| Wed 17 Sep 2008, 15:00 | | CUH / BFS - Credit U - Further Announcement Re Firm Offer By Blue To Acquire The |
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BFS CUH JCD
BFS CUH
CUH / BFS - Credit U - Further Announcement Re Firm Offer By Blue To Acquire The
Entire Ordinary Share Capital Of Credit U Not Held By Credit U`s Share
Incentive Scheme
CREDIT U HOLDINGS LIMITED
(formerly Kagisano Holdings Limited)
(Incorporated in the Republic of South Africa)
(Registration number: 2002/003827/06)
Share code: CUH & ISIN: ZAE000115085
("Credit U")
BLUE FINANCIAL SERVICES LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1996/006595/06)
Share code: BFS & ISIN: ZAE000039681
("Blue")
FURTHER ANNOUNCEMENT RE FIRM OFFER BY BLUE TO ACQUIRE THE ENTIRE ORDINARY SHARE
CAPITAL OF CREDIT U NOT HELD BY CREDIT U`s SHARE INCENTIVE SCHEME
1 INTRODUCTION
1.1 Further to the joint-announcement published by Credit U and Blue on 7
August 2008 (the "original announcement"), shareholders of Credit U are
advised that, as envisaged in the announcement, Blue has submitted to the
board of directors of Credit U a letter confirming that additional
underwriters for an amount of R136.4 million have been secured to
participate in the vendor consideration placing relating to the firm
intention by Blue to make an offer to acquire the entire issued ordinary
share capital of Credit U excluding the 2 250 000 treasury shares held by
the Employee Share Incentive Scheme ("the offer" or "the acquisition").
1.2 Furthermore, Blue deems it prudent to reduce the exposure of Mr Dave van
Niekerk and therefore allocated a portion of the additional funds secured
against the original funds made available by Mr Dave van Niekerk. In this
regard, Mr Riaan Swart has been included as a co-first underwriter with Mr
Dave van Niekerk in terms of the first 50% of Blue ordinary shares (i.e.
22.25 out of 44.5 Blue ordinary shares) receivable by Credit U shareholders
amounting to R139.1 million.
1.3 As to the remaining 50% of the Blue ordinary shares (i.e. 22.25 out of 44.5
Blue ordinary shares) receivable by Credit U shareholders, 70% of such
shares (being 15.575 shares) can be placed with the second underwriters in
cash. Details pertaining to the second underwriters are provided below.
Consequently the maximum cash exposure in terms of the vendor consideration
placing (should all the minority shareholders elect to place their shares
for cash) is R236.5 million (i.e. Credit U shareholders will be entitled to
receive 85% of the purchase consideration in cash and 15% in Blue ordinary
shares).
1.4 In addition, subsequent to the original announcement, irrevocable
undertakings have been obtained from key Credit U shareholders bringing the
total percentage of holders of the total issued shares of Credit U who have
undertaken to accept the offer in terms of the transaction, to 78.6%. This
translates to the holders of 80.2% of all scheme shares.
1.5 It is hereby noted that this announcement does not constitute a revised or
amended firm intention to make an offer but is issued solely to provide
further information pertaining to the additional underwriters as envisaged
and referred to in the Firm Offer letter dated 7 August 2008 ("Firm Offer")
and the original announcement and the cash allocation relating to the
remaining 50% of the Blue ordinary shares receivable by Credit U
shareholders.
This announcement summarises the information provided in the letter of firm
intention to make the offer addressed by Blue to Credit U`s board dated 17
September 2008.
2. THE OFFER
The amendments to the scheme and substitute offer will be printed in bold
italics in this updated announcement in the press.
2.1 The scheme:
2.1.1 Blue will propose a scheme of arrangement between Credit U and
the Credit U ordinary shareholders ("scheme members"), in terms
of section 311 of the Companies Act, for the purpose of acquiring
the entire issued share capital of Credit U excluding the
2 250 000 treasury shares held by the Employee Share Incentive
Scheme ("the Scheme"), by the issue of 44.5 Blue shares for every
100 Credit U shares held ("the scheme consideration").
2.1.2 The scheme consideration will entail that 51 508 750 Blue
ordinary shares will be issued by Blue at an issue price of 540
cents per share. The total purchase consideration will therefore
amount to a total value of R278 147 250.
2.1.3 22.25 of the Blue ordinary shares receivable by every scheme
member for every 100 Credit U ordinary shares held will be 50%
pre-placed with Mr Dave van Niekerk (a shareholder and executive
director of Blue) and 50% with Riaan Swart (a shareholder and
former executive director of Blue) for a cash consideration of
540 cents per Blue ordinary share amounting to R139.07 million as
partial settlement in cash of the scheme consideration. Mr Dave
van Niekerk and Mr Riaan Swart (collectively "the first
underwriters") have each in their individual capacity provided
confirmation to the satisfaction of the Securities Regulation
Panel ("SRP") that they have sufficient cash resources to meet
their respective partial cash settlement obligations.
2.1.4 As far as the remaining 22.25 Blue ordinary shares are concerned
which will be receivable by scheme members for every 100 Credit U
ordinary shares held:
- the holders of 80,2% of scheme shares have:
- irrevocably undertaken not to sell these shares for a period
of 6 months after the effective date of the scheme;
- granted Mr Dave van Niekerk a right of first refusal in
respect of a proposed sale of these shares at any time and
in respect of every sale opportunity during the period
commencing on the first day of the seventh month after the
effective date of the scheme, and ending on the last day of
the twelfth month after the effective date of the scheme,
whereby Mr Dave van Niekerk will have 5 working days to
accept the purchase of these shares; and
- undertaken to elect the cash alternative of 540 cents per
Blue ordinary share in respect of 15.575 Blue ordinary
shares of their remaining holdings of 22.25 Blue ordinary
shares for every 100 Credit U ordinary shares held with
Pictet & Cie Banquiers Geneva, Halbis Capital Management
(UK) Limited, Synerstat (Pty) Limited, Mr Eric Dalton and
the first underwriters (collectively "the second
underwriters");
- The second underwriters are prepared to acquire 15.575 Blue
ordinary shares of the remaining Blue ordinary shares at 540
cents per share. The second underwriters have provided cash
confirmation in respect of R97 351 537.50 to the satisfaction of
the SRP. As envisaged in the Firm Offer, the proposed scheme has
therefore been amended in the following respects:
- The second underwriters are collectively Pictet & Cie
Banquiers Geneva, Halbis Capital Management (UK) Limited,
Synerstat (Pty) Limited, Eric Dalton and the first
underwriters;
- The second underwriters have provided confirmation to the
satisfaction of the SRP that they have sufficient cash
resources to meet their obligations of R97 351 537.50 in the
following proportions:
Underwriter Amount
Dave van Niekerk R30 491 008
Riaan Swart R30 463 191
Pictet & Cie Banquiers Geneva R21 600 000
Halbis Capital Management (UK) R13 197 600
Limited
Synerstat (Pty) Limited R799 740
Eric Dalton R799 999
- In terms of the scheme, scheme members (with the exception
of those referred to below) will be entitled to elect to
place 15.575 of the remaining Blue ordinary shares
receivable by them with the second underwriters at 540 cents
per Blue ordinary share on the effective date of the scheme;
- The holders of 80.2% of scheme shares have irrevocably
undertaken to elect the cash alternative of 540 cents per
Blue share referred to above in respect of 15.575 Blue
ordinary shares of their remaining holdings of 22.25 Blue
ordinary shares for every 100 Credit U ordinary shares held;
- In terms of an agreement between the first underwriters, and
to the extent that the holders of 19.8% of scheme shares
elect not to place 15.575 of the remaining Blue ordinary
shares receivable by them with the second underwriters, Mr
Dave van Niekerk has undertaken to sell to Mr Riaan Swart,
such number of Blue ordinary shares placed with him in terms
of the scheme, so as to ensure that the total value of Blue
ordinary shares placed with Mr Riaan Swart (in his capacity
as either co-first underwriter or co-second underwriter) in
aggregate totals R100 million.
2.1.5 The incumbent trustees of the Trust set up for purposes of the
Employees Share Incentive Scheme holding the 2 250 000 Credit U
treasury shares as referred to above will be replaced by trustees
to be appointed by Blue once all the suspensive conditions have
been fulfilled.
2.1.6 Upon implementation of the scheme, Credit U will become a wholly-
owned subsidiary of Blue and its listing on the Alternative
Exchange of the JSE will be terminated.
2.1.7 The scheme remains subject to the same conditions precedent as
before, as set out in paragraph 3.2 of the original announcement.
2.2 The substitute offer:
2.2.1 In the event that the Scheme fails or does not become operative,
Blue will make a conditional offer to Credit U ordinary
shareholders to acquire all their ordinary shares (excluding the
2 250 000 treasury shares held by the Employee Share Incentive
Scheme) by the issue of 44.5 Blue ordinary shares for every 100
Credit U ordinary shares held ("offer consideration") in terms of
section 440 of the Companies Act which will be conditional on
acceptance by shareholders of Credit U holding no less than 90%
of the total issued ordinary shares of Credit U, and be on such
terms that Blue will invoke the provisions of section 440K of the
Companies Act to acquire the shares of the remaining
shareholders, if the offer is accepted by the holders of no less
than 90% of the issued ordinary shares of Credit U ("the
substitute offer").
2.2.2 The offer consideration will entail that 51 508 750 Blue ordinary
shares will be issued by Blue at an issue price of 540 cents per
share. The total purchase consideration will therefore amount to
a total value of R278 147 250.
2.2.3 22.25 of the Blue ordinary shares receivable by every Credit U
shareholder for every 100 Credit U ordinary shares held will be
pre-placed with the first underwriters for a cash consideration
of 540 cents per Blue share amounting to R139 073 625 as partial
settlement in cash of the offer consideration. The first
underwriters have provided confirmation to the satisfaction of
the SRP that they each in their individual capacity have
sufficient cash resources to meet their respective partial cash
settlement obligations.
2.2.4 As far as the remaining 22.25 Blue ordinary shares are concerned
which will be receivable by Credit U ordinary shareholders for
every 100 Credit U ordinary shares held:
- the holders of 78.6% of the issued shares of Credit U have:
- irrevocably undertaken not to sell these shares for a period of 6
months after the effective date of the substitute offer;
- granted Mr Dave van Niekerk a right of first refusal in respect
of a proposed sale of these shares at any time and in respect of
every sale opportunity during the period commencing on the first
day of the seventh month after the effective date of the
substitute offer, and ending on the last day of the twelfth month
after the effective date of the substitute offer, whereby Mr Dave
van Niekerk will have 5 working days to accept the purchase of
these shares; and
- undertaken to elect the cash alternative of 540 cents per Blue
ordinary share in respect of 15.575 Blue ordinary shares of their
remaining holdings of 22.25 Blue ordinary shares for every 100
Credit U ordinary shares held with the second underwriters;
- The second underwriters are prepared to acquire 15.575 Blue ordinary
shares of the remaining Blue ordinary shares at 540 cents per share.
The second underwriters have provided cash confirmation in respect of
R97 351 537.50 to the satisfaction of the SRP. As envisaged in the
Firm Offer, the substitute offer has therefore been amended in the
following respects:
- The second underwriters are Pictet & Cie Banquiers Geneva, Halbis
Capital Management (UK) Limited, Synerstat (Pty) Limited, Eric
Dalton and the first underwriters;
- The second underwriters have provided confirmation to the
satisfaction of the SRP that they have sufficient cash resources
to meet their obligations of R97 351 537.50, in the following
proportions:
Underwriter Amount
Dave van Niekerk R30 490 008
Riaan Swart R30 463 191
Pictet & Cie Banquiers Geneva R21 600 000
Halbis Capital Management (UK) R13 197 600
Limited
Synerstat (Pty) Limited R799 740
Eric Dalton R799 999
- In terms of the substitute offer, Credit U shareholders (with the
exception of those referred to below) will be entitled to elect
to place 70% (i.e. 15.575) of their remaining Blue ordinary
shares receivable by them with the second underwriters at 540
cents per Blue ordinary share on the effective date of the
substitute offer;
- the holders of 78.6% of the issued ordinary shares of Credit U
have irrevocably undertaken to elect the cash alternative of 540
cents per Blue share referred to above in respect of 15.575 Blue
ordinary shares of their remaining holdings of 22.25 Blue
ordinary shares for every 100 Credit U ordinary shares held.
2.2.5 The incumbent trustees of the Trust set up for purposes of the
Employees Share Incentive Scheme holding the 2 250 000 Credit U
treasury shares as referred to above will be replaced by trustees
to be appointed by Blue once all the suspensive conditions have
been fulfilled.
2.2.6 If the scheme becomes operative, the substitute offer will not be
implemented.
2.2.7 The substitute offer remains subject to the same conditions
precedent as before, as set out in paragraph 3.3 of the original
announcement.
2. DOCUMENTATION AND SALIENT DATES
Further details of the scheme and the substitute offer will be included in
a circular to Credit U ordinary shareholders, which will, subject to the
approval of the JSE and the SRP, be dispatched to Credit U ordinary
shareholders in due course.
Salient dates in relation to the scheme will be published prior to the
issuing of the abovementioned documentation.
Johannesburg
17 September 2008
Designated Adviser and Designated Adviser and
corporate Adviser to Credit U Corporate Adviser to BLUE
EXCHANGE SPONSORS PSG CAPITAL
Attorneys to Credit U
EDELSTEIN BOSMAN
Date: 17/09/2008 15:00:03 Produced by the JSE SENS Department.
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