11 April 2019

Industrial conglomerate group Barloworld Limited on Wednesday launched
its public offer for Khula Sizwe
Property Holdings
, a black-owned property company, in a bid
to enable black South Africans to own a stake in a significant property

Through this transaction, which is part of the company’s vision for
social and economic development, Barloworld will sell a portfolio of its
properties to Khula Sizwe and lease back the properties for a ten-year period.

The black public, and approximately 14 000 of Barloworld’s management
and employees, will own shares in Khula Sizwe, with blue-chip Barloworld as the

Khula Sizwe will be providing the opportunity for black South Africans
to own their share of a commercial property portfolio valued at
R2.86-billion. Barloworld said the total value of the transaction was

The other component of the B-BBEE transaction is the Barloworld Empowerment Foundation Trust, which has a direct 3% stake
in Barloworld Limited and is focused on
poverty alleviation and youth development.

Investors have from Wednesday until May 31, 2019 to apply for their
portion of the 16.34 million-shares available for purchase by black South

The public offer is aimed to raise R163.4-million to fund a portion of
the property acquisition for 30% ownership. Barloworld said it was contributing
R174.2-million for 32% Employee Trust while the balance would be funded through
an external loan.

Tantaswa Fubu, Barloworld spokesperson and
executive for human capital, said the offer to give black South Africans the
opportunity to participate in a property-based B-BBEE share scheme that is not
related to a share price was a first of its kind in this country. 

“Through Khula Sizwe, shareholders have the opportunity to invest
in a property company with less volatility than a share-based scheme,”
Fubu said. 

“The company has guaranteed rental income from Barloworld as Khula
Sizwe’s tenant, making their investment more stable with predictable cashflows,
and reducing risk whilst creating value for shareholders.”

Fubu said Barloworld’s B-BBEE transaction provides the company with the unique opportunity of aligning the objective and prospects of its employees and shareholders.

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