought a 37.5 percent (R337m -$33m) stake in Atterbury Africa also owns landmark malls such as Cape Town’s Canal Walk and the Rosebank Mall in Johannesburg.
Hyprop’s chief executive, Pieter Prinsloo, said the African Land acquisition was an attractive investment that will support Hyprop’s strategy of investing in high quality shopping centres across the continent.
“African Land’s strategy of acquiring existing income-producing properties supports Hyprop’s strategy and will provide Hyprop with geographical diversification, as well as further investment opportunities in Africa.”
“The deal will provide Hyprop with geographical diversification as well as further investment opportunities in Africa and will also complement Hyprop’s existing partnership with Attacq in Atterbury Africa, which focuses mainly on new developments,” he added.
Teeroovengadum, on his part, said the investment by Hyprop and Attacq demonstrated the strength of the African Land story and growing stature of the sub-Saharan African real estate market.
“We are delighted to have attracted investors of this calibre. The expertise and networks they bring will strengthen our efforts to meet African Land’s vision,” he said.
