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Menlyn, Cavendish malls strike R10bn deal

Johannesburg - Old Mutual [JSE:OML] and Pareto Limited entered into an asset swap transaction that involves Menlyn Park in Pretoria and Cavendish Square in Cape Town, the companies said.

Old Mutual and Pareto announced the R10bn deal in a joint statement.

The transaction was subject to Competition Authority approval and other conditions associated with a transaction of this nature.

The asset swap would mean Pareto would acquire the 50% share of Menlyn shopping centre it did not already own from Old Mutual. Old Mutual would acquire the 50% share of Cavendish it did not own from Pareto, with the net consideration payable in cash.

Old Mutual Property managing director Peter Levett said the asset swap was beneficial for both companies. He said the decision was based on ensuring optimal growth in their respective property portfolios.

"We are very pleased with this value enhancing, which gives us outright ownership of a key retail centre, Cavendish, and enables us to access additional development opportunities within our portfolio," he said in a statement.

For the past five years, Old Mutual and Pareto have equally owned the two malls.

Menlyn was undergoing a development upgrade and together these assets represent around R10bn of prime retail property investment.

Pareto CEO Marius Muller said they were thrilled with the transaction.

"Menlyn Park shopping centre is an unrivalled retail property that is an ideal fit for Pareto's portfolio, especially as its current R2bn redevelopment project reflects Pareto's strategy of adding value to our assets," he said in a statement.

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