Johannesburg Stock Exchange listed property company, Arrowhead, will increase its market capitalisation more than 150 percent.
Based on a combined A and B unit closing price on Friday 6 July 2012 of around R11.75, the current market capitalisation will be in excess of R2 billion – a 150 percent increase within the first year as a public company.
This follows a strong acquisition drive.
Since listing in December 2011, Arrowhead has acquired an aggregate portfolio of 16 properties with a combined market value of over R820 million.
Mark Kaplan, chief operating officer, says since listing and once the properties have transferred, they would have grown the value of the property portfolio to over R2.3 billion.
“These acquisitions are in line with our strategy to own a diversified portfolio of high yielding properties.
“The acquisitions will be funded through the issue of Arrowhead A and B linked units, which should significantly enhance Arrowhead’s liquidity.”
Kaplan says the company’s market capitalisation at listing in December 2011 was just under R800 million.
Based on a combined A and B unit closing price on Friday 6 July 2012 of around R11.75, the current market capitalisation will be in excess of R2 billion – a 150 percent increase within the first year as a public company.
“With a 29 percent loan to value ratio once these acquisitions are implemented, we still have significant headroom for growth,” says Kaplan.
Arrowhead has recently obtained Competition Commission approval to acquire a portfolio consisting of eight commercial buildings from Growthpoint Properties for R167.6 million.
The buildings are located in Sunninghill Sandton, Bruma Johannesburg, Fourways Sandton, CBD Pretoria, Goodwood Cape Town, Meyersdal Alberton, Westville Durban and Bryanston Sandton measuring, in total, 16 699 square metres.
In the seven months since listing, Arrowhead concluded the following revenue enhancing acquisitions:
1. Midtown Mall, located in the Rustenburg CBD, measuring 16 903 square metres at a total value of R178 million
2. An office property located in Rivonia Sandton, measuring 2 926 square metres at a total value of R28.7 million
3. An office property located in Selby Johannesburg, measuring 8 722 square metres at total value of R112 million
4. Two shopping complexes located in Tsolo and Sterkspruit, measuring a total area of 11 517 square metres at a total value of R70.5 million
5. An industrial property located in Boksburg, measuring 11 177 square metres at a total value of R60 million
6. An industrial property located in Blackheath Cape Town, measuring 15 450 square metres at a total value of R41 million.
Two of the current acquisitions, with an aggregate value R165 million, are at advanced stages of negotiation.
Five properties that were acquired from Redefine, for an aggregate purchase consideration of R87.96 million and which could not be transferred at the time of listing, have since been acquired with the issue of Arrowhead units.
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