In a significant development for South Africa’s commercial landscape, the Competition Tribunal has granted unconditional approval for the complete acquisition of the Mall of the South in Johannesburg by Redefine Properties. This approval marks a pivotal moment in the evolution of one of the country’s prominent retail hubs.
The transaction, which received the nod from the Competition Commission last week, finalizes Redefine’s acquisition of the remaining stake in the Mall of the South from its joint-owner RMB Investment and Advisory (RMBIA). This move solidifies Redefine’s position as the sole proprietor of the expansive 67,000 square meter super-regional center.
Previously, the Mall of the South stood as a joint venture, with RMBIA holding an 80% ownership stake and Redefine owning the remaining 20%. However, with this recent approval, Redefine assumes full control over the property, signaling a strategic shift in the dynamics of the retail real estate sector in South Africa.
This transaction comes as a culmination of agreements between the involved parties, following the initial acquisition of the mall from Zenprop Properties in 2020. At that time, RMB extended substantial financial support, providing a term and revolving facility amounting to R1.82 billion to facilitate the outright purchase of the mall from Zenprop Property.
As part of the acquisition deal, Redefine is slated to take over property management responsibilities for the Mall of the South, underscoring its commitment to optimizing operational efficiency and enhancing the overall shopping experience for patrons.
In addition to the straightforward acquisition of ownership, the agreement also includes a put option mechanism. This provision allows RMB the flexibility to sell its shares in the mall to Redefine at a future date, further streamlining the ownership structure and ensuring a seamless transition of control.
Furthermore, the transaction encompasses a put option related to claims, offering First Rand, the parent company of RMB, the opportunity to transfer its rights and obligations to Redefine. This strategic maneuver aligns with the broader objectives of consolidating ownership and fostering a conducive environment for sustained growth and development within the retail sector.
With RMB having exercised its put option, Redefine is now tasked with acquiring the remaining 80% shareholding of the Mall of the South, thereby consolidating its ownership and affirming its commitment to the property’s ongoing success as a thriving commercial hub.
The acquisition, set to take effect immediately upon completion, underscores Redefine’s strategic vision and reinforces its position as a key player in South Africa’s real estate landscape. By leveraging its extensive experience and expertise in property management, Redefine aims to elevate the Mall of the South to new heights of excellence, catering to the diverse needs and preferences of South African consumers.
As the retail sector continues to evolve and adapt to changing market dynamics, this acquisition sets the stage for a new chapter in the Mall of the South’s storied history. With Redefine at the helm, the future looks promising for this iconic shopping destination, promising continued innovation, growth, and success in the vibrant tapestry of South Africa’s commercial landscape.
