JSE-listed Aveng, through its subsidiary Aveng Africa, on November 28 entered into a sale of shares agreement with Collins Property Group for the 30% interest Aveng holds in the issued share capital of Dimopoint –  a property holding and investment company.

The purchase price of R96-million (A$8.1-million) will be settled in cash on the closing date of the transaction. With all conditions precedent having been met, the transaction is expected to close on December 2.

Aveng in 2015 sold its property portfolio to Dimopoint in exchange for a 30% interest in the company. JSE-listed property development and investment group Collins held the remaining 70% stake.

Aveng group companies were the principal tenants.

The investment in the property portfolio is being disposed of in line with Aveng’s strategy to dispose of noncore assets.

The proceeds from the sale will be used to strengthen the financial position of Aveng and will contribute to the execution of the previously announced strategy, by adding to the liquidity and earnings for shareholders, while allowing management to focus on delivering its strategy of improving shareholder value through increased focus on its operating brands of McConnell Dowell, Built Environs and Moolmans.

The transaction will result in the termination of the head lease agreement between Aveng Africa and Dimopoint, the settlement of rights and the release of all obligations and liabilities associated with the head lease agreement.

It will result in the derecognition of the remaining lease liabilities and associated sub-lease receivables previously recognised by Aveng Africa.

Also, the ongoing expenses and associated liabilities, including contingent liabilities, associated with the properties will be extinguished.

Moolmans has entered into a lease with Dimopoint for the property that it occupies on substantially the same terms and conditions.

The termination of noncore leases is expected to result in a modest future cost saving, Aveng says.