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Update on Proposed Transaction with Kiwi Property Group Limited

27 March 2017

NZX Announcement from NPT Limited

UPDATE ON PROPOSED TRANSACTION WITH KIWI PROPERTY GROUP LIMITED

NPT Limited (NPT) wishes to update shareholders that, further to its announcement of 3�March�2017, it expects to conclude arrangements with Kiwi Property Group Limited (Kiwi Property) regarding its proposal to NPT in the next few days, and to call a special meeting of shareholders at that time.� It anticipates that the special meeting of shareholders will be held in April.

As soon as discussions with Kiwi Property have been concluded, a further announcement about the proposed transaction will be made. Pending that announcement, NPT wishes to provide the following information for shareholders:

Kiwi Property Proposal

Under the Kiwi Property Proposal, and subject to certain conditions including the approval of shareholders, it is intended that:

  • A Kiwi Property subsidiary will sell The Majestic Centre and North City Shopping Centre (the Kiwi Properties) to two NPT subsidiaries for a total consideration of $230 million, being a price supported by independent market valuations dated 31�December 2016;
  • Kiwi Property will pay NPT a one-off amount of $6 million to acquire the right to manage NPT and its property portfolio; and
  • Kiwi Property will subscribe for new, fully paid ordinary shares in NPT and become a cornerstone shareholder in NPT, with a shareholding (including any shares held by Kiwi Property prior to the subscription for shares) of approximately 19.9%.

NPT and its subsidiaries propose to fund the acquisition of the Kiwi Properties through additional bank borrowings and by making a pro rata entitlement offer of new shares to eligible existing shareholders, together with the placement of new shares to Kiwi Property as described above. Further details of the proposed transaction and entitlement offer will be provided to shareholders in the notice of special meeting.

Dividend guidance

On 9 March 2017, NPT declared a dividend for the third quarter of the 31 March 2017 financial year of 0.90 cents per share, payable on 30 March 2017.

NPT�s dividend guidance for the year ending 31 March 2017 is 3.60 cents per share[1], and is consistent with its dividend policy of paying out between 90% and 100% of Distributable Profit[2]. However, in the event that the Kiwi Property Proposal proceeds, the fourth quarter dividend per share (payable in respect of the 31 March 2017 financial year), would be adjusted to reflect the increased number of shares on issue as a result of the proposed entitlement offer. Shareholders who take up all their entitlements under that offer and subscribe for new shares will receive the full benefit of that dividend as if there had been no adjustment; that is, a cash amount equal to 0.9 cents per share based on the number of shares on issue today.� NPT intends to pay its dividend for the fourth quarter of the 31 March 2017 financial year in May 2017.

In respect of dividend guidance for the year to 31 March 2018, if the Kiwi Property Proposal proceeds, the Board expects to at least maintain its dividend guidance of 3.60 cents per share on all shares, including those issued under the Kiwi Property Proposal. If the Kiwi Property Proposal does not proceed, the Board will review its dividend guidance for the year to 31 March 2018, but advises shareholders that it expects that transaction costs incurred in respect of the Kiwi Property Proposal will negatively impact dividends for that financial year.

Shareholders will receive a further update on dividend guidance in the notice of special meeting to be sent to shareholders once negotiations with Kiwi Property are concluded.

Notice of special meeting

Shareholders are urged to read carefully all information that will be sent to shareholders as the notice of special meeting will contain important information relating to the Kiwi Property Proposal.

ENDS

Tony Osborne
Chief Executive Officer
NPT Limited
T 09 302 4586
M 021 606 088

Any media inquiries to be directed to: Karyn Arkell 027 475 3511

[1] Based on the number of shares on issue at the date of this announcement.

[2] Distributable Profit is net profit before taxation adjusted for non-cash items and/or non-recurring items less current tax. The NPT Board considers Distributable Profit as an appropriate measure to evaluate the impact of the Kiwi Property Proposal relative to GAAP profit measures as it removes the impacts of investment property revaluation gains and other one-off items. A reconciliation of Distributable Profit for the year to 31 March 2016 against Net Profit before Taxation is contained in Note 8 to NPT�s annual financial statements for the year ended 31 March 2016.