| Mon 1 Oct 2007, 17:16 | | LAB - Labat - Announcement And Renewal Of Cautiona |
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LAB
LAB
LAB - Labat - Announcement And Renewal Of Cautionary Announcement
LABAT AFRICA LIMITED
Incorporated in the Republic of South Africa
(Registration number 1986/001616/06)
Share code: LAB & ISIN: ZAE000018354
("Labat" or "the company")
PRO FORMA FINANCIAL EFFECTS OF THE TRANSACTIONS WHICH INTRODUCED
MVELAPHANDA HOLDINGS (PROPRIETARY) LIMITED AS A STRATEGIC EMPOWERMENT
PARTNER INTO LABAT TRAFFIC SOLUTIONS (PROPRIETARY) LIMITED AND A RENEWAL OF
CAUTIONARY
1. INTRODUCTION
Further to the announcement released on SENS on 27 July 2007, in which
Labat shareholders were advised that agreements had been concluded
between Labat, Labat Traffic Solutions (Proprietary) Limited ("LTS",
an unlisted subsidiary of Labat), Mvelaphanda Holdings (Proprietary)
Limited ("Mvela", a black economic empowerment investment company),
and the current minority shareholders of LTS, which governed the
acquisition by Mvela of all of the minority shareholdings in LTS
("acquisition"), the subscription by Mvela for 2 600 preference shares
in LTS ("issue of the preference shares") and the repurchase by LTS of
21,54% of its issued shares from Mvela ("share buy-back") (hereinafter
"the acquisition", "the share buy-back" and "the issue of the
preference shares" are collectively referred to as "the
transactions"), Labat shareholders are advised that the pro forma
financial effects of the transactions have now been finalised. The
financial effects have been included in a circular to shareholders
dated 27 September 2007.
2. PRO FORMA FINANCIAL EFFECTS OF THE TRANSACTIONS
Set out in the table below, are the unaudited pro forma financial
effects on the audited final results of the company for the year ended
28 February 2007. The pro forma financial effects reflect the impact
that the issue of the preference shares and the share buy-back might
have had on the earnings per share and the headline earnings per share
of Labat had the issue of the preference shares and the share buy-back
been effected on 1 March 2006, and the effect that the issue of the
preference shares and the share buy-back might have had on the net
asset value per share and the net tangible asset value per share had
the share buy-back been effected on 28 February 2007. The pro forma
financial effects, which are the responsibility of the directors, are
provided for illustrative purposes only and, because of their pro
forma nature may not fairly present Labat`s financial position,
changes in equity, results of operations or cash flows.
Before1 After2 % change
Loss per share3 (cents) (34,8) (36,4) (4,60)
Headline loss per share3 (cents) (20,5) (22,0) (7,32)
NAV per share4 (cents) 13,15 4,40 (66,41)
NTAV per share4 (cents) 9,14 0,06 (99,34)
Number of shares in issue 186 415 186 415 -
throughout the period 000`s
Notes:
1. The "Before" column has been extracted from the audited final
results of Labat for the year ended 28 February 2007.
2. The "After" column contains the pro forma earnings per share,
headline earnings per share, net asset value per share and net
tangible asset value per share after taking into consideration
the issue of the preference shares and the share buy-back.
3. The calculation of earnings per share and the headline earnings
per share in the "After" column, assumes that the share buy-back
was effected on 1 March 2006, based on the weighted average
number of shares during the year, and takes into account the
effect of the following:
a. an annual dividend coupon on the preference shares of 12%;
and
b. the share buy-back of 21,54% of Mvela`s shareholding in LTS,
the resultant decrease of the effective minority
shareholding in LTS and an effective 14% increase in Labat`s
shareholding in LTS.
4. The calculation of net asset value and net tangible asset value
per share in the "After" column, assumes that the share buy-back
was effected on 28 February 2007, based on the number of shares
in issue on 28 February 2007 and takes into account the
following:
a. the issue of the preference shares;
b. the effect of the share buy-back; and
c. that the consolidated reserves of LTS will be in excess of
d. the proposed share buy-back and STC thereon.
3. INTENTION REGARDING THE LISTING OF LTS
The board of Labat intends to continue the process of unlocking
shareholder value through the restructuring of the group. The
transactions constitute the first step towards increasing LTS`s BEE
profile by introducing Mvela as a strategic partner in LTS and thus
positioning LTS for a separate listing on the JSE. Negotiations are
underway between LTS and various other parties with a view to
constituting Total Computer Systems (Proprietary) Limited as a wholly-
owned subsidiary of LTS. It is furthermore intended to procure the
unbundling and eventual delisting of Labat.
4. RENEWAL OF CAUTIONARY
Shareholders are advised that Labat is still engaged in negotiations
which, if successfully concluded, may have a material effect on the
price of Labat shares. Accordingly, shareholders are advised to
continue exercising caution when trading in Labat shares on the JSE
until a further announcement is made.
1 October 2007
Sponsor
Merchant Sponsors (Proprietary) Limited
Reporting Accountants to Labat
Greenwood Chartered Accountants
Date: 01/10/2007 17:16:07 Produced by the JSE SENS Department.
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