The Competition Commission has approved the sale of two malls in South Africa – in Cape Town and Johannesburg.
In its latest rulings, the commission approved the sale of both the 67,500 square-metre Table Bay Mall in Cape Town to Hyprop, as well as the 73,000 square-metre Mall of the South in Joburg south to Redefine.
In October 2023, Hyprop said that it would acquire 100% of the commercial letting enterprise and the solar panel installation being installed at Table Bay Mall for R1.625 billion.
Hyprop said that the rationale for the purchase was the mall’s strong growth potential.
The mall is situated in Sunningdale, inland from Blouberg and Big Bay, and is expected to see above-average growth due to the residential devolpment that is partly driven by semigration to the Western Cape.
The centre is positioned in a high-growth node with the area near the mall expected to see the construction of 5,000 to 7,500 more residential units over the next five to ten years.
The commission said that the purchase is unlikely to substantially lessen or prevent competition in any market. There were also no public interest concerns raised – thus it has recommended that the Competition Tribunal approve the transaction without conditions.
The commission also recommended that the Competition Tribunal approve the proposed transaction whereby Redefine intends to fully acquire the Mall of the South from joint-owner, RMB.
The over 67,000 sqm mall is currently 80%-owned by RMB Investment and Advisory (RMBIA) and 20% by Redefine. The mall is a super-regional retail centre situated at the corner of Swartkoppies Road and Kliprivier Drive, in the south of Johannesburg, Gauteng.
The full takeover of the mall by Redefine is not a traditional sale, but rather the completion of terms between the companies when the mall was acquired from Zenprop back in 2020.
In 2020, RMB advanced a term and revolving facility to the maximum amount of R1.82 billion for the outright acquisition of the mall from Zenprop Property. Under the purchase, Redefine provided property management services to the mall.
As per the purchase, Redefine issued a put option (shares), whereby RMB would have the option to sell its shares in the mall to Redefine and put option (claims) to First Rand (RMB’s owner), whereby First Rand would have to right to sells its rights and obligations to Redefine.
RMB exercised this option, which required Redfine to buy RMBIA’s 80% shareholding – taking full control over the mall.
The mall will continue to be operated by Redefine as a going concern from the date of the acquisition.
Much like Table Bay Mall, the Competition Commission said that the proposed transaction is unlikely to prevent competition issues, while there are also no public interest concerns.
Source: Business Tech