RDI.L Regulatory News (RDI)

THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN ARE NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES, CANADA, AUSTRALIA, JAPAN OR ANY JURISDICTION IN WHICH IT WOULD BE UNLAWFUL TO DO SO. PLEASE SEE THE IMPORTANT NOTICE AT THE END OF THIS ANNOUNCEMENT.

THIS ANNOUNCEMENT IS AN ADVERTISEMENT FOR THE PURPOSES OF PARAGRAPH 3.3.2R OF THE PROSPECTUS RULES MADE UNDER PART VI OF THE FINANCIAL SERVICES AND MARKETS ACT 2000, AS AMENDED, AND DOES NOT CONSTITUTE A PROSPECTUS OR PROSPECTUS EQUIVALENT DOCUMENT. IT IS NOT AN OFFER FOR SALE OR SUBSCRIPTION OF, OR SOLICITATION OF ANY OFFER TO BUY OR SUBSCRIBE FOR, ANY SECURITIES IN REDEFINE INTERNATIONAL P.L.C. OR IN ANY OTHER ENTITY IN ANY JURISDICTION, INCLUDING TO U.S. PERSONS OR IN OR INTO THE UNITED STATES, CANADA, AUSTRALIA, JAPAN OR ANY JURISDICTION IN WHICH IT WOULD BE UNLAWFUL TO DO SO. THIS ANNOUNCEMENT IS FOR INFORMATION ONLY AND DOES NOT CONSTITUTE A RECOMMENDATION REGARDING ANY SECURITIES. NOTHING IN THIS ANNOUNCEMENT SHOULD BE INTERPRETED AS A TERM OR CONDITION OF THE POTENTIAL PLACING. THE DECISION TO CARRY OUT A PLACING HAS NOT BEEN TAKEN AND ANY DECISION TO PURCHASE, OTHERWISE ACQUIRE, SUBSCRIBE FOR, SELL OR OTHERWISE DISPOSE OF ANY POTENTIAL PLACING SHARES MUST BE MADE ONLY ON THE BASIS OF THE INFORMATION AND TERMS CONTAINED IN ANY ANNOUNCEMENT THAT A PLACING WILL BE CONDUCTED AND ANY INFORMATION IN INCORPORATED BY REFERENCE INTO THE FINAL PROSPECTUS TO BE PUBLISHED BY REDEFINE INTERNATIONAL P.L.C. (INCORPORATING A CIRCULAR FOR THE PURPOSES OF THE LISTING RULES OF THE UK LISTING AUTHORITY) (THE "PROSPECTUS") AND ANY SUPPLEMENT THERETO.

28 January 2016

REDEFINE INTERNATIONAL P.L.C.

("Redefine International" or the "Company")

(Registered number 010534V)

LSE share code: RDI

JSE share code: RPL

ISIN: IM00B8BV8G91

Potential Placing to raise minimum proceeds of £100 million

Approval of waiver of Rule 9 of the UK Takeover Code

Approval of the Related Party Transaction

and

Notice of Extraordinary General Meeting

Highlights:

· Potential Placing to raise gross proceeds in excess of £100 million to finance Tranche 2 of the transformational acquisition of the AUK Portfolio, as announced on 7 September 2015

· Tranche 2 of the Acquisition now comprises nine properties, at a reduced purchase price of £201.7 million (£210.2 million including costs), following the sale of 16 Grosvenor Street, London in December 2015 which generated a profit of £3.0 million pre completion

· The Combined AUK Portfolio would add £28.3 million of gross rental income with a WAULT to first break of 7.7 years

· Completion of the Placing and the Acquisition would create a portfolio valued at approximately £1.5 billion with a pro forma gross rental income of approximately £103 million completing a five year transformation of the Company

· The Combined AUK Portfolio offers a scalable opportunity to continue to deliver income focused returns throughout the property cyle. The portfolio comprises largely institutional quality assets which have strong property fundamentals and scope for adding capital value through active asset management. To date asset management efforts have largely been focused on letting of vacant space and lease renewals, which have exceeded management's initial expectations

· Redefine Properties has irrevocably agreed to subscribe for up to such number of Placing Shares at the Placing Price as equates to an aggregate amount of up to £70.0 million

· Subject to market conditions, the potential Placing is expected to take place post the results of the EGM in February and will be available primarily to institutional investors only

· The acquisition of the Combined AUK Portfolio (excluding 16 Grosvenor Street, London but including Banbury Cross Retail Park) comprises largely institutional quality assets across the UK, with significant scope for capital value and income growth through active asset management with the following key characteristics:

Figures as reported in the 2015 Annual Report excluding Grosvenor Street

Overview

Background to Placing

· On 7 September 2015, Redefine International, the FTSE 250 income-focused UK REIT, published a circular to announce the conditional acquisition of the AUK Portfolio for an aggregate consideration of £437.2 million (£455.7 million after costs)

· It also announced that it had exchanged contracts to acquire Banbury Cross Retail Park for a consideration of £52.5 million (£54.7 million including transaction costs) which completed that day

· Shareholder approval for the Acquisition was obtained on 25 September 2015

· Tranche 1 of the Acquisition, which comprised nine properties at a purchase price of £203.5 million (£212.1 million including costs), completed on 2 October 2015 and was funded with existing cash resources together with £155.0 million of bank debt

· Tranche 2 of the Acquisition, which now comprises nine properties (following the sale of 16 Grosvenor Street, London), requires total funding of £210.2 million (including transaction costs)

Potential Placing

· If the resolutions are passed at the EGM and the Company decides to proceed with the Placing, the Company intends to raise a minimum of £100.0 million (gross) through the Placing to complete the acquisition of Tranche 2, with the balance of the consideration being funded by existing cash resources and the AUK Facility

· The Acquisition is due to complete on or around 1 March 2016

· If the Placing proceeds and there is sufficient demand from Placees the Board may decide to increase the size of the Placing up to a maximum amount of £150.0 million

· The excess of up to £50.0 million would be used inter alia to provide capital for further disciplined asset management opportunities within the Group's existing portfolio as well as new investment opportunities. Additionally the excess equity raised would support refinancing and restructuring of the Group's existing facilities at lower leverage levels

· The Company holds a primary listing on the Official List and a secondary listing on the Main Board of the JSE. The potential Placing would take place in both the UK and in South Africa, with Redefine Properties retaining its current holding of 30.07 per cent in the Company (having committed to subscribe for up to £70.0 million pursuant to the RPL Equity Commitment)

· An illustrative timetable for the potential Placing is included at the end of this announcement

Pursuant to the Acquisition, Redefine International will publish a Prospectus later today in relation to the potential Placing. The Prospectus will contain a notice convening the Extraordinary General Meeting, at which resolutions will be proposed to (a) give the Directors authority to allot the Placing Shares on a non pre-emptive basis, (b) approve the waiver of Rule 9 under the UK Takeover Code and (c) approve the Related Party Transaction. If the Resolutions are passed at the Extraordinary General Meeting, and if the Board decides (in consultation with the Bookrunners) that it is appropriate to do so, then the potential Placing will be launched via an accelerated bookbuild following the Extraordinary General Meeting.

In accordance with LR 9.6.2 R of the UK Listing Rules, a copy of the Prospectus will be submitted to the UK's National Storage Mechanism later today and will be available for inspection at: http://www.morningstar.co.uk/uk/NSM and also on the Company's website, www.redefineinternational.com.

Mike Watters, Chief Executive, of Redefine International, said:

"The completion of the AUK Portfolio will represent another key milestone for Redefine International. Over the last five years we have overseen the successful transformation of the Company's corporate structure and asset base, significantly enhancing shareholder returns.

"We firmly believe that performance in the next phase of the property cycle will be primarily weighted towards income returns and rental growth, making our core strategy of recycling capital into assets which display strong income fundamentals and benefit from occupier demand, like those included in the AUK Portfolio, even more relevant. Tranche 1 of the AUK Portfolio has already exceeded expectations in terms of asset management opportunities and we are confident that completion of the acquisition of the remaining assets will provide us with the solid foundations to grow the capital value and income of our entire portfolio over the long term.

"Having carefully considered all funding options, we believe that this potential Placing would be in the best interests of Shareholders and the growth of the business as a whole."

Further enquiries:

Redefine International Tel: +44 (0) 20 7811 0100

Michael Watters

Stephen Oakenfull

Peel Hunt Tel: +44 (0) 20 7418 8900

Capel Irwin

Hugh Preston

Alastair Rae

J.P. Morgan Cazenove Tel: +44 (0) 20 7742 4000

Bronson Albery

Nicholas Hall

Tara Morrison

Anne Ross

Java Capital Tel: + 27 (0) 11 722 3050

Errol Germon

Gareth Earl

FTI Consulting Tel: +44 (0) 20 3727 1000

UK Public Relations Adviser

Dido Laurimore

Claire Turvey

Ellie Sweeney

FTI Consulting Tel: + 27 (0) 11 214 2402

SA Public Relations Adviser

Max Gebhardt

Trevor Jones

IMPORTANT NOTICES

This announcement is not a prospectus or a prospectus equivalent document but an advertisement and does not constitute or form part of, and should not be construed as, any offer for sale or subscription of, or solicitation of any offer to buy or subscribe for, any shares in the Company or securities in any other entity, in any jurisdiction, including the United States, nor shall it, or any part of it, or the fact of its distribution, form the basis of, or be relied on in connection with, any contract or investment decision whatsoever, in any jurisdiction. This announcement is for information only and does not constitute a recommendation regarding any securities. Investors should not subscribe for or purchase any Placing Shares referred to in this announcement, should the Placing proceed, except exclusively on the basis of the information contained in the separate announcement of the Placing and the Prospectus. No money, securities or other consideration is being solicited and, if sent in response to the information herein, will not be accepted.

Peel Hunt LLP ("Peel Hunt") which is authorised and regulated in the United Kingdom by the Financial Conduct Authority (the "FCA"), is acting as UK sponsor and joint UK bookrunner to the Company in relation to the potential Placing and no-one else and will not be responsible to anyone other than the Company for providing the protections afforded to clients of Peel Hunt nor for providing advice in relation to the potential Placing or any other matter referred to in this announcement.

J.P. Morgan Securities plc (which conducts its UK investment banking business under the name J.P. Morgan Cazenove) ("JPMC"), which is authorised in the United Kingdom by the Prudential Regulation Authority (the "PRA") and regulated by the PRA and the FCA is acting as joint UK bookrunner to the Company in relation to the potential Placing and no-one else and will not be responsible to anyone other than the Company for providing the protections afforded to clients of JPMC nor for providing advice in relation to the potential Placing or any other matter referred to in this announcement.

Java Capital Proprietary Limited ("Java Capital") is acting as JSE sponsor, SA corporate adviser and SA bookrunner to the Company in relation to the potential Placing and no-one else and will not be responsible to anyone other than the Company in relation to the potential Placing or any other matter referred to in this announcement.

Aside from the responsibilities and liabilities, if any, which may be imposed under the Financial Services and Markets Act 2000 or the regulatory regime established thereunder, or any other applicable regulatory regime, none of Peel Hunt, JPMC, Java Capital or any of their respective affiliates accept any responsibility or liability whatsoever for, nor make any representation or warranty, express or implied, as to the contents of this announcement, including its accuracy, fairness, completeness or verification, or for any other statement made or purported to be made by it, or on its behalf, in connection with the Company or the potential Placing and nothing in this announcement is, or shall be relied upon as a promise or representation in this respect, whether as to the past or future. Each of Peel Hunt, JPMC and Java Capital and their respective affiliates accordingly disclaims to the fullest extent permitted by law all and any responsibility or liability whether arising in tort, contract or otherwise (save as referred to above) which they might otherwise have in respect of this announcement or any such statement.

This announcement and the information contained herein is restricted and is not for release, publication or distribution, in whole or in part, directly or indirectly, in or into the United States or to US Persons, Australia, Canada or Japan or any jurisdiction into which the release, publication or distribution would be unlawful.

This announcement is for information purposes only and does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any Placing Shares to any person, including those with a registered address in, or who is resident in, the United States or any other Restricted Jurisdiction or to US Persons (as such term is defined in Regulation S of the US Securities Act 1933, as amended (the "US Securities Act"). No placing or other offering is being made pursuant to this announcement and the Prospectus. No action has been taken by the Company or the Bookrunners that would permit an offering of such shares or possession or distribution of this announcement or any other offering or publicity material relating to such shares in any jurisdiction where action for that purpose is required. Any failure to comply with these restrictions may constitute a violation of the securities laws of such jurisdictions. Persons into whose possession this announcement comes are required by the Company and the Bookrunners to inform themselves about, and to observe, such restrictions.

Any potential Placing Shares have not been and will not be registered under the US Securities Act 1933, as amended (the "US Securities Act"), or with any regulatory authority or under the applicable securities laws of any state or other jurisdiction of the United States, or the relevant laws of any state, province or territory of any other Restricted Jurisdiction, or any other Restricted Jurisdiction, and may not be offered, sold, taken up, exercised, resold, renounced, transferred or delivered, directly or indirectly, within any Restricted Jurisdiction or within the United States (as defined in Regulation S under the US Securities Act ("Regulation S")) unless any offer and sale of Placing Shares has been registered under the US Securities Act or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the US Securities Act. Any potential Placing Shares would be offered or sold outside the United States in reliance on Regulation S. This announcement does not constitute an offer to sell or a solicitation of an offer to buy Placing Shares in any jurisdiction in which such offer or solicitation is unlawful. No public offering of the shares referred to in this announcement is being made in the United States, Australia, Canada or Japan or any jurisdiction in which such public offering would be unlawful. Neither this announcement, the Prospectus nor any other document connected with the potential Placing will be distributed in or into the United States or any of the other Restricted Jurisdictions.

The information in this announcement may not be forwarded or distributed to any other person and may not be reproduced in any manner whatsoever. Any forwarding, distribution, reproduction, or disclosure of this information in whole or in part is unauthorised. Failure to comply with this directive may result in a violation of the US Securities Act or the applicable laws of other jurisdictions.

This announcement includes statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements can be identified by the use of forward-looking terminology, including the terms "believes", "estimates", "plans", "projects", "anticipates", "expects", "intends", "may", "will", or "should" or, in each case, their negative or other variations or comparable terminology. These forward-looking statements include matters that are not historical facts. They appear in a number of places throughout this announcement and include statements regarding the current intentions, beliefs or expectations of the directors ("Directors") of the Company concerning, among other things, the Company's results of operations, financial condition, liquidity, prospects, growth, strategies and the Company's markets. By their nature, forward-looking statements involve risk and uncertainty because they relate to future events and circumstances. Actual results and developments could differ materially from those expressed or implied by the forward-looking statements. Forward-looking statements may and often do differ materially from actual results. Any forward-looking statements in this announcement are based on certain factors and assumptions, including the Directors' current view with respect to future events and are subject to risks relating to future events and other risks, uncertainties and assumptions relating to the Company's operations, results of operations, growth strategy and liquidity. Whilst the Directors consider these assumptions to be reasonable based upon information currently available, they may prove to be incorrect. Save as required by law or by the UK Listing Rules, UK Prospectus Rules, the Disclosure and Transparency Rules and the JSE Listing Requirements, the Company undertakes no obligation to publicly release the results of any revisions to any forward-looking statements in this announcement that may occur due to any change in the Directors' expectations or to reflect events or circumstances after the date of this announcement.

You are advised to read this announcement and the Prospectus and the information incorporated by reference therein in their entirety for a further discussion of the factors that could affect the Company or the Group's future performance and the industry in which they operate. In light of these risks and uncertainties, the events described in the forward-looking statements in this announcement may not occur.It should be noted that no decision to launch the Placing has yet been taken by the Company.

This announcement has been issued by and is the sole responsibility of the Company. No representation or warranty, express or implied, is or will be made as to, or in relation to, and no responsibility or liability is or will be accepted by Peel Hunt, JPMC or Java Capital or by any of their affiliates or agents as to, or in relation to, the accuracy or completeness of this announcement or any other written or oral information made available to or publicly available to any interested party or its advisers, and any liability therefore is expressly disclaimed. Neither Peel Hunt, JPMC nor Java Capital nor any of their affiliates or agents shall have any obligation to update this announcement or any additional information or to correct any inaccuracies in it which may become apparent.

Any indication in this announcement of the price at which Ordinary Shares have been bought or sold in the past cannot be relied upon as a guide to future performance. No statement in this announcement is intended to be a profit forecast and no statement in this announcement should be interpreted to mean that earnings per share of the Company for the current or future financial years would necessarily match or exceed the historical published earnings per share of the Company. The price of shares and any income expected from them may go down as well as up and investors may not get back the full amount invested upon disposal of the shares. Past performance is no guide to future performance, and persons needing advice should consult an independent financial adviser.

The contents of this announcement are not to be construed as legal, financial or tax advice. If necessary, each recipient of this announcement should consult his, her or its own legal adviser, financial adviser or tax adviser for legal, financial or tax advice. Each placee should consult with its own advisers as to legal, tax, business and related aspects of an acquisition of Placing Shares. 

This announcement is not being distributed by, nor has it been approved, for the purposes of section 21 FSMA by, a person authorised under FSMA. This announcement is being distributed and communicated to persons in the UK only in circumstances in which section 21(1) of FSMA does not apply. This announcement is being directed only at persons in the UK and outside of the UK (other than South Africa) who are persons in member states of the European Economic Area who are 'Qualified Investors' within the meaning of article 2(1)(e) of the Prospectus Directive (which means Directive 2003/71/EC and includes any relevant implementing directive measure in any member state). In addition, in the UK, this announcement is being directed only at Qualified Investors who (a) have professional experience in matters relating to investments and who fall within article 19(5) ("Investment professionals") of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the "Order"); or (b) are persons falling within article 49(2)(a) to (d) ("High net worth companies, unincorporated associations, etc") of the Order; or (c) are persons to whom it may otherwise be lawfully communicated. This announcement is being directed only at persons in South Africa envisaged in section 96(1)(a) and/or (b) of the South African Companies Act, 2008 (such persons being referred to as "South-African Eligible Investors"). All such persons contemplated in (a), (b) or (c) and the South-African Eligible Investors are together being referred to as "Relevant Persons"). This announcement must not be acted on or relied on by persons who are not Relevant Persons.

Neither the content of the Company's website (or any other website) nor the content of any website accessible from hyperlinks on the Company's website (or any other website) is incorporated into, or forms part of, this announcement.

Further details of the potential Placing:

1. INTRODUCTION

On 7 September 2015, Redefine International published a circular to announce the conditional acquisition of the AUK Portfolio for an aggregate consideration of £437.2 million (£455.7 million after costs) through its wholly-owned subsidiary, Redefine AUK. At the same time, the Company also announced that it had exchanged contracts on 4 September 2015 to acquire Banbury Cross Retail Park for a consideration of £52.5 million (£54.7 million including transaction costs). Shareholder approval for the Acquisition, which constituted a Class 1 transaction for the Company under Chapter 10 of the UK Listing Rules, was successfully obtained on 25 September 2015 at an extraordinary general meeting of the Company.

The acquisition of the AUK Portfolio was split into two tranches:

(a) Tranche 1, which was completed on 2 October 2015 and was funded with existing cash resources and £155.0 million of bank debt. The Tranche 1 acquisition comprised nine properties at a purchase price of £203.5 million (£212.1 million including costs).

(b) Tranche 2, which comprised 10 properties, is expected to complete on or around 1 March 2016 at a purchase price of £233.7 million (£243.6 million including costs).

Following this, on 21 December 2015, the Company announced the successful sale of 16 Grosvenor Street, London, which formed part of the Tranche 2 Properties, for £35.6 million. The disposal of 16 Grosvenor Street, which had an original apportioned purchase price of £29.0 million, resulted in the purchase price of the Tranche 2 Properties reducing from £233.7 million to £204.7 million. Adjusting for the profit of £3 million realised on the sale, the total cash consideration of £201.7 million (£210.2 million including costs). will be paid to complete Tranche 2. The sale of 16 Grosvenor Street sale represents just one of a number of significant value enhancing opportunities arising for the Company from the acquisition of the AUK Portfolio (and Banbury Cross Retail Park), and progress to date in the delivery of asset management initiatives on the overall portfolio has exceeded the Company's initial expectations. The early realisation of opportunities is encouraging and serves as immediate evidence of the solid foundation which the Board believes this transformational deal offers the Company, to continue to drive Shareholder value.

At the September EGM, the Shareholders (other than Redefine Properties and its associates) additionally approved:

· the related party transactions, pursuant to Chapter 11 of the UK Listing Rules, with Redefine Properties, regarding potential funding scenarios and the related fees (each as more particularly described in paragraph 5 of Part 4 of the Circular); and

· the Disposal, in the event that the Board considered that market conditions were not conducive to proceeding with an equity fundraise such that the terms of any equity fundraise were not considered by the Board to be in the best interests of existing Shareholders as a whole and the Board elected instead, having regard to the Company's overall level of gearing, to utilise and convert the RPL Loan into equity, in order to form a 50:50 joint venture in respect of the Combined AUK Portfolio. The Disposal would constitute a Class 1 transaction for the Company under Chapter 10 of the UK Listing Rules as well as a related party transaction for the purposes of Chapter 11 of the UK Listing Rules and approval for the Disposal (if the Company chose to implement it) was obtained at the September EGM. The RPL Loan and RPL JV will be described in more detail in paragraphs 21.5 and 21.6 of Part 15 of the Prospectus respectively.

After taking account of the disposal of 16 Grosvenor Street, London (as described above) and a maximum drawdown under the AUK facility of £98.0 million, approximately £112.2 million is required to complete the acquisition of the Tranche 2 Properties.

On a pro-forma basis, the Company is expected to have approximately £34.3 million of existing cash resources following the exchange of contracts on the sale of a portfolio of 10 petrol filling stations, which is anticipated to complete on 19 February 2016 and generate net proceeds of £6.6 million following the repayment of £5.2 million of debt. After taking into account committed and potential future cash requirements, the Company believes that minimum gross proceeds of £100.0 million must be raised to support the acquisition of the Tranche 2 Properties and to provide the Company with sufficient working capital. The Placing, if it were to proceed, would be on a non-pre-emptive basis, primarily to institutional investors only, and conditional on the Company raising minimum gross proceeds of £100.0 million.

For the Placing to proceed, all the Resolutions need to be approved, following which the Board will decide (in consultation with the Bookrunners) whether market conditions are conducive to proceeding with an equity raising to support the acquisition of the Tranche 2 Properties, or otherwise to utilise the RPL Loan (further details of which are provided in this paragraph 1 below).

In connection with the potential Placing, Redefine Properties has irrevocably agreed to subscribe for such number of Placing Shares at the Placing Price as equals an aggregate subscription amount of up to £70.0 million. The RPL Equity Commitment is subject to the Placing Price representing a minimum discount of five per cent. to the volume weighted average price of an Existing Ordinary Share over the 30 days prior to the date of announcement of any such Placing (the "Maximum RPL Price").

If the Placing proceeds and there is a successful procurement of Placees (other than Redefine Properties) representing in excess of £30.0 million of gross proceeds, the Board expects to scale back the Redefine Properties' maximum participation of up to £70.0 million on a pound for pound basis, for every pound raised from other Placees in excess of the additional aggregate £30.0 million, subject to Redefine Properties' entitlement to participate at the level which would maintain its current 30.07 per cent shareholding in the Company.

If the Placing proceeds and there is sufficient demand from Placees (including from Redefine Properties, to the extent that it seeks to participate in excess of its pro-rata entitlement in the Placing, subject to its terms and conditions), the Board may then decide to increase the size of the Placing up to a maximum amount of £150.0 million.

If the Placing proceeds, the Joint Bookrunners will be underwriting credit risk on the Placees under the UK Placing (other than Redefine Properties). Java Capital will not be underwriting credit risk on the Placees under the South African Placing. Accordingly, to the extent that South African Placees do not take up and pay for their allocation in full, the amount raised by the Company may be less than the amount announced as having been allocated. However, the Placing will be conditional on the gross proceeds received by the Company being £100.0 million or more.

The potential Placing requires the approval of Shareholders. The Directors' existing authority to allot shares on a non-pre-emptive basis, which was obtained by the Directors at the Company's annual general meeting on 26 January 2016, would not be sufficient to carry out the Placing. Accordingly, the Company proposes the Share Authority Resolutions at the EGM to give the Directors the authority to complete the Placing by dis-applying Shareholders' pre-emption rights.

In addition, as Redefine Properties is a substantial shareholder of the Company, its participation in the Placing would constitute a Related Party Transaction for the purposes of Chapter 11 of the UK Listing Rules. As such, the Related Party Transaction is conditional on the approval of the Related Party Independent Shareholders. Further, the issue of Placing Shares to Redefine Properties under the Placing would give rise to certain considerations under the UK Takeover Code. Accordingly, to the extent Redefine Properties (together with any other members of the Concert Party) acquires such number of Placing Shares under the Placing which increases its percentage shareholding in the Company, such subscription is conditional on the approval of the Rule 9 Independent Shareholders.

Accordingly, an Extraordinary General Meeting will be convened for 9.30 a.m. on 15 February 2016 at 2nd Floor, 30 Charles II Street, London, SW1Y 4AE. The notice convening the Extraordinary General Meeting will be set out at the end of the Prospectus and an explanation of the Resolutions to be proposed at the EGM is set out in paragraph 9 below.

As was approved by Shareholders in the September EGM, the Company retains the option to utilise the RPL Loan of up to £135 million to meet the funding requirement for the completion of the Tranche 2 Properties. The Company will utilise the RPL Loan in the event that the Resolutions are not passed by Shareholders or prevailing market conditions mean that the Board (in consultation with the Bookrunners) elects not to proceed with the Placing or if, inter alia, the Placing fails to raise gross proceeds of at least £100.0 million. In such circumstances, if the Company elects not to raise funds through a debt or equity fundraising prior to the repayment date of the RPL Loan, the Company may elect to convert the RPL Loan into a 50 per cent equity interest in Redefine AUK (or, in the absence of election by the date being three months following drawdown, it will automatically convert), thus creating a 50:50 joint venture between the Company and Redefine Properties resulting in the Disposal. However, if the Placing proceeds, the Company will use the proceeds of it to complete the acquisition of the Tranche 2 Properties without using the RPL Loan. The RPL Loan and the RPL JV will be described in more detail in paragraphs 21.5 and 21.6 of Part 15 of the Prospectus.

Outlined below is the background to and the reasons for the Placing, to explain why:

· subject to an assessment of market conditions following the Extraordinary General Meeting, the Board considers the Proposals to be in the best interests of the Company and Shareholders as a whole;

· the Board unanimously recommends that you vote in favour of the Share Authority Resolutions and the Related Party Resolution to be proposed at the Extraordinary General Meeting; and

· the Independent Directors, who have been so advised by Peel Hunt, consider the terms of the Placing to be fair and reasonable and in the best interests of the Rule 9 Independent Shareholders and the Company as a whole, and unanimously recommend that you vote in favour of the Rule 9 Waiver Resolution to be proposed at the Extraordinary General Meeting.

2. BACKGROUND TO AND REASONS FOR THE POTENTIAL PLACING

Given the expected completion date for Tranche 2 of 1 March 2016, the Board considered, at the time the Circular was published in September 2015, that raising funds significantly in advance of the completion date would have been an inefficient use of Shareholders' funds, and would have resulted in a temporary but significant dilution in earnings. The Board explained that it would consider raising the necessary funds closer to the timing for completion of Tranche 2, subject to prevailing market conditions and ensuring any fundraise would be in the best interests of Shareholders as a whole and having regard to the Company's overall level of gearing.

As was more particularly described in the Circular, the Company (through its wholly-owned subsidiary, Redefine AUK) also entered into a banking facility of £303.0 million with a syndicate of banks, being HSBC Bank plc, Barclays Bank PLC, Abbey National Treasury Services PLC and the Royal Bank of Scotland plc, conditional only on the Acquisition proceeding. The AUK Facility comprises a £155.0 million five-year term loan and a £148.0 million revolving credit facility expiring in 2020 which will be secured against the Combined AUK Portfolio, but will have no recourse to the Group (other than the Redefine AUK Group). The Circular explained the Company's intention to utilise approximately £270.0 million of the AUK Facility to fund the Acquisition, with the balance of the AUK Facility providing additional headroom and working capital flexibility to the Group and, subject to the terms of the loan, may be used to support future acquisitions. The AUK Facility has been structured in order to provide the Company with a more flexible funding structure and to accommodate alternative sources of debt funding in the future.

On 21 December 2015, the Company, jointly with the Seller, sold the property at 16 Grosvenor Street, London for £35.6 million. As was agreed at the time of the announcement of the Acquisition in September 2015, 16 Grosvenor Street was part of the Tranche 2 Properties and subject to a 50 per cent profit share if sold for more than £35.0 million. The sale, including profits realised, has reduced the consideration payable for the Tranche 2 Properties by £32.0 million to £201.7 million (£210.2 million including costs) and, in addition, has resulted in a net profit to the Group of £3 million.

The Company is actively reviewing its existing portfolio to identify assets which do not meet its strategic and financial criteria. As part of this review, the Company recently exchanged contracts on the sale of a portfolio of 10 petrol filling stations for £12.0 million, which is anticipated to complete on 19 February 2016 and generate net proceeds of £6.6 million following the repayment of £5.2 million of debt. The sales price reflects a 6.7 per cent premium to book value. The Company will continue to progress the disposal of other identified assets to support the Company's goal of managing financial leverage over time and recycling capital into value adding asset management opportunities.

The Company proposes to finance the acquisition of the Tranche 2 Properties through a minimum equity capital raise of £100.0 million, up to a maximum of £150.0 million, by way of the Placing.

At the September EGM, Shareholders (other than Redefine Properties and its associates) approved the RPL Equity Commitment, pursuant to which Redefine Properties irrevocably agreed to subscribe for up to £70.0 million in any equity capital raise undertaken by the Company to finance the acquisition of the Tranche 2 Properties (subject to the Placing Price being not more than the Maximum RPL Price). Accordingly, in connection with the potential Placing, Redefine Properties has irrevocably agreed to subscribe for such number of Placing Shares at the Placing Price as equals an aggregate subscription amount of up to £70.0 million.

The Company would seek to raise a minimum aggregate additional amount of £30.0 million from other Placees in order to raise a minimum of £100.0 million (gross) through the Placing, which would allow the Company to complete the acquisition of the Tranche 2 Properties. If the Placing proceeds and there is a successful procurement of Placees (other than Redefine Properties) representing in excess of £30.0 million of gross proceeds, the Board expects to scale back Redefine Properties' maximum participation of up to £70.0 million on a pound for pound basis, for every pound raised from other Placees in excess of the additional aggregate £30.0 million, subject to Redefine Properties' entitlement to participate in the Placing at the level which would maintain its current 30.07 per cent shareholding in the Company.

If the Placing proceeds and there is sufficient demand from Placees (including from Redefine Properties, to the extent that it seeks to participate in excess of its pro-rata entitlement in the Placing, subject to its terms and conditions), the Board may then decide to increase the size of the Placing up to a maximum amount of £150.0 million.

Further details on the potential Placing and the irrevocable commitment by Redefine Properties to subscribe for up to £70.0 million in equity are set out in paragraph 6 below.

3. USE OF PROCEEDS

The acquisition of the Tranche 2 Properties is due to complete on or around 1 March 2016 and requires total funding of approximately £210.2 million (including transaction costs). The Company has the ability to drawdown up to £98.0 million from its revolving credit facility secured against the Combined AUK Portfolio. After taking into account existing cash resources and working capital requirements, the Company requires a minimum additional amount of £100.0 million through the Placing.

As mentioned above, Redefine Properties has irrevocably agreed to subscribe for such number of Placing Shares under the Placing as equals an aggregate amount of up to £70.0 million. Redefine Properties' irrevocable commitment to subscribe for Placing Shares pursuant to the RPL Equity Commitment is conditional on the Placing Price being no higher than the Maximum RPL Price. The Company intends to raise a minimum aggregate additional £30.0 million from other Placees in order to raise a minimum of £100.0 million (gross) through the Placing which would allow the Company to complete the acquisition of the Tranche 2 Properties, with the balance of the consideration being funded from existing cash resources and the AUK Facility.

Any additional equity raised would be used to provide capital for further disciplined asset management opportunities within the Group's existing portfolio as well as new investment opportunities. Additionally the excess equity raised would support refinancing and restructuring of the Group's existing facilities at lower leverage levels.

For example, should the Company raise £150.0 million through the potential Placing, the excess up to £50 million may be utilised to reduce the Company's leverage on the Acquisition. The AUK Facility is a flexible facility (through the £148.0 million revolving credit facility) with the margin charged subject to the amount of debt drawn and the resultant loan-to-value ratio. Utilising the maximum drawdown of £98.0 million would result in a loan-to-value ratio on the Combined AUK Portfolio of 55 per cent and a margin of 1.9 per cent. Limiting the drawdown to £75.0 million would result in a reduced margin of 1.75 per cent. Should the overall facility be reduced to £263.0 million following the sale of 16 Grosvenor Street, London and to maintain headroom of £33.0 million, the marginal return on the additional £23.0 million of equity would be 4.6 per cent.

4. BACKGROUND TO AND RATIONALE FOR THE ACQUISITION

The Company has previously highlighted its intention to improve the overall quality of its portfolio through the acquisition of assets which exhibit strong property fundamentals including, inter alia, being located in areas of robust economic activity and being of a size, configuration and specification that meet occupiers' requirements. The acquisition of the Combined AUK Portfolio, comprising 19 (following the disposal of 16 Grosvenor Street, London as described above) largely institutional quality properties, offered the Company a scalable opportunity to deliver on its strategy.

Progress to date in the delivery of asset management initiatives on the Combined AUK Portfolio has exceeded the Company's initial expectations. The early realisation of opportunities underlines the Board's continued strong belief that the acquisition of the Combined AUK Portfolio provides the Company with an opportunity to acquire a large portfolio of institutional quality assets which provide enhanced income and capital growth opportunities to the Group. The acquisition of the Combined AUK Portfolio also provides a number of strategic benefits in terms of scale, liquidity and access to alternative sources of funding.

The strategic rationale is set out in more detail below:

· The Combined AUK Portfolio provides exposure to a high quality diversified UK portfolio where the Company expects to capture rental growth as the UK economy continues to improve and the supply of available space continues to reduce.

· The acquisition of the Combined AUK Portfolio provides scale and critical mass to the Company's portfolio, increasing the value of the property portfolio to approximately £1.5 billion. The increased number of assets in predominantly well located areas of the UK provides opportunities to work with occupiers across the enlarged portfolio.

· The acquisition of the Combined AUK Portfolio increases the Company's exposure to the UK, meaning that, following the disposal of the Company's interest in the Cromwell Group on 31 August 2015, the Group's pro forma portfolio will be focused on the UK (80 per cent) and Germany (20 per cent), two of the strongest economies in Europe.

· The portfolio is geographically diversified throughout the UK with over 76 per cent by value located in the following key regions: London (29 per cent), the South East (33 per cent) and the 'Big Six' regional cities of Manchester, Leeds, Bristol, Birmingham, Edinburgh and Glasgow (15 per cent) providing exposure to areas with strong and improving economic fundamentals.

· The portfolio is predominantly focused on the retail and office sectors which fit well within the Group's existing asset base and areas of expertise.

· The portfolio provides exposure to £98.1 million of well-located industrial and distribution assets; a sector in which the Company has limited exposure and which is currently experiencing strong demand and rental growth potential.

· The acquisition of the Combined AUK Portfolio enhances the ability of the Company to recycle capital. The increased size of the Company's overall portfolio will allow the sale of mature or underperforming assets without materially impacting on the Group's short term earnings expectations.

· The overall yield on the portfolio may be further enhanced through a number of asset management initiatives including recycling capital from certain lower yielding assets into higher yielding opportunities.

· At the date of this announcement, the portfolio has an overall occupancy of 96.69 per cent (by area) providing asset management opportunities to reduce voids and associated carrying costs which will drive both higher income returns and capital values.

· The Company has previously announced its intention to diversify its sources of debt funding away from bilateral banking facilities to provide improved liquidity, lower its cost of funding and provide improved operational flexibility. The acquisition of the Combined AUK Portfolio and the AUK Facility support the acceleration of this strategy through establishing a more flexible banking facility with a group of relationship banks well known to the Company. The AUK Facility is being used to part fund the Acquisition and includes a revolving credit facility of £148.0 million with the remaining term loan element providing sufficient flexibility for sales, acquisitions and early repayment.

Further details about the Combined AUK Portfolio will be set out in paragraph 14 of Part 15 (Additional information) of the Prospectus.

5. CURRENT TRADING AND PROSPECTS

The Combined AUK Portfolio

The Combined AUK Portfolio comprises 19 properties (following the disposal of 16 Grosvenor Street, London as described above), of which five assets are single-let and the balance multi-let. The portfolio comprises largely institutional quality assets which have strong property fundamentals and scope for adding capital value through active asset management. At the time of this announcement, the Company has identified numerous asset management opportunities to reduce voids and associated carrying costs, notwithstanding already high overall occupancy of 96.69 per cent (by area).

At 31 August 2015, the topped up net initial yield, excluding 16 Grosvenor Street, London and reflecting actual purchaser's costs, was approximately 5.8 per cent. Further, as set out in the 2015 Annual Report (as amended to exclude the sale of 16 Grosvenor Street, London), the Combined AUK Portfolio showed the following characteristics:

The valuation carried out on the portfolio in January 2016 valued the AUK Portfolio (excluding 16 Grosvenor Street, London) at £462.1 million, which is a £3.2 million increase when compared to the £458.9 million valuation (excluding 16 Grosvenor Street, London) at the time of the announcement in September 2015. This is a particularly pleasing result as it is only four months since the last valuation.

As was highlighted in the Circular, the Combined AUK Portfolio presents several opportunities to recycle capital from certain lower yielding assets into higher yielding assets, as reflected in the decision to dispose of 16 Grosvenor Street in London's Mayfair. While it is a prime asset, it is also low-yielding and, as such, was deemed to sit outside the Company's immediate, income-focused strategy.  16 Grosvenor Street was originally to be purchased for £29.0 million but was sold for £35.6 million (as announced by the Company on 21 December 2015). The asset was part of the Tranche 2 Properties and subject to a 50 per cent profit share in the event that it was sold for more than £35.0 million. The sale, including profits realised, has reduced the consideration payable for the Tranche 2 Properties by £32.0 million to £201.7 million (£210.2 million including costs).

To date, asset management efforts have largely been focused on letting of vacant space and lease renewals. Four new lettings and renewals totalling £0.5 million have been agreed and negotiations on three new lettings are nearing completion at or above estimated rental value. Two rent reviews have been agreed at Charing Cross, London totalling £0.8 million (£0.2 million above passing rent). In addition, good progress is being made on vacancies in other vacant regional office assets. Overall progress to date in the delivery of asset management initiatives on the overall portfolio has exceeded the Company's initial expectations.

The Company sees further asset management opportunities around modest rental growth, reconfiguration and optimisation of limited space and further development and expansion activities.

The Group

The investment market, both in the UK and Germany, continues to benefit from strong demand, albeit that levels of investment have normalised following record investment volumes in the second quarter of 2015. International investors continue to dominate the UK investment market, with a similar trend now evident in Germany.

Rental values in the UK have continued on an upward trend, although this has been driven to a large extent by the office and distribution sectors, principally in London and the South East. Growth in retail rents has been more muted although there has been some encouraging data in the second half of 2015. Demand from retailers in Germany continued to strengthen during the year, with interest improving from both local and international brands. Demand continues to outweigh supply in prime locations which is having a positive knock-on effect on secondary locations.

With performance in the next phase of the property cycle likely to be more heavily weighted to income returns and rental growth, the Group's approach toward recycling capital into assets with strong fundamentals and occupier demand is as important as ever.

Reshaping the portfolio

The Group's geographic exposure has been streamlined following the sale of its remaining investment in the Cromwell Group and the Swiss COOP portfolio. The Group's core portfolio is now wholly focused on the UK and Germany, Europe's two strongest economies and its largest real estate investment markets. Capital recycling and new investment have also significantly repositioned the portfolio to locations with stronger economic fundamentals and improved occupier demand.

Notwithstanding the proposed completion of the acquisition of Tranche 2, the Group's recent acquisition and disposal activities have improved the overall quality of the portfolio and enhanced expectations of rental and income growth. The Group's pro-forma portfolio, incorporating 100 per cent ownership of the Combined AUK Portfolio, increases the average lot size and the quality of our assets, providing enhanced liquidity.

UK Retail

Occupancy improved markedly during the year to 97.1 per cent (2014: 95.4 per cent) following 119,000 sq ft of lettings. 25 lease events were completed, generating a gross rent of £1.3 million. Two rent reviews were agreed, providing a total rent of £0.1 million, 7.9 per cent above the previous passing rent. 23 new lettings or renewals were completed, providing a total rent of £1.2 million, 1.7 per cent below the estimated rental value.

Successful letting activity at Grand Arcade, Wigan increased occupancy to 99.8 per cent with the final unit currently under offer to an international retailer. New Look introduced one of their first menswear stores in the UK at a passing rent of £120,000 per annum reflecting a 27 per cent premium to estimated rental value. There were also new lettings to Clarks and Holland & Barrett at a combined passing rent of £150,000.

Pep & Co, a new entrant to the discount clothing market in the UK, signed new leases at Birchwood and Coventry totalling 8,900 sq ft on a turnover basis. Sports Direct signed a new lease over 6,000 sq ft at Birchwood on a turnover rental basis, taking the last remaining retail space at the centre.

The majority of the Group's shopping centres are now near full occupancy and, with steady improvements in the economy and improving retail trends, the outlook for rents and rental growth for quality assets continues to improve.

Footfall for the year was down by 0.8 per cent which compares favourably with national indices which were 1.3 per cent down over the same period. The trend appears to have stabilised with footfall increasing by 1.1 per cent across the portfolio in the three months to 31 August 2015.

UK Hotels

Underlying performance from the Redefine BDL managed portfolio was broadly in line with management's expectations. Revenue increased by 6.0 per cent which translated into a 7.9 per cent increase in EBITDA. The rental level for the 2016 financial year has been set at £14.3 million, a 4.0 per cent increase on last year.

The DoubleTree by Hilton, Edinburgh was acquired in September 2014 for £25.3 million (excluding transaction costs) reflecting a net initial yield of approximately 6.9 per cent. The hotel has delivered strong underlying results since acquisition, driven by higher room rates. Revenue and EBITDA increased by 30.5 per cent and 65.1 per cent respectively.

Works at Enfield to fit out a 6,800 sq ft extension to the Travelodge have been completed. The additional rent of £113,400 p.a. will increase the net initial yield from 4.5 per cent to 5.4 per cent. The lease for the extension is co-terminus with the existing lease to 2047, and will include retail price index escalations.

Planning was approved for a 12-bedroom extension to the Southwark Holiday Inn Express, London. Construction has commenced with completion set for the third quarter in 2016. The total cost of £2.8 million includes a full enhancement and recladding of the existing hotel façade.

UK Commercial

Occupancy improved to 99.3 per cent (2014: 98.3 per cent) following 6,600 sq ft of lettings. 53 lease events were completed during the year generating additional gross rent of £4.7 million. 47 rent reviews were agreed providing a total rent of £4.0 million, 8.9 per cent above the previous passing rent. Six new lettings or renewals were completed providing a total rent of £0.7 million, 4.9 per cent below estimate rental value. The portfolio has 58.5 per cent of leases subject to fixed uplifts or inflation-linked uplifts.

Planning is expected to be granted at the Crescent Centre, Bristol to reconfigure the entrance and introduce new amenity space. Works are planned to commence in early 2016 with completion expected in the third quarter of 2016. The Crescent Centre is well located within the Bristol office market with current rents of £12.0 per sq ft at favourable levels against neighbouring prime rents of £28.5 per sq ft. A material improvement in rental levels is anticipated following the reconfiguration.

Terms have been agreed with Oxford Brookes University to refurbish 28,412 sq ft of vacant office space in Swindon. Rent has been agreed at £286,000 against an estimate rental value of £216,000 in return for a capital contribution of £0.9 million.

Europe

Occupancy declined marginally to 98.2 per cent (2014: 99.4 per cent). 72 lease events were completed during the year generating additional gross rent of £2.5 million. 39 rent reviews were agreed providing a total rent of £1.0 million, 3.2 per cent above the previous passing rent. 33 new lettings or renewals were completed, providing a total rent of £1.5 million, 12.7 per cent above the estimated rental value. The portfolio has 94.9 per cent of leases subject to fixed uplifts or inflation-linked leases.

A number of leases were renewed during the year at the Bahnhof Centre in Altona, Hamburg. Leases totalling 3,500 sq ft have been extended providing a rent of €0.45 million per annum, 28.6 per cent above the estimate rental value.

Ongoing asset management initiatives at the Schloss Strasse Centre, Berlin have successfully introduced additional revenue streams from media points and improved utilisation of commercialisation space.

6. KEY DETAILS OF THE POTENTIAL PLACING

Placing

If the Placing proceeds, the Company would seek to raise a minimum of £100.0 million (approximately £94.5 million net of expenses) and up to approximately £150.0 million (approximately £143.9 million net of expenses) by way of a potential Placing of up to 375,000,000 Placing Shares, representing, in aggregate, up to 20.0 per cent of the Enlarged Share Capital (if the Maximum Placing Shares were issued). Any issue of Placing Shares pursuant to the Placing would be on a non pre-emptive basis, primarily to institutional investors only, so Placing Shares would only be issued to Existing Shareholders if they participated in the Placing.

The potential Placing would comprise two separate but simultaneous and co-ordinated placings. Placees would be able to participate outside of South Africa and subscribe for Placing Shares in Pounds Sterling pursuant to the UK Placing or participate in South Africa and subscribe for Placing Shares in Rand pursuant to the South African Placing. Investors who participated in the UK Placing would be required to take up Placing Shares in Pounds Sterling. Investors who participated in the South African Placing would be required to take up for Placing Shares in Rand. The South African Placing would be subject to a minimum application of R1 million per investor, acting as principal, except for those categories of exempted persons contemplated in section 96(1)(a) of the South African Companies Act. The South African Placing would be undertaken with certain existing shareholders and new institutional investors. Members of the public (other than any member of the South African public who acts as principal and offers to subscribe for a minimum of R1 million worth of Placing Shares and those categories of exempted persons contemplated in section 96(1)(a) of the South African Companies Act ) would not be entitled to participate in the South African Placing. Similarly the UK Placing would be undertaken with certain existing and new institutional investors only.

The Placing would be conducted, subject to the satisfaction of certain conditions, through an accelerated bookbuild process to be carried out by the Joint UK Bookrunners (in respect of the UK Placing) and Java Capital (in respect of the South African Placing). Assuming the Resolutions are passed at the Extraordinary General Meeting and the Board elects (in consultation with the Bookrunners) to proceed with the Placing, it is expected that the book would open on 16 February 2016 and would close at any time thereafter. The timing of the closing of the book, the Placing Price and the number of Placing Shares would be agreed between the Bookrunners and the Company following completion of the Bookbuild and announced as soon as practicable on a Regulatory Information Service in the UK and the Stock Exchange News Service of the JSE. It is expected that a Pricing Statement containing the Placing Price and the number of Placing Shares issued, would (subject to certain restrictions) be published at the same time and be available on the Company's website at www.redefineinternational.com.

In connection with the potential Placing, if it were to proceed, Redefine Properties has irrevocably agreed to subscribe for such number of Placing Shares at the Placing Price as equals an aggregate subscription amount of up to £70.0 million pursuant to the RPL Equity Commitment (as will be described in paragraph 21.4 of Part 15 (Additional Information) of the Prospectus). The RPL Equity Commitment is subject to the Placing Price not being higher than the Maximum RPL Price.

If the Placing were to proceed, the Company would seek to raise a minimum additional aggregate £30.0 million from other Placees in order to raise an aggregate minimum amount of £100.0 million (gross) through the Placing. If there was the successful procurement of Placees (other than Redefine Properties), the Board expects to scale back Redefine Properties' maximum participation of up to £70.0 million on a pound for pound basis, for every pound raised from other Placees in excess of the additional aggregate £30.0 million, subject to Redefine Properties' entitlement to participate in the Placing at the level which would maintain its current 30.07 per cent shareholding in the Company.

If the Placing proceeds and there is sufficient demand from Placees (including from Redefine Properties, to the extent that it seeks to participate in excess of its pro-rata entitlement in the Placing, subject to its terms and conditions), the Board may then decide to increase the size of the Placing up to a maximum amount of £150.0 million.

The Joint UK Bookrunners are underwriting credit risk on the Placees under the UK Placing (other than Redefine Properties). Java Capital is not underwriting credit risk on the Placees under the South African Placing. Accordingly, to the extent that South African Placees do not take up and pay for their allocation in full, the amount raised by the Company may be less than the amount announced as having been allocated. However, the Placing is conditional on the gross proceeds received by the Company being £100 million or more.

If the Placing proceeds, the Placing Price per UK Placing Share would be determined by the Directors and the Bookrunners, following their assessment of market conditions and discussions with a number of institutional investors during the course of the Bookbuild. In any event, in accordance with Listing Rule 9.5.10R, the Placing Price would not be at a discount of more than 10 per cent to the middle market price of the Ordinary Shares at the time of agreeing the Placing.

The Placing Price per South African Placing Share will be the equivalent price of a UK Placing Share in Rand (subject only to adjustment in terms of the prevailing exchange rate agreed between the Bookrunners and the Company at the time of the Bookbuild).

The RPL Equity Commitment is subject to the Placing Price not being higher than then Maximum RPL Price.

As this announcement and the Prospectus do not constitute or form part of any offer to buy or any invitation to sell or issue, or any solicitation of any offer to buy or subscribe for, Placing Shares in any jurisdiction, no maximum price is included in this announcement or the Prospectus.

If the Placing proceeds and if there is sufficient demand from investors to subscribe for Placing Shares at a higher price than the Maximum RPL Price, such that the Company can raise the minimum proceeds of £100.0 million without recourse to the RPL Equity Commitment, then the Placing Price may be set at a higher price than the Maximum RPL Price and Redefine Properties would not be obliged to subscribe for any Placing Shares under the RPL Equity Commitment unless it agrees to subscribe for Placing Shares at the higher price.

If the Company and the Joint Bookrunners agree that the UK Placing will proceed, the UK Placing Agreement is conditional upon, inter alia, the following:

· the Resolutions being passed by the relevant Shareholders at the Extraordinary General Meeting (without material amendment);

· the Company raising proceeds of at least £100.0 million through the Placing;

· the Placing Agreement becoming unconditional; and

· Admission becoming effective by not later than 8.00 a.m. (London time) on 23 February 2016 or such later time and/or date as the Company and the Joint UK Bookrunners may agree (being not later than 8.00 a.m. (London time) on 31 May 2016).

Accordingly, if any of such conditions were not satisfied, or, if applicable, waived, the potential UK Placing would not proceed, and the Company will utilise the RPL Loan in order to complete the acquisition of the Tranche 2 Properties, to the extent that the South African Placing has not otherwise taken place and raised sufficient funds.

If the Company and Java Capital agree that the South African Placing will proceed, the South African Placing would be conditional upon, inter alia, the following:

· the Resolutions being passed by the relevant Shareholders at the Extraordinary General Meeting (without material amendment);

· the Company raising proceeds of at least £100.0 million through the Placing;

· the South African Placing Agreement becoming unconditional; and

· Admission becoming effective by not later than 9.00 a.m. (South African time) on 23 February 2016 or such later time and/or date as the Company and the Bookrunners may agree (being not later than 9.00 a.m. (South African time) on 31 May 2016).

Accordingly, if any of such conditions were not satisfied, or, if applicable, waived, the potential South African Placing would not proceed, and the Company will utilise the RPL Loan in order to complete the acquisition of the Tranche 2 Properties, to the extent the UK Placing has not taken place and raised sufficient funds.

Admission

It is proposed that, subject to Shareholder approval of the Resolutions and the Directors (in consultation with the Bookrunners) electing to proceed with the Placing, application will be made for the Placing Shares to be (a) admitted to listing on the premium segment of the Official List and to trading on the London Stock Exchange's main market for listed securities and (b) listed and traded on the Main Board of the JSE. It is expected that Admission of the Placing Shares would become effective and dealings would commence by 8.00 a.m. (London time) on 23 February 2016 in respect of the UK Placing Shares and 9.00 a.m. (South African time) on 23 February 2016 in respect of the South African Placing Shares whereupon an announcement will be made by the Company to a Regulatory Information Service and on SENS.

As the Placing would not involve a pre-emptive offer of shares to Existing Shareholders, Existing Shareholders who do not or are not permitted to participate in the potential Placing would suffer a maximum dilution of up to 20.0 per cent to their interests in the Company (assuming a fundraising of £150.0 million where 375,000,000 Placing Shares are issued pursuant to the potential Placing at the Minimum Placing Price).

Consequences of the Placing not proceeding

If the Resolutions are not approved by Shareholders at the EGM or prevailing market conditions mean that the Board (in consultation with the Bookrunners) elects not to proceed with the Placing or if, inter alia, the Company is unable to raise the minimum gross proceeds of £100.0 million through the Placing, the Placing will not proceed and the Company will utilise the RPL Loan to fund the completion of the acquisition of the Tranche 2 Properties.

In such circumstances the Company would then have three months from the date of drawdown in which to either:

· repay the proceeds from any subsequent debt or equity fundraising, again should market conditions permit the Company to raise such funds after completion of Tranche 2; or

· failing that, elect to convert the loan (or otherwise allow the loan to convert automatically at the end of the three-month period) in either case leading to Redefine Properties taking a 50 per cent equity interest in the Acquisition SPVs and Redefine Banbury Cross Limited, through an allotment of new shares by Redefine AUK representing 50 per cent of the then enlarged issued share capital of Redefine AUK.

If the Company has to utilise the RPL Loan to fund the completion of Tranche 2 (and the Company elects not to raise funds through a debt or equity fundraising prior to the repayment date of the RPL Loan), the Company may elect for the Conversion (or Conversion would occur automatically on the repayment date of the RPL Loan if it was not otherwise repaid before then), which would result in the Disposal. The RPL JV would be formed at that stage, as the Company and Redefine Properties would then each own 50 per cent of Redefine AUK, subject to the provisions of the RPL JV Agreement which would then apply. Redefine AUK would, at that stage, own Banbury Cross Retail Park and 100 per cent of the Tranche 1 Properties and Tranche 2 Properties by virtue of completion of the Acquisition Agreements. The RPL JV in respect of Redefine AUK would be a 50:50 joint venture, with neither the Company nor Redefine Properties capable of forcing the other to sell its shareholding in Redefine AUK. Further details of the RPL JV Agreement will be set out in paragraph 21.6 of Part 15 (Additional information) of the Prospectus.

7. WAIVER OF OBLIGATION UNDER RULE 9 OF THE UK TAKEOVER CODE

The potential issue of the Placing Shares to Redefine Properties gives rise to certain considerations under the UK Takeover Code.

The purpose of the UK Takeover Code is to supervise and regulate takeovers and other matters to which it applies. The UK Takeover Code is issued and administered by the Takeover Panel. On the basis that the Company's registered offices are in the Isle of Man and its shares are admitted to trading on a regulated market in the UK, it is a company to which the UK Takeover Code applies and as such its Shareholders are therefore entitled to the protections afforded by the UK Takeover Code.

Under Rule 9 of the UK Takeover Code, any person who acquires an interest (as defined in the UK Takeover Code) in shares which, taken together with shares in which he is already interested and in which persons acting in concert with him are interested, carry 30 per cent or more of the voting rights of a company which is subject to the UK Takeover Code, is normally required to make a general offer to all the remaining shareholders to acquire their shares.

Similarly, where any person who, together with persons acting in concert with him, is interested in shares which in aggregate carry not less than 30 per cent of the voting rights of a company but does not hold more than 50 per cent of such voting rights, a general offer will normally be required if any further interests in shares are acquired by any such person.

An offer under Rule 9 must be made in cash and at the highest price paid by the person required to make the offer, or any person acting in concert with him, for any interest in shares of the company during the 12 months prior to the announcement of the offer.

Currently, the Company has one large shareholder, Redefine Properties, which has an interest of 30.07 per cent in the Company at the date of this announcement. For the purposes of the UK Takeover Code, Michael Watters, Marc Wainer and Bernard Nackan are also members of the Concert Party, as they are directors of Redefine Properties, and are also interested in Ordinary Shares. Furthermore, Stephen Carlin is also a member of the Concert Party as a result of his directorship of and interest in Redefine BDL. This results in the Concert Party having an aggregate holding of 30.80 per cent of the Company's Existing Ordinary Shares as at the Latest Practicable Date.

If the Company raises the minimum gross proceeds of £100.0 million through the Placing, such that Redefine Properties subscribes for the RPL Equity Commitment in full and additional Placees subscribe for Placing Shares for an aggregate value of £30.0 million (including the proposed participation of Michael Watters and Marc Wainer (and his wife) in the Placing, as described in notes (3) and (5) in the table below), the Concert Party would have an interest in up to 636,177,210 Ordinary Shares representing up to 36.45 per cent of the issued share capital of the Company following Admission (assuming the Placing Price is set at the Minimum Placing Price).

A table showing the beneficial interests in Ordinary Shares of the Concert Party and the relevant related parties both before and upon Admission is set out below:

Notes:

(1) Figures are calculated assuming that (a) the Placing Price is set at the Minimum Placing Price, (b) Redefine Properties subscribes for the RPL Equity Commitment in full, (c) the other Placees subscribe for Placing Shares for an aggregate value of £30.0 million and (d) no further issues of Ordinary Shares occur between publication of this announcement and Admission.

(2) Michael Watters' shareholding is held indirectly through two pension fund structures.

(3) Michael Watters has irrevocably undertaken to subscribe for such number of Placing Shares at the Placing Price as equals an aggregate amount of £150,000, if the Placing proceeds.

(4) Marc Wainer's beneficial interest is held through the 103,774 shareholding in the name of his wife and the 2,755,541 shareholding held by Ellwain Investments (Pty) Limited, of which he is a 50 per cent shareholder.

(5) Marc Wainer has irrevocably undertaken to subscribe for 175,000 Placing Shares at the Placing Price (to be held through his Drawood Trust) and procure that his wife subscribes for 20,000 Placing Shares at the Placing Price, if the Placing proceeds.

(6) Bernard Nackan's percentage interest in the Ordinary Share capital rounds down to 0.00 per cent.

Following an application by the Directors, the Takeover Panel has agreed, subject to the Rule 9 Waiver Resolution being passed on a poll by Rule 9 Independent Shareholders, to waive the requirement for the Concert Party to make an offer to Shareholders as would otherwise arise under Rule 9 of the UK Takeover Code as a result of the issue of up to a maximum aggregate amount of 175,000,000 Placing Shares to Redefine Properties and 375,000 Placing Shares to Michael Watters (assuming the Placing Shares are issued at the Minimum Placing Price) and 175,000 Placing Shares to Marc Wainer (to be held through his Drawood Trust) and 20,000 Placing Shares to Marc Wainer's wife. The potential Placing would therefore be conditional on the approval of the Rule 9 Waiver Resolution by Rule 9 Independent Shareholders being obtained.

In addition, Michael Watters may be entitled to receive further Ordinary Shares in the future (as approved at the extraordinary general meeting of the Company held on 29 November 2013) by virtue of any awards granted under and pursuant to the terms of the Performance Share Plan. The maximum number of new Ordinary Shares which may be issued to Michael Watters, (if the maximum possible awards were granted by the Remuneration Committee under the Performance Share Plan and all conditions to the awards were satisfied in full) is 7,000,000 Ordinary Shares.

Therefore assuming the award and subsequent issue of the maximum amount of 7,000,000 Ordinary Shares to Michael Watters and the issue of the Placing Shares (assuming the minimum proceeds of £100 million are raised through the Placing, that Redefine Properties subscribes for the RPL Equity Commitment in full and that the Placing Price is set at the Minimum Placing Price), the maximum interest of Michael Watters would be 13,537,697 Ordinary Shares (representing 0.77 per cent of the issued share capital of the Company) and the maximum interest of the Concert Party would be643,177,210 Ordinary Shares (representing 36.70 per cent of the issued share capital of the Company).

Further details about Redefine Properties and the other members of the Concert Party will be set out in Part 14 (Waiver of Rule 9 of the UK Takeover Code and Information on the Concert Party) of the Prospectus.

The UK Takeover Code requires the Independent Directors to obtain competent independent advice regarding the merits of the transaction which is the subject of the Rule 9 Waiver Resolution, the controlling position which it will create, and the effect which it will have on the Shareholders generally.

Accordingly, Peel Hunt, as the Company's UK sponsor, has provided formal advice to the Independent Directors regarding the Placing. Peel Hunt confirms that it is independent of the Concert Party and has no commercial relationship with any member of the Concert Party.

Shareholders should note that, following the Placing, the Concert Party would not be entitled to increase its interest in the voting rights of the Company without incurring a further obligation under Rule 9 of the UK Takeover Code to make a general offer (unless a dispensation from this requirement has been obtained from the Takeover Panel in advance).

If the Rule 9 Waiver Resolution is passed by the Rule 9 Independent Shareholders at the Extraordinary General Meeting, the Concert Party will not be restricted from making an offer for the Company.

8. RELATED PARTY TRANSACTION

By virtue of Redefine Properties' 30.07 per cent shareholding in the Company, Redefine Properties is a related party due to it being a substantial shareholder of the Company under the UK Listing Rules. Redefine Properties' proposed subscription of such number of Placing Shares under the Placing as equals an aggregate amount of £70.0 million constitutes a related party transaction under Chapter 11 of the UK Listing Rules.

Consequently, the Related Party Transaction is conditional upon, and must be approved by, the Related Party Independent Shareholders before it can be completed. Accordingly, the approval of the Related Party Independent Shareholders will be sought at the EGM to be held on 15 February 2016. The notice convening the EGM will be set out at the end of the Prospectus, which also comprises a circular to Shareholders. Further details of the Resolutions are set out at paragraph 9 below. Redefine Properties will not vote on the Related Party Resolution and has undertaken to take all reasonable steps to ensure that its associates will not vote on the Related Party Resolution to be proposed at the EGM.

9. SUMMARY OF EXTRAORDINARY GENERAL MEETING

The Placing is subject to a number of conditions, including Shareholders' approval of the Resolutions to be proposed at the Extraordinary General Meeting (without material amendment). If any of those Resolutions are not approved at the Extraordinary General Meeting, the Company would be unable to complete the Placing.

A notice convening the Extraordinary General Meeting to be held at 2nd Floor, 30 Charles II Street, London SW1Y 4AE at 9.30 a.m. on 15 February 2016 will be set out at the end of the Prospectus.

First Resolution

The First Resolution, which is subject to and conditional on the passing of the Second Resolution, the Rule 9 Waiver Resolution and the Related Party Resolution, authorises the Directors to allot up to 375,000,000 Ordinary Shares, representing approximately 25.1 per cent of the Company's current issued share capital as at the Latest Practicable Date). This will enable the Company to allot sufficient Placing Shares to satisfy its obligations in connection with the potential Placing. This authority will expire at the conclusion of the next annual general meeting of the Company in 2017 (unless previously revoked or varied by the Company). The authority granted under the First Resolution, which will be proposed as an ordinary resolution requiring a simple majority of votes in favour, is in addition to the authority to allot Ordinary Shares which was granted to the Directors at the Company's annual general meeting on 26 January 2016, and which will expire on the date of the annual general meeting of the Company to be held in 2017 unless previously revoked or varied by the Company.

Second Resolution

The Second Resolution, which is subject to and conditional on the passing of the First Resolution, the Rule 9 Waiver Resolution and the Related Party Resolution, grants the Directors authority to allot equity securities for cash pursuant to the authority conferred on them by the First Resolution as if the pre-emption provisions in Article 10 of the Articles of Association did not apply to such allotment.

It should be noted that whilst the provisions of Article 10 of the Articles of Association confer on Shareholders rights of pre-emption on the allotment of equity securities for cash, the Second Resolution seeks to disapply this right for the purpose of the potential Placing.

The Second Resolution will be proposed, as a special resolution requiring the approval of at least 75 per cent of the votes cast. The authority granted under the Second Resolution is in addition to the authority which was granted to the Directors at the Company's annual general meeting on 26 January 2016, and will (unless previously revoked or varied by the Company in general meeting) expire on the date 15 months from the passing of such resolution.

Third Resolution: Rule 9 Waiver Resolution

The Rule 9 Waiver Resolution, which will be proposed as an ordinary resolution, and which is conditional on the First Resolution, the Second Resolution and the Related Party Resolution, proposes that the grant by the Takeover Panel of the waiver of the Concert Party's obligations under Rule 9.1 of the UK Takeover Code (which is explained in paragraph 7 above) be approved. This resolution must be approved by Rule 9 Independent Shareholders by a simple majority. Under the UK Takeover Code, this resolution must be conducted by way of a poll.

Fourth Resolution: Related Party Resolution

The Related Party Resolution, which will be proposed as an ordinary resolution and which is conditional on the First Resolution, the Second Resolution and the Rule 9 Waiver Resolution being passed, proposes that the Related Party Transaction, which constitutes a related party transaction under the UK Listing Rules, be approved and that the Directors be authorised to implement the Related Party Transaction as they deem fit. This resolution must be approved by the Related Party Independent Shareholders by a simple majority.

Shareholders' attention is again drawn to the fact that the potential Placing is conditional and dependent upon each of the Resolutions being passed.

For further information in relation to the Resolutions to be proposed at the Extraordinary General Meeting, please see the Notice of Extraordinary General Meeting which will be set out at the end of the Prospectus.

10. IRREVOCABLE UNDERTAKINGS

Redefine Properties has irrevocably undertaken to vote in favour of the Share Authority Resolutions at the EGM, representing approximately 30.07 per cent of all votes capable of being cast in respect of those Resolutions.

Those Directors who own Ordinary Shares have irrevocably undertaken to vote in favour of the Share Authority Resolutions and the Related Party Resolution at the EGM, representing approximately 0.58 per cent of all votes capable of being cast in respect of those Resolutions.

Save for Michael Watters, Marc Wainer, Bernard Nackan, Gavin Tipper, Robert Orr and Adrian Horsburgh, those Directors who own Ordinary Shares have irrevocably undertaken to vote in favour of the Rule 9 Waiver Resolution, representing 0.04 per cent of all votes capable of being cast in respect of such Resolution.

If the Placing proceeds:

· Michael Watters and Robert Orr have irrevocably undertaken to subscribe for such number of Placing Shares at the Placing Price as equals an aggregate amount of £150,000 and £10,000 respectively;

· Gavin Tipper and Adrian Horsburgh have irrevocably undertaken to subscribe for 100,000 Placing Shares and 10,000 Placing Shares at the Placing Price respectively; and.

· Marc Wainer has irrevocably undertaken to subscribe for 175,000 Placing Shares at the Placing Price (to be held through his Drawood Trust) and procure that his wife subscribes for 20,000 Placing Shares at the Placing Price.

11. FINANCIAL IMPACT OF THE PLACING

A pro forma statement of the net assets of the Group and illustrations of the effect of the potential Placing and the completion of the acquisition of the Tranche 2 Properties on the Group as at 31 August 2015 will be set out in Part 12 (Unaudited Pro Forma Financial Information of the Group) of the Prospectus.

12. RECOMMENDATION

Placing and Share Authority Resolutions

Subject to favourable prevailing market conditions, the Board believes that the potential Placing and the Share Authority Resolutions are in the best interests of the Company and its Shareholders as a whole. Accordingly, the Board unanimously recommends that you vote in favour of the Share Authority Resolutions, as those Directors who are Shareholders intend to do in respect of their own beneficial holdings comprising 8,645,431 Ordinary Shares, representing, in aggregate, 0.58 per cent of the Company's issued share capital as at the Latest Practicable Date. As noted in paragraph 10 above, Redefine Properties has also irrevocably undertaken to vote in favour of the Share Authority Resolutions at the EGM, representing approximately 30.07 per cent of all votes capable of being cast in respect of those Resolutions.

Rule 9 Waiver

The Independent Directors, who have been so advised by Peel Hunt, consider the terms of the Placing to be fair and reasonable and in the best interests of the Rule 9 Independent Shareholders and the Company as a whole. In providing such advice to the Independent Directors, Peel Hunt has taken account of the Board's commercial assessment of the Placing. None of Michael Watters, Marc Wainer and Bernard Nackan have taken part in the Independent Directors' consideration of the Rule 9 Waiver Resolution, as they are members of the Concert Party. None of Gavin Tipper, Robert Orr and Adrian Horsburgh have taken part in the Independent Directors' consideration of the Rule 9 Waiver Resolution, as they have irrevocably undertaken to participate in the Placing.

Accordingly, the Independent Directors unanimously recommend that all Rule 9 Independent Shareholders vote in favour of the Rule 9 Waiver Resolution to be proposed at the Extraordinary General Meeting, as the Independent Directors who own Ordinary Shares intend to do in respect of their own beneficial holdings, comprising 573,536 Ordinary Shares in aggregate, representing approximately 0.04 per cent of the existing issued share capital of the Company as at the Latest Practicable Date.

Related Party Transaction

The Board, having been so advised by Peel Hunt, consider the terms of the Related Party Transaction to be fair and reasonable as far as Shareholders are concerned and in the best interests of the Company and Shareholders as a whole. In providing financial advice to the Board, Peel Hunt has taken account of the Board's commercial assessment of the Related Party Transaction. None of Michael Watters, Marc Wainer and Bernard Nackan have taken part in the Board's consideration of the Related Party Resolution. Redefine Properties (being the related party for the purpose of the UK Listing Rules) has irrevocably undertaken (a) that it will not vote on the Related Party Resolution and (b) to take all reasonable steps to ensure that each of its associates who are beneficially interested in Ordinary Shares will not vote on the Related Party Resolution, in each case to be proposed at the EGM.

Accordingly, the Board consider that the passing of the Related Party Resolution would be in the best interests of Shareholders as a whole and unanimously recommend that all Shareholders vote in favour of the Related Party Resolution to be proposed at the Extraordinary General Meeting, as those Directors who own Ordinary Shares intend to do in respect of their own beneficial holdings comprising 8,645,431 Ordinary Shares in aggregate, representing approximately 0.58 per cent of the existing issued share capital of the Company as at the Latest Practicable Date.

Illustrative timetable for the potential Placing:

Notes:

(1) Each of the times and dates set out in the above timetable and mentioned in this announcement, the Prospectus and in any other document issued in connection with the potential Placing is subject to change by the Company (with the agreement of the Bookrunners, in certain instances), in which event details of the new times and dates will be notified to the UK Listing Authority and, where appropriate, to Shareholders through an announcement on a Regulatory Information Service and on SENS.

(2) Any reference to a time in this announcement is to UK time, unless otherwise specified.

(3) 12.00 p.m. refers to midday.

(4) If the Placing proceeds, the actual Placing Price and the number of Placing Shares issued would be set out in the Pricing Statement. The Pricing Statement would be available free of charge at the Company's registered office for 14 days after Admission. In addition, the Pricing Statement would (subject to certain restrictions) be published on the Company's website at www.redefineinternational.com.

(5) If the Placing proceeds, the Bookbuild lwould close once the Company has decided sufficient applications for Placing Shares have been received.

DEFINITIONS