| Mon 9 Jun 2008, 8:16 | | WES - Wesco Investments Limited - Announcement to shareholders regarding the |
|
WES
WES
WES - Wesco Investments Limited - Announcement to shareholders regarding the
disposal of the company`s 25% interest in Toyota South Africa (Proprietary)
Limited (`TSA`)
Wesco Investments Limited
(Incorporated in the Republic of South Africa)
(Registration number 1968/005871/06)
Share code: WES ISIN: ZAE000007928
(`Wesco` or `the company`)
ANNOUNCEMENT TO SHAREHOLDERS REGARDING
THE DISPOSAL OF THE COMPANY`S 25% INTEREST IN
TOYOTA SOUTH AFRICA (PROPRIETARY) LIMITED (`TSA`)
1. Introduction
Further to the cautionary announcement dated 27 May 2008, the board of
directors of Wesco wishes to advise shareholders that the company has signed a
non-binding letter of intent in terms of which it proposes to dispose of its
25% interest in TSA (`the TSA interest`) to Toyota Motor Corporation of Japan
(`TMC`) (`the proposed disposal`), full details of which are contained in this
announcement.
The letter of intent governing the proposed disposal is non-binding and is
subject to the parties concluding a full definitive agreement in respect of the
proposed disposal, which it is anticipated will be subject to the conditions
precedent set out in paragraph 5 below.
2. Rationale for the proposed disposal
The proposed disposal represents the culmination of the process which commenced
in 2001 in terms of which TSA was de-listed and Wesco sold its controlling
interest in TSA to TMC. Given the passive nature of the investment in TSA and
the current turbulence in world markets, the board considered it to be in the
best interests of the company and its shareholders to accept the offer made to
it by TMC.
The proceeds of the proposed disposal, net of Capital Gains Tax, Secondary Tax
on Companies and prudent capital retention, will be distributed to shareholders
by way of dividend in due course.
3. Details of the proposed disposal
It is proposed that Wesco will dispose of the TSA interest for an amount of
R2 139 317 000, payable in cash against delivery of the relevant documents of
title to TMC.
4. Affected transaction
The proposed disposal will be effected in terms of section 228 of the Companies
Act, 1973 (as amended), and constitutes an affected transaction in terms of the
Securities Regulation Code on Take-overs and Mergers (`the Code`) issued by
the Securities Regulation Panel (`the SRP`). The Code accordingly requires the
board to obtain appropriate external advice and Charles Orbach & Company
Corporate Finance (Proprietary) Limited has bee n appointed to assist the board
in this regard.
5. Conditions precedent
The conditions precedent to which the proposed disposal will be subject are:
5.1 approval of the documentation required for implementation of the disposal
by the relevant regulatory bodies, including the JSE Limited (`the JSE`), the
SRP and the Exchange Control Department of the South African Reserve Bank;
5.2 ratification of the agreement in principle by the board of directors of
Toyota Motor Corporation of Japan at a board meeting;
5.3 approval of the proposed disposal and the resolutions required for
implementation thereof by the shareholders of the company in general meeting;
and
5.4 registration by the Registrar of Companies to the extent necessary of the
resolutions approved by the shareholders of the company.
6. Financial effects of the proposed disposal
The table below sets out the pro forma financial effects on Wesco of the
proposed disposal based on the audited financial statements of the company for
the financial year ended on 31 March 2008. These financial effects are the
responsibility of the directors of the company, are prepared for illustrative
purposes only and, because of their nature, may not fairly present the
financial position, changes in equity, results of operations or cash flows of
the company, after the disposal.
Before the After the Change
proposed proposed increase/
Note disposal disposal (decrease)
(cents) (cents) %
Earnings per share 1,3 1 015 12 003 1 082.5
Headline earnings per share 1,3 (352) 1 133 -
Tangible net asset value
per share 2,3 14 323 23 903 66.9
Net asset value per share 2,3 14 323 23 903 66.9
Number of shares in issue 8 441 800 8 441 800 -
Notes: applicable to `After the proposed disposal` only
1. On the assumption that the proposed disposal was effective throughout the
financial year ended on 31 March 2008 and that the consideration had been
invested in an interest bearing account earning 9% before tax for the period.
2. On the assumption that the proposed disposal was effective on 31 March
2008.
3. Costs and Capital Gains Tax amounting to approximately R177 million were
incurred prior to the effective date.
7. Effect of the proposed disposal on the listing of the company
The proposed disposal will result in the company being classified as a `cash
shell` in terms of the JSE Listings Requirements and should it, within a period
of six months after such classification, fail to enter into an agreement
relating to the acquisition of viable assets that satisfy the conditions for
listing in the JSE Listings Requirements, its listing will be suspended.
8. Circular to shareholders
A circular containing details of the proposed disposal and a notice convening a
general meeting of the company will be posted to the shareholders of Wesco
within 28 days of this announcement.
By order of the board.
Johannesburg
6 June 2008
Corporate advisor and sponsor
ARCAY MOELA
Arcay Moela Sponsors (Proprietary) Limited
(Registration number 2006/033725/07)
Auditors and reporting accountants
PRICEWATERHOUSECOOPERS
PricewaterhouseCoopers Inc.
Chartered Accountants (SA)
Registered Accountants and Auditors
(Registration on 1998/012055/21)
Independent professional advisor
CHARLES ORBACH & COMPANY
Corporate Finance (Proprietary) Limited
Date: 09/06/2008 08:16:01 Produced by the JSE SENS Department.
The SENS service is an information dissemination service administered by the
JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or
implicitly, represent, warrant or in any way guarantee the truth, accuracy or
completeness of the information published on SENS. The JSE, their officers,
employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature,
howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
