Redefine Properties Ltd. raised its offer for Fountainhead Property Trust after a money manager said the first bid by the South Africa real estate company would dilute its clients’ income from their investment.
Redefine, based in Johannesburg, offered 56 of its shares and 4.5 Hyprop Investments Ltd. shares for every 100 Fountainhead units, the bidder said in a statement today. Redefine owns 11 percent of Hyprop.
“The amended proposal is approximately 6 percent higher than the original proposal and contains a higher proportion of Hyprop units,” Redefine said in the statement.
The company’s shares rose 1.8 percent to 9.75 rand by 5:15 p.m. in Johannesburg. About 7.5 million shares changed hands, more than double the daily average over the past three months. Redefine has gained 31 percent this year compared with a 21 percent rise in the FTSE/JSE Africa All Share Index.
Fountainhead would remain listed on the Johannesburg exchange after the takeover “to seed a new portfolio” of properties that will conform to the government’s policy of black ownership, Redefine said. Fountainhead, Hyprop and Redefine own shopping centers and office parks in Africa’s largest economy.
Redefine made its first bid for some of Fountainhead’s assets in March. Oasis Group Holdings, a Cape Town-based money manager, advised clients at the time not to support that plan.