| Fri 11 May 2007, 17:10 | | RBW / REM - Remgro / Rainbow - The Proposed Scheme |
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RBW REM
RBW REM
RBW / REM - Remgro / Rainbow - The Proposed Scheme of arrangement and terms of
the alternative offer
Rainbow Chicken Limited
(Incorporated in the Republic of South Africa)
(Registration number 1966/004972/06)
Share code: RBW ISIN: ZAE000019063
("Rainbow")
Remgro Limited
(Incorporated in the Republic of South Africa)
(Registration number 1968/006415/06)
Share code: REM ISIN: ZAE000026480
("Remgro")
Not for release, publication or distribution, in whole or in part, in, into or
from the United States of America, Australia, Canada, or Japan
THE PROPOSED SCHEME OF ARRANGEMENT AND TERMS OF THE ALTERNATIVE OFFER
1. INTRODUCTION
Shareholders are referred to the announcement dated 22 March 2007, which
contained details of Remgro`s intention to propose a scheme of arrangement
("Scheme") in terms of section 311 of the Companies Act, 1973 (Act 61 of 1973),
as amended ("the Companies Act"), between Rainbow and its shareholders other
than Remgro and its subsidiaries pursuant to which Remgro is to acquire all the
shares held by such shareholders for a cash consideration of R16.00 per share or
a share consideration of 9 Remgro shares for every tranche of 100 Rainbow shares
held or a combination of cash and tranches of Rainbow shares as aforesaid.
This announcement contains the expected salient dates and times in relation to
the scheme and the terms of the alternative offer as well as the opinions and
recommendations regarding the Scheme and the alternative offer.
2. SCHEME MEETING
Shareholders are advised that in terms of an Order of Court dated 11 May 2007,
the High Court of South Africa ("the Court") has granted leave to convene a
scheme meeting ("the scheme meeting"), to be held at 10:00 on Tuesday 5 June
2007 at One The Boulevard, Westway Office Park, Westville,
KwaZulu-Natal 3629.
3. SALIENT DATES AND TIMES
The expected dates and times pertaining to the Scheme are set out below:
2007
Notice of scheme meeting and Order of Sunday 13 May / Monday 14 May
Court convening the scheme meeting
published in the South African press on
Last day to trade in Rainbow shares on Friday 18 May
the JSE in order to be recorded in the
register to vote at the scheme meeting,
by close of trade on the JSE on (refer
note 2 below)
Record date for voting Friday 25 May
Last day to lodge forms of proxy for the Friday 1 June
scheme meeting (refer note 5 below) (for
use by certificated and own - name
dematerialised shareholders) by 10:00 on
Scheme meeting to be held at 10:00 on Tuesday 5 June
Results of the Scheme meeting announced Tuesday 5 June
on SENS on
Results of the Scheme meeting published Wednesday 6 June
in the South African press on
Chairperson`s report to the Court Wednesday 6 June
regarding the results of the Scheme
meeting lies open for inspection from
Court hearing to sanction the Scheme Tuesday 12 June
expected at 10:00 (or so soon thereafter
as Counsel may be heard) on
If the Scheme is sanctioned and Wednesday 13 June
implemented
Order of Court sanctioning the Scheme
registered by the Registrar of Companies
Results of the application to Court and Thursday 14 June
registration of the Order of Court
announced
on SENS on
Results of the application to Court and Friday 15 June
registration of the Order of Court
published
in the South African press on
Last day to trade in Rainbow shares on Friday 15 June
the JSE
to be recorded in the register on the
record date of the Scheme on
Suspension of the listing of Rainbow Monday 18 June
shares
on the JSE at the commencement of trade
on the JSE on
Record date of the Scheme on which Friday 22 June
shareholders must be recorded in the
register
to receive the scheme consideration by
close of business on
Operative date of the Scheme from Monday 25 June
commencement of trade on the JSE on
Consideration made available to scheme Monday 25 June
participants from
Termination of the listing of Rainbow Tuesday 26 June
shares on the JSE at the commencement of
trade on the JSE on
Notes:
1. Any variation of the above dates and times, as may be
approved by the Securities Regulation Panel ("SRP"), the JSE and/or the Court,
(to the extent that this approval is required) will be released on SENS and
published in the South African press.
2. Shareholders should note that, as trade in Rainbow shares on
the JSE is settled through Strate, settlement for trade takes place five
business days after such trade. Therefore, shareholders who acquire Rainbow
shares on the JSE after Friday 18 May 2007 will not be eligible to vote at the
scheme meeting.
3. Dematerialised scheme members, other than own-name
dematerialised scheme members, must provide their CSDP or broker with their
instructions for voting at the scheme meeting by the cut- off time and date
advised by the CSDP or broker for instructions of this nature.
4. No dematerialisation or rematerialisation of Rainbow shares
will take place after Friday 15 June 2007.
5. Forms of proxy for the scheme meeting may also be handed to
The chairperson of the scheme meeting by no later than 10 minutes before the
commencement of the scheme meeting.
4. CIRCULAR
A circular, which has been approved by the SRP and the JSE, providing full
information on the Scheme and incorporating a notice in respect of the scheme
meeting and the alternative offer will be posted to Rainbow shareholders on 15
May 2007. Copies of the circular may be obtained during normal business hours
from One The Boulevard, Westway Office Park, Westville, KwaZulu-Natal, 3629.
5. OPINIONS AND RECOMMENDATIONS REGARDING THE SCHEME
Investec Bank Limited ("Investec"), acting as independent adviser to the
independent sub-committee and the Rainbow board, has considered the terms and
conditions of the Scheme and is of the opinion that, at the date of issue of its
fair and reasonable opinion, the Scheme is fair and reasonable, and has advised
the independent sub-committee and the Rainbow board accordingly.
The independent sub -committee of the Rainbow board has considered the terms and
conditions of the Scheme and, taking into account the opinion of Investec, is of
the unanimous opinion that the terms and conditions thereof are fair and
reasonable to scheme members. The independent sub - committee has recommended to
the Rainbow board that it recommends to scheme members that they vote in favour
of the Scheme at the Scheme meeting.
The Rainbow board (other than Messrs Visser and Zwiegelaar who are
representatives of Remgro on the Rainbow board and who have accordingly recused
themselves from expressing such an opinion) has considered the terms and
conditions of the Scheme as well as the cash consideration and share
consideration and, taking into account the opinion of Investec and the
independent sub -committee, is of the unanimous opinion that the terms and
conditions thereof are fair and reasonable to scheme members and recommends that
scheme members vote in favour of the Scheme at the Scheme meeting.
All the directors of Rainbow who own Rainbow shares in their own right intend to
vote in favour of the Scheme.
6. THE ALTERNATIVE OFFER
6.1 Terms of the alternative offer
Subject to the Scheme failing as a result of the non- fulfilment of any of the
conditions precedent other than the regulatory approval required for the
implementation of the Scheme not being obtained, Remgro will offer to acquire
all Rainbow shares held by Rainbow shareholders (other than Remgro and its
subsidiaries), subject to the maximum that may be accepted in terms of the
alternative offer, as set out in paragraph 6.4 below.
6.2 Period of the alternative offer
The salient dates and times of the alternative offer, including the opening date
and closing date of the alternative offer, will be published on SENS and in the
South African press immediately following the failure of the
Scheme.
6.3 The alternative offer consideration
The alternative offer consideration will be:
6.3.1 a cash consideration of R16.00 for every Rainbow share held
by offer participants ("cash offer consideration"); or
6.3.2 8.1 Remgro shares for every tranche of 100 offer shares held
by offer participants ("share offer consideration"); or
6.3.3 a combination of cash and Remgro shares referred to in
paragraphs 6.3.1 and 6.3.2,
to be elected by Rainbow shareholders on condition that the share offer
consideration may only be elected in tranches of 100 Rainbow shares each. If
Rainbow shareholders elect to take (in whole or in part) the share offer
consideration, any fractional entitlements to Remgro shares will be settled in
cash in the amount of R19.75 per 0.1 of a Remgro share.
6.4 Maximum acceptances
Rainbow shareholders will only be entitled collectively to make acceptances of
the alternative offer for such number of Rainbow shares which does not exceed 80
460 000 in the aggregate. If acceptances are made by Rainbow shareholders (in
aggregate) which exceed 80 460 000 Rainbow shares, then each acceptance by each
Rainbow shareholder shall be deemed to be reduced pro rata in accordance with
the following formula:
80 460 000
___________ x Z
Y
Where
"Y" represents the aggregate number of Rainbow shares in respect of which the
alternative offer is accepted by all Rainbow shareholders, and;
"Z" represents the aggregate number of Rainbow shares in respect of which the
alternative offer is accepted by the relevant Rainbow shareholder.
All fractions arising from such calculation shall, if they are greater than or
equal to 0.5, be rounded up to the nearest whole number and if they are less
than 0.5, shall be rounded down to the nearest whole number. All Rainbow shares
which are not accepted as a result of the above reduction shall continue to be
held by the Rainbow shareholders concerned.
7. OPINIONS AND RECOMMENDATIONS REGARDING THE ALTERNATIVE OFFER
Investec, acting as independent adviser to the independent sub-committee and the
Rainbow Board, has considered the terms and conditions of the alternative offer
and is of the opinion that, at the date of issue of its fair and reasonable
opinion the cash offer consideration is fair and reasonable, and has advised the
independent sub-committee and the Rainbow Board accordingly. However Investec is
of the opinion that the share offer consideration is not fair and reasonable
based on a Remgro share price of R189 as at 30 April 2007 and has advised the
independent sub-committee and the Rainbow Board accordingly.
The independent sub-committee of the Rainbow Board has considered the terms and
conditions of the alternative offer and, taking into the account the opinion of
Investec, is of the unanimous opinion that the cash offer consideration is fair
and reasonable to Rainbow shareholders. However the
independent sub-committee of the Rainbow Board is of the opinion that the share
offer consideration is not fair and reasonable to Rainbow shareholders.
The independent sub-committee has recommended to the Rainbow Board that it
recommends to Rainbow shareholders that they accept the cash offer
consideration. However the independent sub-committee has recommended to the
Rainbow Board that it does not recommend to Rainbow shareholders that they
accept the share offer consideration.
The Rainbow Board, (other than Messrs Visser and Zwiegelaar who are
representatives of Remgro on the Rainbow Board and who have accordingly recused
themselves from expressing such an opinion) has considered the terms and
conditions of the alternative offer as well as the cash offer consideration and
share offer consideration and, taking into account the
opinion of Investec and the independent sub-committee, is of the opinion that
cash offer consideration is fair and reasonable to Rainbow shareholders and
recommends that Rainbow shareholders accept the cash offer consideration.
However the Rainbow Board is of the opinion that the share offer consideration
is not fair and reasonable and does not recommend that Rainbow shareholders
accept the share offer consideration.
8. RAINBOW DIVIDEND
Provided that Rainbow shareholders are registered as Rainbow
shareholders on the applicable dividend record date, Rainbow shareholders will
receive the Rainbow dividend for the period ended 31 March 2007. The Rainbow
dividend details will be announced on SENS and in the South African Press at the
time when Rainbow announces its financial results for the year ended 31 March
2007.
11 May 2007
Sponsor to Rainbow
Rand Merchant Bank (A Division of FirstRand Bank Limited)
Independent adviser to Rainbow
Investec Bank Limited
Attorneys to Rainbow
Routledge Modise
Attorneys
Reporting accountants to Rainbow
PricewaterhouseCoopers Inc
Chartered Accountants (SA)
Registered Accountants and Auditors
(Registration no 1998/012055/21)
Merchant bank and adviser to Remgro
Rand Merchant Bank
A Division of FirstRand Bank Limited
Sponsor to Remgro
Rand Merchant Bank (A Division of FirstRand Bank Limited)
Attorneys to Remgro
Hofmeyr Herbstein Gihwala Inc.
(Registration number 1997/001523/21)
Date: 11/05/2007 17:10:01 Produced by the JSE SENS Department.
