Emira builds 23.5% stake in Octodec as Wapnick family doubles down on Pretoria
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Emira Property Fund has accumulated a 23.5% stake in Pretoria-focused REIT Octodec Investments after a R892 million buying spree, while the controlling Wapnick family is backing the inner-city portfolio.
Emira Property Fund has built a 23.5 per cent stake in Octodec Investments after its voluntary offer closed well short of its target, while the Wapnick family that controls the Pretoria-focused real estate investment trust continues to back its inner-city portfolio.
On April 13, Emira disclosed that its wholly owned subsidiary Freestone Property Investments had bought 53,698,356 Octodec shares, or 20.17 per cent of the company, for R891.77 million in a series of off-market transactions. The sellers were institutional fund managers including Abax, Sanlam and Old Mutual Investment Group.
Emira then launched a voluntary offer for a further 39.2 million shares at 1,675 cents each in cash, which would have taken it to 34.9 per cent, just below the 35 per cent threshold in South Africa's Companies Act at which a buyer must offer to purchase every remaining share. Octodec's board refused to co-operate, saying publicly that the price undervalued the company.
The offer closed on May 14, lifting Emira to 23.5 per cent rather than 34.9 per cent. James Day, Emira's chief executive, said he was pleased to have surpassed the goal of a strategic 20 per cent stake.
Octodec is the only JSE-listed real estate investment trust focused exclusively on Gauteng, owning 246 properties, roughly two-thirds of them in Pretoria, including more than 100 buildings in the inner city that are being repurposed or redeveloped. The Wapnick family, led by chief executive Jeffrey Wapnick and chairman Sharon Wapnick, holds a stake in the company valued at around $108 million.
Emira has said it will engage with Octodec as a significant minority shareholder on ways to create value in the portfolio. Evan Robins, listed property portfolio manager at Old Mutual Investment Group, has said it is possible Emira will raise its offer at some point.