| Tue 4 Mar 2008, 14:00 | | TRE / MOB - Trencor / Mobile - Sale Of Trenstar I |
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MOB TRE
MOB TRE
TRE / MOB - Trencor / Mobile - Sale Of Trenstar, Inc`s Asset Based
Businesses In The Us
TRENCOR LIMITED
(Incorporated in the Republic of South Africa)
(Registration No 1955/002869/06)
Share Code: TRE
ISIN: ZAE000007506
("Trencor")
MOBILE INDUSTRIES LIMITED
(Incorporated in the Republic of South Africa)
(Registration No 1968/014997/06)
Share Code: MOB
ISIN: ZAE000091435
("Mobile")
SALE OF TRENSTAR, INC`S ASSET BASED BUSINESSES IN THE US
In the 22 February 2008 announcement of Trencor`s year-end results for 2007, we
reported that, in the context of attaining greater focus on Trencor`s core
marine container businesses, the assets and liabilities of TrenStar, Inc (58%
held by Trencor) had been categorised as "held for sale".
We are pleased to announce that in line with this strategy, TrenStar, Inc has
sold its three operating subsidiaries active in North America in the leasing and
management of kegs and other types of metal cages and bins used in the beer,
synthetic rubber and food industries to a subsidiary of Macquarie Group Limited.
The provisional consideration payable for these businesses is US$72 million,
US$5 million of which will be placed in escrow for certain periods pending the
outcome of warranties given in the sale. An additional payment of up to US$5
million may also be made to TrenStar, Inc subject to the sold entities achieving
certain revenue and EBITDA (earnings before interest, tax, depreciation and
amortisation) targets during 2008 and 2009. TrenStar, Inc. was represented by
Morgan Keegan and Latham & Watkins LLP in the sale.
The purchase consideration enabled repayment of all bank debt in the sold
subsidiaries as well as at TrenStar, Inc (head office) level, leaving the
TrenStar, Inc group free of bank debt and with net cash of approximately US$15
million after providing for all costs associated with the sale (assuming the
amounts in escrow and those subject to achieving the revenue and EBITDA targets
are received). In addition to this cash, and with the company having
successfully exited its UK/European beer keg operations earlier during 2007, the
remaining assets of TrenStar, Inc comprise its 33% interest in Jettainer GmbH
(the joint venture company with Lufthansa Cargo AG engaged in providing and
managing air cargo containers, and based in Frankfurt, Germany) and its Track &
Trace business. Plans for these businesses remain under strategic review.
In Trencor`s said announcement of results to 31 December 2007, we advised that
in view of the "held for sale" status of the assets and liabilities of the
TrenStar companies, they had in the said results been treated for accounting
purposes as "discontinued operations". Thus the effects of the above
transaction do not impact the results of Trencor`s continuing operations and
headline earnings as published on 22 February 2008. However, the settlement of
all bank debt in TrenStar, Inc reported above reduces the Trencor group
consolidated gearing ratio of 92% (2006: 174%) as published to 85%.
Cape Town
4 March 2008
Sponsor
Rand Merchant Bank (A division of FirstRand Bank Limited)
www.trencor.net
www.mobile-industries.net
Date: 04/03/2008 14:00:52 Produced by the JSE SENS Department.
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