Canal Walk and Hyde Park owner pulls out of major shopping mall deal
Hyprop has pulled out of its bid to acquire MAS after the company refused to release key documents.
Hyprop, which owns Rosebank Mall, Canal Walk and Hyde Park Corner, was attempting to purchase MAS, which owns malls in central and eastern Europe.
Hyprop offered MAS shareholders the opportunity to sell their MAS shares in exchange for Hyprop shares and/or for cash.
Hypop said that a development joint venture (DJV) with Prime Kapital, MAS’s largest shareholder and a rival bidder for MAS, is a point of contention with South African institutional investors.
Prime Kapital has openly criticised the bid from Hyprop. Its CEO, Martin Slabbert, was previously the CEO of MAS.
Hyprop said that a condition of its bid to acquire MAS depends on it getting access to the DJV.
This would allow Hyprop to assess the risks to MAS and Hyprop and to provide equal access and fair treatment to both Hyprop and Prime Kapital.
Hyprop requested a copy of the DJV agreements from MAS on top of the summary of the DJV that MAS provided on SENS earlier this month.
“As stewards of a listed company owing a duty of care to Hyprop shareholders, it is prudent for Hyprop to undertake its own due diligence on the agreements before proceeding with the bid.”
However, MAS refused to make the DJV agreements available without the consent of Prime Kapital, which it refused.
MAS did not provide Hyprop with any reasons for the refusal by Prime Kapital. “Such refusal by the MAS board and Prime Kapital is inexplicable,” said Hyprop.
“If the summary of the DJV agreements made available by MAS is complete and accurate, the DJV agreements are no longer confidential… and should be made available to Hyprop.”
The MAS board refused to disclose the DJV agreements to Hyprop, meaning that a material condition of the voluntary bid has not been fulfilled.
Despite approaching the JSE, Hyprop said the request is unlikely to be fulfilled.
The group believed its bid could create value for MAS shareholders, but has now terminated the offer as one of the non-negotiable conditions “will apparently not be fulfilled.”
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