| Fri 12 Oct 2007, 14:27 | | Disposal of RAH`s 45% interest in Life Esidimeni G |
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RAH
RAH
RAH - Real Africa Holdings Limited - Disposal Announcement
Real Africa Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number 1994/003919/06)
Share code: RAH & ISIN: ZAE000008702
("RAH")
Disposal of RAH`s 45% interest in Life Esidimeni Group Holdings (Proprietary)
Limited ("Life Esidimeni") and declaration of special dividend
1. Introduction
Investec Bank Limited is authorised to announce that an agreement has been
reached between RAH and Life Healthcare Group (Proprietary) Limited ("LHG"),
whereby LHG will acquire RAH`s 45% stake in Life Esidimeni ("the disposal"). LHG
is the current owner of the other 55% interest in Life Esidimeni.
2. Nature of business of Life Esidimeni
Life Esidimeni provides district hospital and health services on contract to
provincial governments in South Africa.
3. Rationale for the disposal
RAH has a stated intention of focusing on gaming investments and as such has
over the past 12 months disposed of its interest in Ocfish Holdings Limited and
increased its stake in Afrisun Leisure Investments (Proprietary) Limited. The
remaining significant non gaming investment is the 45% shareholding in Life
Esidimeni.
4. Salient terms of the disposal
The purchase consideration of R180 million will be paid by LHG on 17 October
2007.
The proceeds net of capital gains tax will be applied to settle preference share
funding of R50million and the balance will be distributed as a special dividend
to shareholders.
5. Life Esidimeni pension fund exposure
As previously reported in RAH`s annual financial statements for the year ended
31 March 2006, the Lifecare Group Holdings Pension Fund has been the subject of
a Financial Services Board inspection. Life Esidimeni has a potential exposure
to a financial settlement in respect of this fund. In terms of the sale
agreement, RAH has warranted its share of the pension fund exposure in the
company which is capped at the proceeds received from the sale. RAH has raised
a provision of R18 million for its share of the provision held in Life
Esidimeni, however a contingent liability exists in terms of the warranty given.
6. Unaudited pro forma financial effects of the disposal
The unaudited pro forma financial effects set out below have been prepared for
illustrative purposes only to assist RAH shareholders to assess the impact of
the disposal on the earnings per share ("EPS"), headline earnings per share
("HEPS"), net asset value per share ("NAV") of RAH. The unaudited pro forma
financial effects are based on RAH`s audited results for the 15 months ended 30
June 2007.
These unaudited pro forma financial effects have been disclosed in terms of the
JSE Limited ("JSE") Listings Requirements and because of their nature may not
fairly present RAH`s financial position, changes in equity, results of
operations or cash flows. The unaudited pro forma financial effects are the
responsibility of the directors of RAH.
Before After %
disposal disposal Change
(cents) (cents)
EPS 69.7(I) 91.8(ii) 32%
HEPS 28.0(i) 26.3(ii) -6%
NAV 317.7(iii) 341.5(iv) 7%
Notes:
(i) The EPS and HEPS, as set out in the "Before the disposal" column of the
table, are based on the audited income statement of RAH for the 15 month
period ended 30 June 2007 and 361.3 million shares in issue.
(ii) The EPS and HEPS, as set out in the "After the disposal" column of the
table, are based on the audited income statements of RAH for the 15 month
period ended 30 June 2007; the consideration being paid at the beginning of
the year; and an interest rate of 68% of prime is applicable on the
proceeds.
(iii) The NAV per share, as set out in the "Before the disposal" column of
the table, is based on the audited balance sheet of RAH at 30 June 2007 and
361.3 million shares in issue.
(iv) The NAV per share, as set out in the "After the disposal" column of the
table, is based on the audited balance sheet of RAH at 30 June; 361.3
million shares in issue; and the assumptions that the disposal became
effective at the end of the year.
7. Categorisation of the disposal
The disposal has been categorised as a category 3 transaction in terms of
section 9.5(a) of the JSE Listings Requirements.
Declaration of special dividend
Notice is hereby given that a special dividend of 35 cents per share has been
declared, payable to shareholders recorded in the register of the company at the
close of business on the record date appearing below. The salient dates
applicable to the special dividend are as follows:
2007
Last day to trade cum special dividend Friday, 26 October
First day to trade ex special dividend Monday, 29 October
Record date Friday, 2 November
Payment date Monday, 5 November
No share certificates may be dematerialised or rematerialised between Monday, 29
October 2007 and Friday, 2 November 2007, both days inclusive. Dividend cheques
will be posted and electronic payments made, where applicable, to certificated
shareholders on the payment date. Dematerialised shareholders will have their
accounts with their Central Securities Depository Participant or broker credited
on the payment date.
By order of the board
Sun International Corporate Services (Pty) Limited, Secretaries
Sandton
12 October 2007
Investment Bank
Investec Corporate Finance
Sponsor
Investec Bank
Attorneys
Edward Nathan Sonnenbergs
Date: 12/10/2007 14:00:01 Produced by the JSE SENS Department.
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