Turnstar, the BSE listed property outfit, put smiles on the shareholder faces on Monday when it announced the completion of the acquisition of the Mlimani City, an upmarket shopping complex in Tanzania.
The move means the company is also withdrawing the cautionary announcement it issued in July 2011.
Last week, Turnstar said the Tanzanian Competition Commission gave the deal the go ahead.
Managing Director of the company, Jacob Motlhabane, in an update published on the Botswana Stock Exchange (BSE) website praised the deal saying it allowed Turnstar to expand its presence into one of the strongest growing markets in Africa with a truly unique asset that is the premier retail destination in Tanzania.
“We are grateful for the support from our existing and new shareholders which has enabled us to accomplish such an extraordinary milestone in the history of Turnstar,” Motlhabane said.
“The Board and management are excited about the Mlimani transaction, as it represents a tremendous opportunity, not only to strategically enhance shareholder value and strengthen our competitive market position but also represents a catalyst for the transformation of Turnstar into a Pan-African property champion,” he added.
The transaction gives the Botswana company operational control of the highly regarded property asset anchored by high quality retail and office tenants which is expected to enhance the rental yield, distribution yield, geographic diversification and the overall quality of Turnstar’s property portfolio.
The transaction is partly financed through a rights issue and US$33.5 million (about P240 m) loan from Barclays Bank of Botswana.
According to Turnstar, rights Offer Linked Units available for subscription is 108,784,884, but only 32,380,207 rights Offer Linked Units were taken-up in the Rights Offer (including excess applications).
This means 76,404,677 in rights Offer Linked Units were issued to the Underwriter to settle the remainder of the Rights Offer consideration.
In total, 186,343,024 new linked units have been listed pursuant to the Mlimani transaction, comprising 77,558,140 linked units issued to the Vendors to settle $20 million (about P143.9 m) of the total purchase consideration and a further 108,784,884 linked units issued to Unitholders and Underwriters as part of the Rights Offer.
Accordingly the total Turnstar linked units in issue following the Mlimani transaction will be 572,153,603.
Turnstar was trading at 128 thebe per share on Monday unchanged from Friday.