Arrowhead Properties, said yesterday it has reached an agreement to acquire Indite Property Fund, a 100% black owned and black managed property company, in what makes for an interesting black economic empowerment (BEE) arrangement.
The transaction introduces a new BEE name into the mainstream property investment sector which joins a couple of other names which have exploded into the mainstream over the past few years. These will include Sisa Ngebulana’s Billion Group, Saul Gumede’s Dipula, Vunani and lately Sandile Nomvete’s MPI/Delta.
Indite features Thomas Matlala as CEO of Indite Manco and brings into the Arrowhead fold six buildings with a combined gross lettable area of 17000m2 located in Gauteng, Free State, Kwa Zulu Natal and the North West Province.
The JSE listed property fund, Arrowhead, will take over 100% ownership of the Indite property portfolio for a total purchase consideration of R178 million which will be settled with a combination of Arrowhead units and cash.
Arrowhead added that upon finalisation of the transaction, it will transfer its government tenanted buildings, valued around R390 million, into the Indite portfolio which will be externally managed by a 100% black-owned asset manager, Indite Manco. “This will enable Indite Property Fund to enter into longer term leases with Government”.
Imraan Suleman, CFO of Arrowhead said this transaction shows the Company’s commitment to meet the provisions of the Property Charter in the areas of ownership, executive management, procurement, transfer of skills as well as enterprise development.
“We will continue to strive for transformation in South Africa and to promote a vibrant growing property sector. In addition, this acquisition will further our objective of acquiring well located and tenanted properties, on a yield enhancing basis” he said.
Thomas Matlala, CEO of Indite Manco commented, “Together with Arrowhead, we see a great opportunity to grow Indite aggressively in the government and parastatal market.
We are well positioned to capitalise on many opportunities in this growth sector by developing our niche strength as a 100% black-managed property fund”.