| Fri 25 May 2007, 13:55 | | CBS - CBS Property Portfolio Limited - Update on t |
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CBS
CBS
CBS - CBS Property Portfolio Limited - Update on the offer by the GEPF to
acquire all the CBS linked units in issue
CBS Property Portfolio Limited
(Incorporated in the Republic of South Africa)
Registration number: 2003/009523/06)
Share code: CBS & ISIN: 000073995
("CBS")
Public Investment Corporation
(Incorporated in the Republic of South Africa)
(Registration number 2005/009094/06)
Update on the offer by the Government Employees Pension Fund ("GEPF"), as duly
represented by the Public Investment Corporation, to acquire all the CBS linked
units in issue
1 Introduction
The holders of linked units in CBS ("CBS linked unitholders") are referred to
the announcement dated 22 March 2007 wherein it was announced that the GEPF, as
duly represented by the Public Investment Corporation, (collectively hereinafter
referred to as the "PIC"), has made an offer to acquire all the CBS linked units
in issue ("CBS linked units"), other than those already held by the PIC (the
"Offer" or "proposed transaction").
The proposed transaction is subject to the fulfilment of certain suspensive
conditions as set out in the announcement of 22 March 2007. The status of
fulfilment of the outstanding suspensive conditions is set out in paragraph 8
below.
CBS linked unitholders are informed that a circular regarding the Offer by the
PIC to CBS linked unitholders to acquire all of their CBS linked units in terms
of section 440A of the Companies Act, No. 61 of 1973, as amended, for a clean
cash consideration of R12 (i.e. excluding the interim distribution and
special distribution referred to in 2 below) for every 1 CBS linked unit held
("offer consideration"), has been posted today.
2 Interim and special distribution
The CBS board, in addition to its interim distribution for the period ending 30
April 2007 ("the interim distribution"), the detail of which is expected to be
announced on or about the week ending 8 June 2007, will make a further
distribution to eligible CBS linked unitholders which distribution will be in
line with current business practice adopted by the CBS board of distributing
available cash generated, from the end of the previous distribution period being
30 April 2007 to the last day to trade in order for CBS linked unitholders to
participate in the Offer ("last day to trade"), which will be announced as
outlined in the timetable in paragraph 3 below ("special distribution").
The special distribution will be made to all CBS linked unit holders recorded in
the CBS unitholder register on the record date. The PIC will not be entitled to
either the interim distribution or the special distribution in respect of the
CBS linked units acquired by it from the opening date of the offer until the
closing date of the offer ("offer period"), from the CBS linked unit holders
that have accepted the Offer and that have tendered their CBS linked units ("the
offer participants").
In this respect, the offer participants that have already accepted the Offer
during the offer period and that are no longer recorded in the register on the
record date will still receive the special distribution.
3 Salient dates and times
The salient dates and times of the Offer are set out below:
2007
Circular posted to CBS linked unitholders Friday, 25 May
on
Opening date of the Offer at 09:00 on Friday, 25 May
Announcement of the closing date of the Fourteen days prior to the
offer and details of the special closing date of the Offer
distribution
Last day to trade in order for CBS linked Five business days prior to
unitholders to participate in the Offer the closing date of the
and to qualify for the special Offer
distribution
CBS linked units trade ex the right to Four business days prior to
participate in the Offer and to qualify the closing date of the
for the special distribution Offer
Record date on which CBS linked The closing date of the
unitholders must be recorded in the Offer
register in order to participate in the
Offer and to qualify for the special
distribution
Closing date of the Offer at 12:00 The Offer will remain open
for a minimum of 21 days in
terms of the Securities
Regulation Panel Code and
until the offer becomes
unconditional
Payment of the special distribution The next business day after
the closing date of the
Offer
Results of the Offer announced on the Within three business days
Securities Exchange News Service of the closing date of the
Offer
Results of the Offer published in the Within four business days
South African press of the closing date of the
Offer
Offer consideration posted to offer Within seven days of the
participants who have not dematerialised Offer being accepted and
their CBS linked units becoming unconditional
subject to receipt of the
form of acceptance,
surrender and transfer
(blue) and the documents of
title by the transfer
secretaries
Offer consideration credited to the Within seven days of the
Central Securities Depository Participant Offer being accepted and
or broker, as the case may be, of offer becoming unconditional
participants who have dematerialised subject to the receipt of
their CBS linked units and whose notification by the
acceptance of the Offer has been received transfer secretaries
by the transfer secretaries
4 Financial effects
The unaudited pro forma financial effects are the responsibility of the CBS
directors and have been prepared for illustrative purposes only, in order to
provide information on how the offer might affect the financial results and
position of a CBS linked unitholder. Because of their nature, the unaudited pro
forma financial effects may not give a true reflection of the actual financial
effects of the offer.
The table below sets out the unaudited pro forma financial effects of the Offer
on a CBS linked unitholder. The pro forma income statement effects and the pro
forma balance sheet effects are based on the audited results of CBS at 31
October 2006:
Per CBS linked unit Before After the Change
the Offer Offer (%)
Distribution (cents)(1)(2) 72 90 25%
Market value (cents)(3) 975 1 200 23%
NAV(cents)(1) 830 1 200 45%
Notes:
(1) The figures displayed in the "Before the Offer" column have been
extracted from the CBS Annual Report for the period ending 31 October 2006.
(2) The "After the Offer" distribution represents the interest earned on
the Offer consideration of 1 200 cents per CBS linked unit, for a period of
12 months, at a call rate of 7.5%.
(3) The "Before the Offer" market value represents the 30 day volume
weighted average price of a CBS linked unit prior to the date of the
cautionary announcement released on 2 February 2007.
5 Opinion of the independent sub-committee
A duly appointed independent sub-committee ("independent sub-committee") of the
CBS board of directors ("CBS board") has considered the terms of the Offer, and
after taking into account an independent opinion obtained from Ernst & Young
Advisory Services Limited ("EYASL"), is of the opinion that the terms of the
Offer are fair and reasonable to the CBS linked unitholders.
6 Opinion of the CBS board
The CBS board has considered the terms of the Offer and taking into account the
opinion of EYASL and the independent sub-committee, is of the opinion that the
terms of the Offer are fair and reasonable and recommend that CBS linked
unitholders accept the Offer.
7 Acquisition of CBS linked units
At the date of this announcement the PIC holds 57,278,859 CBS linked units,
being 30.37% of the CBS linked units in issue at the date of this announcement.
The PIC acquired 47,217,130 CBS linked units for cash during the 6 month period
prior to the date of this announcement. The highest price paid by the PIC was
R12 per CBS linked unit.
8 Suspensive conditions
In respect of the status of fulfilment and/or waiver, as the case may be, of the
various suspensive conditions to the proposed transaction:
8.1 The approval of the proposed transaction by the Competition Authorities is
still required.
8.2 The suspensive condition to the Offer that CBS directors and management
irrevocably undertake to accept the Offer, and thereafter the successful
tendering of not less than 30 million CBS linked units (comprising
approximately 15.91% of the CBS linked units in issue) held directly or
indirectly by themselves has partially been fulfilled in that CBS directors
and management have irrevocably undertaken to accept the Offer in respect
of 30,056,185 CBS linked units, but have not tendered these units as yet in
terms of the Offer.
8.3 The suspensive condition that the PIC obtain sufficient irrevocable
undertakings from CBS linked unitholders to accept the Offer and thereafter
the successful tender of sufficient CBS linked units in terms of the Offer,
such that on implementation of the Offer the PIC will hold not less than
50.01% of the CBS linked units in issue has also partially been fulfilled
as the PIC has subsequent to the Offer being proposed, received irrevocable
acceptances of the Offer from CBS linked unitholders holding 62,315,179 CBS
linked units (comprising approximately 33.04% of the CBS linked units in
issue) but have not tendered these units as yet in terms of the Offer.
8.4 Pursuant to the irrevocable undertakings referred to in 8.2 and 8.3 above,
on implementation of the Offer, the PIC will hold at least 119,594,038 CBS
linked units (comprising approximately 63.41% of the CBS linked units in
issue should all the CBS linked units as represented by the irrevocable
acceptances be tendered in terms of the Offer), which will therefore then
ensure fulfilment of such suspensive conditions.
9 Withdrawal of cautionary announcement
CBS linked unitholders are referred to the cautionary announcements dated 2
February 2007 and 22 March 2007, and are advised that caution is no longer
required to be exercised by CBS linked unitholders when dealing in their CBS
linked units.
Cape Town
25 May 2007
Investment bank to the PIC Investment bank to CBS Sponsor to CBS
Nedbank Capital Investec Corporate Investec Bank Limited
Finance
Attorneys to CBS Independent expert to
CBS
Jowell Glyn & Marais EYASL
Date: 25/05/2007 13:55:01 Produced by the JSE SENS Department.
