ZA Company CMH to Buy Properties from Directors for R745m

• CMH is acquiring 13 properties from three directors and their family trusts for R745 million.
• The properties were valued at R780 million as at April 2026, with a discounted rate of R35 million.
• CMH will fund the transaction through a bank loan and existing cash reserves.
• Shareholders are being urged to vote in favor of the deal at an upcoming general meeting.

The board of directors has unanimously approved the transaction, citing its alignment with corporate governance processes and the independent board's recommendation.

Combined Motor Holdings (CMH) has been sitting on a cash reserve that exceeds its operational needs for several years. The company has consistently held onto this surplus, exploring various options to utilize it. One such option was the voluntary share buyback in December 2025, which returned R192 million to shareholders. Although under-subscribed, this move demonstrates CMH's commitment to returning value to its investors. Now, the company is poised to acquire 13 properties from three of its directors and their family trusts for a cash consideration of R745 million.

The properties being acquired are currently leased by CMH on an arm's-length basis. This includes two rental enterprises in Mount Edgecombe, north of Durban, which will be purchased for a combined R165 million. The other six properties in KwaZulu-Natal and seven in Gauteng will also change hands as part of the transaction. Interestingly, these properties were independently valued at R780 million as at April 2026, indicating a discounted rate of R35 million. During the preceding 12 months, they generated gross rental income of approximately R87 million.

CMH will fund the transaction through a bank loan of around R350 million, accounting for 47% of the purchase consideration. This facility is expected to be provided at commercial interest rates with an indicative repayment period of four years. The remaining balance will be settled using CMH's existing cash reserves. Notably, the board of directors has unanimously approved the transaction, citing its alignment with corporate governance processes and the independent board's recommendation. As a result, they are urging shareholders to vote in favor of the deal at an upcoming general meeting.

This development may require CMH shareholders to vote in favour of the transaction at an upcoming general meeting, and lawyers advising on the deal should be aware of the corporate governance processes undertaken and the recommendation of the independent board.

Source: Original reporting via Sens announcement