AMA
AMA
AMA - AMAP - Termination of Steinfurn Acquisition Discussions
Amalgamated Appliance Holdings Limited
Incorporated in the Republic of South Africa
Registration number 1997/004130/06
Share code: AMA & ISIN: ZAE000012647
("AMAP")
TERMINATION OF STEINFURN ACQUISITION DISCUSSIONS
1. BACKGROUND
AMAP shareholders are referred to announcements released on 14
December 2006 and 5 March 2007 wherein it was announced that an
agreement in principle had been reached for the acquisition of
Steinhoff Africa Holdings (Pty) Limited`s South African furniture
manufacturing interests ("Steinfurn") ("the acquisition").
1.2 In terms of the acquisition, AMAP, subject to certain conditions
precedent, would have acquired Steinfurn for a consideration of
R1 152 million in exchange for cash of R665 million and,
effectively, the issue of 99 102 037 new AMAP shares at a price
of 491 cents per share ("the acquisition consideration").
1.3 The values for AMAP and Steinfurn were calculated on a relative
basis applying similar ratings and valuation metrics to both AMAP
and Steinfurn. These valuations (based on a historic price:
earnings multiple of approximately 8 times) were supported by a
preliminary fair and reasonable opinion from an independent
professional expert to the independent directors of AMAP, being
all the directors excluding the Steinhoff International Holdings
Limited ("Steinhoff") representatives.
2. TERMINATION OF ACQUISITION DISCUSSIONS
2.1 The AMAP Board was advised on 11 April 2007 by two of its major
shareholders that, whilst they support the rationale for the
acquisition, they are not in favour of the relative valuation
metrics and that they would only support the acquisition if
Steinfurn was acquired at a substantial discount to AMAP`s
rating. This has been communicated by AMAP to Steinhoff.
Steinhoff has advised that it would not be in its shareholders`
interest to reduce the acquisition consideration as requested by
the abovementioned AMAP shareholders.
2.2 In light of the above, both parties considered it prudent to
terminate the related negotiations with respect to the
acquisition.
Johannesburg
12 April 2007
Sponsor: Bridge Capital Advisors (Pty) Limited
Date: 12/04/2007 12:39:48 Produced by the JSE SENS Department.
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