| Mon 4 Feb 2008, 9:40 | | CNL - Control Instruments - Repurchase of ordinary shares in Control |
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CNL
CNL
CNL - Control Instruments - Repurchase of ordinary shares in Control
Instruments
CONTROL INSTRUMENTS GROUP LIMITED
(Incorporated in the Republic of South Africa)
(Registration number: 1964/003987/06)
JSE Share Code: CNL
ISIN: ZAE000001665
("Control Instruments" or "the Company")
REPURCHASE OF ORDINARY SHARES IN CONTROL INSTRUMENTS
1 Introduction
Control Instruments announced on 18 December 2007 that it was going to
implement a programme to repurchase shares to a total value of
approximately R25 million.
In terms of the general authority granted to Control Instruments to
repurchase its ordinary shares by a special resolution passed by Control
Instruments shareholders at the annual general meeting held on 19 June
2007, a maximum of 27 887 351 ordinary shares (being 20% of the issued
share capital) could be acquired ("the general authority").
2 Implementation
In terms of paragraph 11.27 of the JSE Limited ("JSE") Listings
Requirements, Control Instruments announces that it has acquired, through
the order book operated by the JSE trading system, 7 922 574 ordinary
shares, which is equivalent to 5.68% of the issued share capital at the
time of the granting of the general authority, for a total consideration
of R10 750 376. The repurchases were carried out between 18 December 2007
and 31 January 2008. The highest price paid was R1.50 per share, the
lowest price paid was R1.30 per share and the average price paid was
R1.36 per share.
The Company`s current issued share capital is 139 436 754 ordinary shares
of five cents each. This includes 16 925 120 shares that are held in
treasury.
The extent of the general authority outstanding is 19 964 777 ordinary
shares, which is equivalent to 14.32% of the total number of shares in
issue. In terms of its share repurchase programme, the Company may still
acquire shares to the value of approximately R14 million.
The repurchase of these shares have complied with the requirements of
paragraph 5.72 of the JSE Listings Requirements.
3 Source of funds
The repurchases have been funded from available cash. It is intended that
future purchases will also be funded from available cash.
4 Opinion of the directors
The directors of Control Instruments have considered the impact of the
share repurchase programme and are of the opinion that:
* Control Instruments and its subsidiaries will be able, in the ordinary
course of business, to pay their debts for a period of twelve months from
the date of this announcement;
* the consolidated assets of Control Instruments and its subsidiaries,
fairly valued, are in excess of the consolidated liabilities of Control
Instruments and its subsidiaries, the assets and liabilities being
recognised and measured in accordance with the accounting policies used
in the audited annual financial statements for the year ended 31 December
2006;
* the working capital of Control Instruments and its subsidiaries will be
adequate for ordinary business purposes for a period of twelve months from
the date of this announcement; and
* the share capital and reserves of Control Instruments and its subsidiaries
will be adequate for the ordinary business purposes for a period of twelve
months from the date of this announcement.
5 Unaudited pro forma financial effects of the repurchase
The unaudited pro forma financial effects set out below have been prepared
for illustrative purposes only to assist the shareholders of Control
Instruments to assess the impact of the share repurchase on the earnings per
share ("EPS"), headline earnings per share ("HEPS") and net asset value
("NAV") per share of Control Instruments. The unaudited pro forma financial
effects are based on Control Instruments` unaudited results for the six
months ended 30 June 2007.
These unaudited pro forma financial effects have been disclosed in terms of
the JSE Listings Requirements and because of their nature may not fairly
present Control Instruments` financial position, changes in equity, results
of operations or cash flows. The unaudited pro forma financial effects are
the responsibility of the directors of Control Instruments.
Before(i) After TeliMatrix After the Change %
Cents and sale of OEM repurchase (vii)
plastics Cents
operations (iv)
Cents
EPS (6 months) 18.4 (ii) 351.0 (v) 378.5(viii) 7.8
HEPS (6 months) (7.0) (ii) (14.9) (v) (16.9)(viii) 13.3
NAV per share 423 (iii) 320 (vi) 332 (ix) 3.7
Notes:
(i) The "Before" column of the table refers to Control Instruments before the
sale of its fleet management businesses to TeliMatrix Limited
("TeliMatrix"); the sale of its OEM plastics operations; and the share
repurchase.
Readers are referred to:
* the circular to shareholders, dated 13 September 2007, regarding the sale
by Control Instruments of its shares in CI OmniBridge and OmniBridge
Cyprus to TeliMatrix; and the unbundling to shareholders of the shares in
TeliMatrix held by Control Instruments at the time of the listing of
TeliMatrix; and
* the announcement, dated 29 November 2007, regarding Control Instrument`s
agreement to sell its original equipment manufacture ("OEM") automotive
plastics operations to Smiths Plastics (Proprietary) Limited.
(ii) The EPS and HEPS, as set out in the "Before" column of the table,
are based on the unaudited income statement of Control Instruments
for the six months ended 30 June 2007 and 106 177 000 weighted
average number of shares in issue.
(iii) The NAV per share, as set out in the "Before" column of the table,
is based on the unaudited balance sheet of Control Instruments at 30
June 2007 and 130 434 208 shares in issue.
(iv) The "After TeliMatrix and sale of OEM plastics operations" column
of the table refers to Control Instruments after the sale of its
fleet management businesses to TeliMatrix and the disposal of the OEM
plastics operations.
* The sale to TeliMatrix reflects that Control Instruments received 320
million shares in TeliMatrix (representing 50% of the share capital of
TeliMatrix) in consideration for the sale. Approximately 280 million of
these TeliMatrix shares were unbundled to Control Instruments
shareholders and approximately 40 million were sold. The profit on the
sale of the fleet management businesses of R410 million was calculated
using the closing price of the TeliMatrix shares on the day it listed on
the JSE Limited, being R1.80.
* Control Instruments has agreed to sell its OEM automotive plastics
operations (Ariston and Specialised Plastics Engineering) to Smiths
Plastics (Proprietary) Limited, a subsidiary of Metair Investments
Limited. The purchase consideration is R19.5 million plus an adjustment
for stock, debtors and creditors. This will represent the tangible net
asset value at the effective date.
(v) The EPS and HEPS, as set out in the "After TeliMatrix and sale
of OEM plastics operations" column of the table, are based on the
unaudited income statement of Control Instruments for the
six months ended 30 June 2007 and 106 177 000 weighted average
number of shares in issue; the assumptions that, at the beginning of
the six month period:
* the TeliMatrix shares were received and either unbundled or sold and
the cash was received;
* the sale of the OEM plastics operations became effective and the
consideration was received; and
* the cash received was deposited in an account earning interest of
10.0% nominal annual compounded quarterly.
(vi) The NAV per share, as set out in the "After TeliMatrix and
sale of OEM plastics operations" column of the table, is based
on the unaudited balance sheet of Control Instruments at 30 June
2007 and 130 434 208 shares in issue; the assumptions that, at the
end of the six month period:
* the TeliMatrix shares were received and either unbundled or sold and the
cash was received; and
* the sale of the OEM plastics operations became effective and the
consideration was received.
(vii) The "After the repurchase" column of the table refers to Control
Instruments after the repurchase of 7 922 574 ordinary shares,
representing 5.68% of the issued shares of the Company.
(viii) The EPS and HEPS, as set out in the "After the repurchase" column of
the table, are based on the unaudited income statement of Control
Instruments for the six months ended 30 June 2007 and 98 254 426
weighted average number of shares in issue; the assumptions detailed
in point (v) above and the assumptions that the shares were
repurchased at the beginning of the six month period; and the
repurchases were financed using cash.
(iX) The NAV per share, as set out in the "After the repurchase" column
of the table, is based on the unaudited balance sheet of Control
Instruments at 30 June 2007 and 122 551 634 shares in issue; the
assumptions detailed in point (vi) above and the assumptions that
the shares were repurchased at the end of the six month period; and
the repurchases were financed using cash.
6 JSE listing
All the shares have been repurchased by a subsidiary of Control
Instruments and are being held in the subsidiary company as treasury
stock.
Cape Town
4 February 2008
Sponsor
Investec Bank Limited
Date: 04/02/2008 09:40:01 Produced by the JSE SENS Department.
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