Story audio is generated using AI
Balwin Properties is moving closer to leaving the JSE after shareholders overwhelmingly backed a R1.1bn buyout that will take South Africa’s largest sectional-title developer private.
Shareholders representing about 79% of eligible voting rights participated in a meeting on Monday with 98% of votes cast in favour of the deal, clearing the way for the proposed transaction to proceed.
The transaction will see a consortium including the Public Investment Corporation (PIC), acting on behalf of the Government Employees Pension Fund (GEPF), and Balwin’s founding investors acquire about 49.7% of the company at R4.35 a share.
The deal values Balwin’s equity at about R2.26bn.
The vote comes as Balwin has faced limited liquidity in its shares, which have traded at a sustained discount to the underlying value of the business. The company has also pointed to the costs of maintaining its listing.
Balwin CEO Steve Brookes said the strong shareholder support reflected recognition of the value and immediate liquidity offered by the deal.
“The scale of support received from our shareholders is deeply encouraging. It demonstrates strong recognition of the value and immediate liquidity offered by the transaction and gives Balwin a clear mandate to begin its next chapter,” Brookes said.
He said private ownership would give the company greater flexibility to pursue its long-term growth strategy, backed by shareholders with a longer-term investment horizon.
“Balwin’s listing has played an important role in the company’s development. However, we believe private ownership, supported by the GEPF and our existing reinvesting shareholders, will provide the long-term alignment and flexibility required to pursue our growth objectives,” Brookes said.
The scale of support received from our shareholders is deeply encouraging.
— Steve Brookes, Balwin CEO
The next step is for the remaining conditions to be met, after which the transaction is expected to be implemented in October. Trading in Balwin shares is expected to be suspended on October 14, with the delisting from the JSE and A2X expected to take effect on October 20.
Once the deal is completed, the GEPF is expected to hold about 49.3% of Balwin through Bidco, alongside the company’s founding investors.
Brookes said the company remained committed to South Africa despite its departure from the public markets.
“Balwin remains proudly South African and deeply committed to this country, and we look forward to a great future with our new partners, the PIC,” he said.
The buyout comes as residential developers face a tougher market, with subdued housing demand, affordability pressures and rising construction costs weighing on the sector.
Balwin’s move to go private marks a shift towards longer-term ownership, allowing the developer to focus on growth without the costs and constraints of being publicly listed.
Business Day
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.