| Wed 7 Nov 2007, 13:54 | | BLU - Blue Label Telecoms - Announcement of a stra |
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JSE
BLU
BLU - Blue Label Telecoms - Announcement of a strategic relationship between
Blue Label Telecoms and Microsoft Corporation
Blue Label Telecoms And Microsoft Corporation
(Previously Friedshelf 776 (Proprietary) Limited)
(Incorporated in the Republic of South Africa)
(Registration number 2006/022679/07)
JSE Share code: BLU & ISIN: ZAE000109088
("Blue Label Telecoms" or "the Company")
Announcement of a strategic relationship between Blue Label Telecoms and
Microsoft Corporation
1. Introduction
Potential investors are referred to the Blue Label Telecoms abridged pre-
listing statement, released on SENS on Friday, 26 October 2007 ("the
Listing Announcement") for the terms of the proposed listing of Blue Label
Telecoms.
Potential investors are advised that, subsequent to the release of the
Listing Announcement and the Pre-Listing Statement, Microsoft Corporation
("Microsoft") and Blue Label Telecoms have entered into agreements to
establish a strategic relationship in terms of which:
- Microsoft will acquire approximately 12% of the issued share capital of
Blue Label Telecoms by way of a purchase and subscription for shares in the
forthcoming listing of Blue Label Telecoms ("the Investment Agreement");
and
- Microsoft and Blue Label Telecoms will collaborate on a preferred
partnership basis to drive services and products in developing economies
and to exercise commercially reasonable efforts to provide mutual
assistance to one another in exploring new business opportunities ("the
Collaboration Agreement").
There has been no change to the information provided in the Pre-Listing
Statement other than that disclosed in this announcement.
2. Rationale and salient terms of the collaboration agreement
The strategic relationship entered into between Blue Label Telecoms and
Microsoft brings to the fore a congruence between Blue Label Telecoms`
stated strategy of establishing a global transactional services platform in
emerging markets with Microsoft`s intention to deliver products, services
and advertising, through the Blue Label Telecoms distribution network. The
main purpose of the collaboration agreement is for Microsoft and Blue Label
Telecoms to derive revenue (through an agreed revenue share model) by the
channeling of advertising into Blue Label Telecom`s distribution base.
Microsoft will support Blue Label Telecoms` effort to increase its global
footprint of contact points with customers through an accelerated
deployment of a distribution and sales network that includes enhanced-
feature point of sale ("POS"), mobile and other devices and the associated
support and service platforms. Microsoft will provide Blue Label Telecoms
with advertising services as well as access and licenses to various web-
based and mobile technologies and services.
Blue Label Telecoms and Microsoft will exercise commercially reasonable
efforts to provide mutual assistance to one another in exploring new
business opportunities.
3. Terms of the Investment Agreement
Microsoft will acquire approximately 12% of the issued share capital of
Blue Label Telecoms through:
- the acquisition by Microsoft of approximately 7.5% of the fully
diluted ordinary share capital of Blue Label Telecoms after the
Private Placing and the Investment Agreement at the Private Placing
Price, of which approximately 5.5% will be from the Offer for Sale and
the Further Allotment Option and approximately 2% from other Blue
Label Telecoms Shareholders ("the Microsoft Share Acquisition"); and
- a specific issue of Blue Label Telecoms ordinary shares for cash to
Microsoft at the Private Placing Price, representing approximately
4.5% of the aggregate fully diluted ordinary shares in issue after the
Private Placing and the Investment Agreement ("the Microsoft Share
Issue").
4. Conditions precedent to the Investment and Collaboration Agreement
The Investment and Collaboration Agreement are conditional upon the listing
of the Blue Label Telecoms Shares on the main board of the JSE Limited.
5. Forecast and pro forma financial information
There is no material change, being greater than 3%, to the forecast and the
pro forma financial information disclosed in paragraph 23 of the Pre-
Listing Statement as a result of the Investment Agreement. The impact of
the Collaboration Agreement on the forecast and pro forma financial
information has not been considered. The forecast and the pro forma
financial information is the responsibility of the Directors of Blue Label
Telecoms. The impact of the investment agreement on the forecast and pro
forma financial information has been reviewed by the Reporting Accountants
and Auditors.
6. Salient dates and times
The salient dates in relation to the listing of the Blue Label Telecoms
Shares on the JSE remain unchanged. The Private Placing opened at 09:00 on
Monday, 29 October 2007 and is expected to close at 12:00 on Thursday, 8
November 2007. Applicants to the Private Placing, who have submitted their
applications prior to the release of this announcement, will be allowed to
revise or resubmit their applications before 12:00 on Thursday, 8 November
2007.
Johannesburg,
7 November 2007
Investment bank Legal advisor Reporting Accountants and Auditors
and sponsor
Investec Limited JAVA Capital PricewaterhouseCoopers
Date: 07/11/2007 13:54:15 Produced by the JSE SENS Department.
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