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Web Exclusive: Old Mutual sells shopping centre stake for R2.5 bln
September 2, 2009
By Roy Cokayne
Old Mutual has sold half of its stake in the three local shopping centres to the Eskom Pension and Provident Fund and Public Investment Corporation (PIC) for almost R2.5 billion, the company announced on Wednesday.
The shopping centres are the Menlyn park shopping centre in Pretoria and Cavendish Square and Connect shopping centres in Cape Town.
Ben Kodisang, managing director of Old Mutual Life Assurance Company of South Africa, said it was the largest local commercial property transaction since the sale of the Victoria & Alfred Waterfront (V&A).
The V&A Waterfront, owned by Transnet and its pension funds, was sold in 2006 for R7.04 billion to the Dubai World and London & Regional Properties consortium.
The transaction is subject to suspensive conditions, including the successful conclusion of the co-management agreement and regulatory approvals.
Pareto, on behalf of the Eskom Pension and Provident Fund and the PIC, have interests in seven other shopping centres.
It owns three centres, Cresta in Johannesburg, The Pavilion in Durban and Mimosa Mall in Bloemfontein.
It has a 25 percent stake in Sandton City, 67 percent in Southgate and 56 percent in Westgate, all of which are in Johannesburg, plus a 58 percent stake in Tyger Valley in Cape Town.
Alex Phakathi, Pareto’s managing director, said the transaction would be funded by a mix of debt and shareholder contributions.
Phakathi said Pareto and Old Mutual would consider expansion opportunities at Menlyn Park, without specifying how much, to improve the tenant mix.
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