Property group Attacq has sold its stake in MAS Real Estate for nearly R800m, further bolstering its capital structure after reducing its debt pile by about R2.5bn at the end of December.
On Tuesday, Attacq said the sale of its remaining interest in MAS for R773m was a strategic decision “taken in accordance with Attacq’s capital allocation framework over its assets of which it has significant influence over.”
CFO Raj Nana said the implementation of the R2.7bn Waterfall City transaction with the Government Employment Pension Fund (GEPF) in 2023 bolstered the group’s balance sheet.
“Our strong balance sheet was bolstered with the proceeds from the Waterfall City transaction with the GEPF of R2.7bn, which was used to reduce interest-bearing debt to R5.9bn (June 2023: R8.4bn), resulting in an improvement in the interest cover ratio to 1.93 times,” Nana said.
“The impact of this transaction was only included for the final two months of this six-month reporting period and will have a larger impact on the full year results ending June 30 2024, when it will be included for eight of the 12 months.
“For the full year, we have revised our DIPS [distributable income per share] growth guidance upward to between 10.0% and 12.5%. This also considers the disposal of the group’s shares in MAS, which will be invested in income generating activities within the group.”
In September, Attacq’s shareholders voted in favour of the deal between it and the GEPF, giving the company financial muscle to unlock development opportunities at Waterfall City
The deal saw The GEPF, represented by the Public Investment Corporation (PIC), acquire a 30% stake in Attacq Waterfall Investment Company (AWIC) — a wholly owned subsidiary of Attacq.
Looking at its interim results, Attacq said group gearing decreased to 25.3% from 37.3% in the six months to end December, while occupancy increased to 93.7%.
Attacq reported rental income growth of 9.6% to R1.3bn in the period under review.
CEO Jackie van Niekerk said the group had development activity (under construction and approved pipeline) at Waterfall City of R1.4bn, while the company was making inroads in the logistics industry.
“This has been an excellent half-year for Attacq, closing out key strategic transactions to ensure a sustainable capital structure. Our diverse precinct strategy continues to be well executed, with high occupancy and collection rates respectively of 93.7% and 99.7%, emblematic of the high demand for our quality retail and logistics spaces,” she said.
“Our flagship residential development Ellipse continues to attract investor interest with excellent sales recorded during the period. Furthermore, our well-located office assets are home to numerous global blue-chip companies, including iconic brands such as DP World, Eppendorf, Dell, Estee Lauder, Pfizer, Ericsson, Dimension Data and Accenture.”
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