RMB assists Liberty Two Degrees in buy-out by Liberty

MEDIA RELEASE

20 NOVEMBER 2023

Liberty buys out Liberty Two Degrees minority shareholders

Liberty Group Limited (Liberty), part of the Standard Bank Group (SBG), is bringing Liberty Two Degrees Limited (L2D) fully back into the group after seven years of a separate listing on the Main Board of the JSE, with RMB acting as sole financial adviser and transaction sponsor to L2D for this transaction.

Liberty is one of South Africa’s leading long-term insurance providers and is a wholly owned subsidiary of SBG. Liberty currently holds approximately 61% of L2D shares (excluding treasury shares), and L2D is the co-owner, alongside Liberty, of a portfolio of 15 properties: seven retail, five specialised, two hotels and one office, with an aggregate value of R8.2 billion as at 31 December 2022.

L2D listed on the JSE in 2016 as an ungeared collective investment scheme in property and was subsequently converted to a corporate Real Estate Investment Trust (REIT). In 2018, L2D internalised its asset management function to be better positioned relative to its peers. Despite L2D’s portfolio of iconic properties (including Sandton City and Melrose Arch) and market-leading operational performance, its listing remained challenging, with multiple factors affecting JSE-listed shares in general and listed property shares in particular.

On 27 July 2023, Liberty announced its intention to buy out the minority shareholders in L2D at a price of R5.55 per share, which represented a substantial premium to the L2D share price. In addition, L2D shareholders will be entitled to receive the L2D ordinary dividend for first half of FY23 and a clean-out distribution upon closing of the transaction. On 22 September 2023, the transaction was approved by an overwhelming majority of L2D shareholders.  

Amelia Beattie, Chief Executive of L2D, says: “This transaction showcases the value that L2D continues to bring in corporate South Africa. We are excited for the future, being part of Liberty and the greater Standard Bank Group, while creating value for a broader stakeholder base. This is a milestone in the life of L2D, and the expertise of RMB as our advisors has served us well. The value provided by RMB in their seamless delivery created ease in the areas of complex regulatory requirements, and the deep technical nature involved in such a transaction. We thank RMB for their efficiency and guiding our Board to the successful conclusion of this process.”

“RMB has demonstrated its ability to deliver seamless execution, working closely with the L2D independent board to guide them through the complexities inherent in a transaction of this nature. The result is one that ultimately achieves the key objectives of L2D’s multiple stakeholders,” concludes Thabo Ndimande, Corporate Finance Executive at RMB.

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