| Mon 7 May 2007, 15:24 | | MYD - Myriad Medical Holdings Limited - Acquisitio |
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MYD
MYD
MYD - Myriad Medical Holdings Limited - Acquisition of Filterworks;
Withdrawal of cautionary announcement
Myriad Medical Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number 2006/006371/06)
Share code: MYD ISIN: ZAE000085825
(Myriad)
ACQUISITION OF FILTERWORKS (PTY) LTD
WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT
Introduction
Myriad is pleased to announce that it has reached an agreement to acquire 100%
of the issued share capital, and shareholders loan accounts, of Filterworks
(Pty) Ltd (Filterworks). Filterworks was incorporated for the purpose of
acquiring the medical filter business of Pall Europe Limited in South Africa and
Sub-Saharan Africa from Pall South Africa (Pty) Ltd.
Pall Europe Limited, a subsidiary of Pall Corporation a company listed on the
New York Stock Exchange, is a supplier of a full range of filtration products
including medical filters. Pall Corporation has been operating in South Africa
for some 20 years directly through Pall South Africa (Pty) Ltd.
The effective date of the acquisition is 2 April 2007.
Purchase consideration
The purchase consideration of R13 million will be settled as follows:
R2 million in cash and R1 million by way of an issue of Myriad shares at an
issue price of 98 cents per share, payable on the completion of the resolutive
conditions set out in 5. Should Filiterworks not generate Profit After Tax
(PAT) of R500,000 from 2 April 2007 to 31 May 2007, then there will be a pro-
rata claw-back of the R3 million payment. The payment in b) will be adjusted to
take into account any claw-back;
Filterworks will warrant a PAT of R4 million for the 12 month period from 1
April 2007 to 31 March 2008 (the Warranted Profit). On achievement of the
Warranted Profit, a payment of R10 million to be settled by R7 million in cash
and R3 million by way of an issue of Myriad shares, at an issue price of 98
cents per share. Should the Warranted Profit not be achieved there will be a
proportional reduction of the R10 million above.
In addition to the above payments, 30% of profit before tax for the period 1
April 2008 to 31 March 2010 will be paid to the vendor of Filterworks.
Rationale for the acquisition
In addition to being a stand alone business, the acquisition of Filterworks will
complement Myriad`s product range in the following areas:
Provide a holistic solution supplying a package including ventilators or
anesthetic machines, Pall filters, clinical support and training;
Pall filters can be incorporated as part of an intravenous solution with
Myriad`s ICU, Manta and Arcomed product ranges;
Syringe filters can be complimentary and bundled with Manta`s BD product range.
Financial effects
The unaudited pro forma financial effects of the acquisition, based on the
published reviewed results of Myriad, before and after taking into account the
effects of the Earth Medical acquisition, for the period ended 30 November 2006
are set out below. The unaudited pro forma financial effects have been prepared
for illustrative purposes only to provide information on how the acquisition may
have impacted on the results and financial position of Myriad. Preparation of
the unaudited pro forma financial effects is the responsibility of the
directors. Because of their nature, the pro forma financial effects may not
fairly present Myriad`s financial position after the acquisition or the effect
on future earnings:
Pro-forma Excl. Earth % Change Incl. Earth
as at 30 but incl. and
June 2007 Filterworks Filterworks
Earnings (cps) 4.9 6.3 29 7.1
Headline earnings 4.9 6.3 29 7.1
(cps)
Net tangible asset 22.1 26.8 21 28.7
value (cps)
Net asset value (cps) 52.9 58.6 11 66.9
Weighted average no 166,388,406 168,629,222 172,220,549
of shares in issue
(000)
No of shares in issue 194,478,992
(000) 183,764,706 187,846,339
Notes and assumptions:
Earnings and headline earnings figures in the "After" column are based on the
assumption that the acquisition took place on 1 June 2006, taking into account
the following adjustments:
The full purchase consideration of R13 million has been included;
The pro-forma numbers include a 100% of PAT as set out in the unaudited
management accounts of the Pall South Africa (Pty) Ltd, Medical Filters
Division, for the period from 1 August 2006 to 31 December 2006. These figures
have been adjusted to take into account an assumed Pall Corporation head office
expense allocation of 50% of profit before tax and a 6 month period.
The net asset value and net tangible asset value figures in the "After" column
are based on the balance sheet comprising stock, debtors and creditors of Pall
South Africa (Pty) Ltd as at 31 July 2006., adjusted to reflect Medical Filters
Division share of these assets and liabilities, estimated to be 30%.
The percentage change in the second last column is before taking into account
the acquisition of Earth Medical as set out in the announcement dated 28 March
2007.
Resolutive conditions
The failure of Pall Corporation to approve the change of control of Filterworks
(Pty) Ltd to Myriad.
The failure to satisfy a due-diligence by Myriad on Filterworks and its
business.
Categorisation of the acquisition
The acquisition is categorised as a Category 3 transaction in terms of the JSE
Limited Listings Requirements.
Withdrawal of cautionary announcement
In addition to the Filterworks acquisition Myriad has been in negotiations on
another transaction. Myriad has elected not to proceed with such other
transaction. Accordingly, shareholders are advised that the cautionary
announcement dated 28 March 2007 is withdrawn.
Johannesburg
7 May 2007
Designated Advisor
Sasfin Capital
(A division of Sasfin Bank Limited)
Legal Advisers
Fluxmans Attorneys
Auditors
Moores Rowland
Date: 07/05/2007 15:24:09 Produced by the JSE SENS Department.
