MAS updates shareholders on take-over bids, operational performance in Central and Eastern Europe

MAS, the JSE-listed company that invests mainly in Central and Eastern Europe retail properties, still has received no formal offers from the two competing bid proposals it had received: from Hyprop and from its development partner and shareholder, Prime Kapital Investments.

This was according to MAS's pre-close trading update released Monday, for the financial year to June 30, 2025, in which the owner of retail properties in Romania, Bulgaria, and Poland said all its properties had benefited from “robust trading” in the five months to May 31.

MAS, which also has exposure to commercial and residential developments via a Development Joint Venture (DJV) with Prime Kapital Holdings as the developer and general contractor, said consumption had remained strong in all Central and Eastern European countries where the group operates during the five months.

Overall, like-for-like footfall in directly-owned properties was slightly above the same period in 2024, and tenants' sales per square metre exceeded prior year levels by 7%, both in enclosed malls and in open-air malls.

Updating shareholders on the bids, MAS said the planned transaction for the DJV to repurchase the 60% shares held by Prime Kapital in the DJV, and the termination of the joint venture, had failed in April after Prime Kapital withdrew from the transaction.

A month later, the MAS board received a letter from PK Investments (PKI), a subsidiary of the DJV, which owns more than 20% of MAS’ shares, stating that PKI intended to make a voluntary offer for all of MAS, and two subsequent letters from PKI (on May 27 and on June 5) referred to certain improvements on the original offer.

In the meantime, Hyprop Investments, on May 26, referred to a potential competing voluntary offer for MAS, which was followed by a capital raise on the JSE by Hyprop on June 2.

PKI, DJV, and Prime Kapital then sent a letter to MAS, requesting the board to convene an extraordinary general meeting (EGM) of MAS shareholders by July 11, to vote on two resolutions proposed by PKI.

“If the EGM resolutions are approved by the majority of shareholders, the board … will still need to assess whether, and to what extent, to give effect to the EGM resolutions, including whether any actions authorised by the EGM resolutions are in the best interests of MAS and its shareholders.”

Also, a difference of opinion between MAS and Prime Kapital had arisen about the priority of payments out of the DJV, and the matter might need to be referred to arbitration. 

MAS’ board said the appointment of a South African investment bank was being finalised to act as its independent corporate advisor, while Valeo Capital was appointed to act as its independent transaction sponsor.

“Until the review process has concluded, the board cannot express a view or recommendation on either the potential voluntary bids,” it said.

Operationally, at MAS, collection rates for the five-months were at 99.2%. Occupancy of the retail assets decreased marginally to 97.8% on May 31, from 98% on December 31, 2024, mostly due to the group's completed strip malls assets disposal during the period.

Construction at Mall Moldova, Iasi, owned by the DJV, was finalised as scheduled, and the centre opened on April 17, 2025. It is Romania's second super-regional enclosed mall and retail node, and the only one of this magnitude outside of Bucharest. Occupancy at opening was over 94%.

On May 31, 2025, the group held €174 million in cash and near-cash instruments and was finalising a €45 million bank loan. Processes are ongoing to source further capital required to fund the group's commitments. Some of these processes include additional potential asset disposals, which include the Flensburg Galerie asset.

MAS’ share price fell 0.25% to R24.37 on the JSE on Monday, but the price is more than 50% higher than the R16.20 that it traded at a year ago.

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