Discovery gets Competition Tribunal green light for Sandton head office acquisition

The Competition Tribunal has unconditionally approved a transaction that will see Discovery acquire its head office building in Sandton, dubbed Discovery Place, from JSE-listed Growthpoint Properties and Zenprop.

The deal involves Discovery Propco – a newly established, wholly owned subsidiary of Discovery Ltd – acquiring sections 2 and 3 of the sectional title scheme from Growthpoint Properties and the Truzen 114 Trust (effectively owned by Zenprop).

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At the same time, Growthpoint will acquire Section 1 of the building from the same trust.

Discovery Place comprises three interconnected office towers with conference, wellness and limited retail facilities. Discovery Central Services, part of the group, is already a tenant in the building.

The approval follows an announcement in February that Discovery would purchase its head office for about R4.05 billion, as it reassesses its long-term lease arrangements.

The group had signed a 15-year lease in 2018 after consolidating its operations into the building, but indicated it would likely remain in the space beyond the lease period.

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The shift to ownership is expected to reduce costs over time, with Discovery previously noting that changing from a lease to a commercial mortgage structure would result in lower overall expenditure.

The Competition Tribunal found no competition concerns arising from the transaction and approved it without conditions.

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