Rebosis suffers another hit as Sanlam further reduces stake

Sanlam has more than halved its shareholding in Rebosis, dealing the debt-laden property fund another blow as it tries to regain the confidence of investors by selling assets to reduce debt.

The insurance giant, one of SA’s biggest institutional investors, brought down its stake in Rebosis A-shares from 10.96% to 4.69%.

Rebosis, which is led by founder Sisa Ngebulana, made the announcement on Tuesday, via the JSE’s stock exchange news service.

The news comes as the property firm, whose total value has plummeted from R9bn in 2017 to the current R229m, is negotiating a possible rescue deal with unnamed local and international investors.

The company’s share price has been plummeting into the low cents over the past three to four years and has not shown any sign of recovery.

It has also seen executives leave suddenly. Chief investment officer Rob Becker left in November 2020 while Marelise de Lange and Isabeau King had short stints in the role of chief financial officer.

Rebosis — whose shares rose 14.38% to 30c on Tuesday, its largest one-day gain in about four months — has a dual-share structure, which is designed to serve investors with different risk profiles. The investors are rewarded differently.

A-linked shareholders receive whatever is the lower of the prevailing consumer price inflation rate or 5% and are paid first. B-linked shareholders are paid whatever is left, with no limit on the potential amount of the payout.

Sanlam has been steadily selling out of Rebosis. At the end of 2020, its A shareholding was on 10.96%. Its holding of B shares has dropped to less than 2%, from 17.9% over the same period.

After Sanlam’s sale, Rebosis’ largest A shareholders are Citax Investments and Zacacode, each with 28.86%. Citax is financed by businessperson Zunaid Moti while Zacacode represents Ngebulana’s interests.

Moti has in the past tried to negotiate with Rebosis’s largest funder, Nedbank, to restructure its debt.

Its largest B shareholders are Citax Investments and the Public Investment Corporation, which hold 24.99% and 20.66%, respectively. Nedgroup Investments owns 6.82%.

The Amatolo Family Trust, which represents Ngebulana, owns 2.7%, while the Billion Group, his private development business, owns 2.52%.

Rebosis announced in April that it was in talks with local and offshore investors about a deal, which Ngebulana said were about reducing its debt.

In its results for the six months to the end of February, Rebosis said its loan-to-value (LTV) was 72.2%. LTV measures a property fund’s debt relative to the value of its asset portfolio. Fund managers advocate that LTVs should not exceed 40% as a prudent ceiling.

Rebosis, which owns a mix of shopping malls and offices, the majority of which are leased to the government, reduced its debt to R9.5bn from R9.6bn in the six-month period.

Its properties are valued at R13.1bn and include Baywest Shopping Centre in Port Elizabeth and Forest Hill Shopping Centre in Centurion.

andersona@businesslive.co.za