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REI - Reinet Investments S.C.A. - Abridged pre-listing statement for
Reinet Investments SCA
Richemont Securities AG
(Incorporated in Switzerland)
Reinet Investments S.C.A. Depositary Receipt code: REI
Reinet Investments S.C.A. ISIN: CH0045159214
ABRIDGED PRE-LISTING STATEMENT FOR REINET INVESTMENTS SCA
This abridged pre-listing statement relates to the listing of depositary
receipts ("Reinet DRs") in respect of ordinary shares ("Reinet Shares")
in the issued share capital of Reinet Investments SCA ("Reinet
Investments"), a societe en commandite par actions (partnership limited
by shares) incorporated under the laws of Luxembourg (having the objects
and tax status of a securitisation company) on the JSE Limited ("JSE")
with effect from Tuesday 21 October 2008.
This abridged pre-listing statement is not an invitation to the public
to subscribe for Reinet Shares or Reinet DRs, but is issued in
compliance with the Listings Requirements of the JSE for the purpose of
providing information to the public with regard to Reinet Investments.
Holders of depositary receipts in respect of Richemont `A` units
("Richemont DRs") are referred to the Richemont Information Memorandum
and Supplementary Information Memorandum regarding the proposed
restructuring of Richemont and the distribution of ordinary shares in
British American Tobacco plc ("BAT") ("BAT Shares") posted to holders of
Richemont DRs on 15 August 2008 and the related announcements released
by Richemont Securities AG ("Depositary") on SENS and published in the
press on 8 August 2008 ("Restructuring Documents"). Copies of these
documents and announcements may (subject to certain restrictions) be
downloaded from the Richemont website (www.richemont.com).
1. Introduction
Richemont `A` units ("`A` Units") are currently listed on SIX Swiss
Exchange (formerly SWX Swiss Exchange) and traded on SWX Europe
Limited. Each `A` Unit comprises one `A` ordinary share in
Compagnie Financiere Richemont SA, Geneva ("CFR") ("CFR Share")
indivisibly twinned with one participation certificate issued by
Richemont SA, Luxembourg ("RSA") ("PC"). Richemont DRs, each
representing a one-tenth indivisible share of an underlying `A`
Unit, are listed and traded on the JSE.
The restructuring ("Restructuring") involves the detwinning of the
CFR Shares and the RSA PCs; the separation of the luxury business
from the other assets held by Richemont; the conversion of RSA into
an investment vehicle to be known as Reinet Investments; the
conversion of the PCs into Reinet Shares and the separate listing
of Reinet Shares on the Luxembourg Stock Exchange. CFR Shares will
continue to be listed on SIX Swiss Exchange and traded on SWX
Europe Limited. In a subsequent step, Reinet Investments will
distribute 90 per cent of its interest in BAT to its shareholders
and depositary receipt holders ("Reinet Reduction of Capital");
will issue Reinet DRs to Remgro Limited ("Remgro") shareholders in
exchange for the contribution of 10 per cent of Remgro`s interest
in BAT; and will offer its shareholders and depositary receipt
holders the opportunity to participate in a rights issue ("Rights
Offering") by contributing BAT Shares to Reinet Investments in
exchange for the issue and allotment of new Reinet Shares or Reinet
DRs, as the case may be.
All shareholder and unitholder approvals for the Restructuring have
now been obtained and all formal regulatory approvals in order to
implement the Restructuring are expected to be obtained by the
times indicated in the Restructuring Documents.
As a result, the Richemont DRs will be split to reflect the change
in the underlying security and depositary receipts in respect of
CFR shares ("CFR DRs") and Reinet DRs will be listed on the JSE.
Richemont DR holders will receive one Reinet DR and one CFR DR for
every Richemont DR held on the record date on the JSE for the
Restructuring, being Monday 27 October 2008. The existing
Richemont DRs will be suspended from trading from the commencement
of business on Tuesday 21 October 2008 and will be delisted from
the JSE on Tuesday 28 October 2008.
2. Listing particulars
On initial implementation of the Restructuring:
- 5 220 000 000 CFR DRs of no par value will be listed on the JSE
under the short name "CFR". The CFR DRs will trade under the share code
"CFR" and the ISIN number CH0045159024 from 09:00 (South African
Standard Time ("SAST")) on Tuesday 21 October 2008; and
- 5 742 000 000 Reinet DRs of no par value will be listed on the JSE
under the short name "Reinet". The Reinet DRs will trade under the
share code "REI" and the ISIN number CH0045159214 from 12:00 (SAST) on
Tuesday 21 October 2008.
The delivery of the Reinet Shares to former `A` Unitholders on the
morning of 21 October 2008 involves interaction between several
independent clearing and settlement systems and there are various
steps involved in the crediting and reconciliation of various
accounts. Accordingly, whilst the listing of Reinet Shares on the
Luxembourg Stock Exchange and the Reinet DRs on the JSE will take
effect from 09:00 (SAST), trading the the Reinet Shares and the
Reinet DRs will commence at 12:00 noon (SAST) on 21 October 2008.
2.1 Distribution of shares in BAT
Reinet Investments will return 90% of its shares in BAT, being
some 351 million shares representing c. 17.6 per cent of the
ordinary capital of BAT, to its shareholders (and consequently
the Reinet DR holders) on the cancellation of approximately
86.3 per cent of their interest in Reinet Investments. Reinet
Investments shareholders will receive 0.7083 BAT Shares for
every Reinet Share cancelled. Accordingly, Reinet DR holders
will receive 0.7083 BAT Shares for every 10 Reinet DRs
cancelled.
From the close of business on Monday 27 October 2008, the last
day to trade in Reinet DRs in order to participate in the
Reinet Reduction of Capital, Reinet DR holders will have
approximately 86.3 per cent of their holding of Reinet DRs
blocked in anticipation of their cancellation pursuant to the
Reinet Reduction of Capital and will therefore not be able to
trade in such blocked Reinet DRs after 27 October 2008. The
remaining c. 13.7 per cent of their Reinet DR holding will
commence trading under a new ISIN number, CH0045793657, and
will trade under that new ISIN number from the commencement of
business on Tuesday 28 October 2008.
The Reinet DRs to be cancelled will be suspended from trading
on the morning of Tuesday 28 October 2008 under the ISIN
number CH0045159214 and will be delisted from the commencement
of business on Tuesday 4 November 2008.
BAT has undertaken to apply to the JSE for a secondary listing
of its shares. It is anticipated that the BAT Shares which
will be distributed to a Reinet DR holder pursuant to the
Reinet Reduction of Capital will be listed and commence
trading on the JSE from the commencement of business on
Tuesday 28 October 2008.
2.2 Distribution of Reinet DRs to shareholders of Remgro
Remgro will contribute 21 430 000 BAT Shares to Reinet
Investments in consideration for which Reinet Investments will
issue 30 255 541 new Reinet Shares to the Depositary ("First
Capital Increase") which in turn will issue 302 555 410 new
Reinet DRs to Remgro shareholders.
Following the Reinet Reduction of Capital and the First
Capital Increase, 108 856 270 Reinet Shares will be in issue;
accordingly the number of Reinet DRs listed on the JSE will
then be 1 088 562 700.
2.3 Rights Offering by Reinet
Reinet Investments` will launch a Rights Offering in terms of
which Reinet Investments shareholders will be provided with
the opportunity to subscribe for additional Reinet Shares
("New Reinet Shares") by contributing BAT Shares to Reinet
Investments or its subsidiary. On or about Monday 10 November
2008, Reinet Investments will issue nil paid warrants
("Warrants") to its shareholders with one Warrant issued for
every Reinet Share outstanding. It is expected that Reinet
Investments shareholders will be able to subscribe for four
New Reinet Shares for every five Reinet Shares held.
A derivative of the warrants ("Warrant Receipts") will be
listed on the JSE and will enable Reinet DR Holders to
participate in the Rights Offering and subscribe for
additional Reinet DRs ("New Reinet DRs") by contributing BAT
Shares to Reinet Investments or its subsidiary. The Warrant
Receipts will be issued by the Depositary with one Warrant
Receipt issued for every ten Reinet DRs held. It is expected
that Reinet DR Holders will be able to subscribe for forty New
Reinet DRs for every fifty Reinet DRs held. The Warrant
Receipts will be traded on the JSE and a facility will be
established to facilitate the trading of the Warrants and
Warrant Receipts between the Luxembourg and South African
markets.
The precise terms of the Rights Offering, including its size
and the subscription exchange ratio, will be determined
immediately prior to its launch. The subscription exchange
ratio will be determined with reference to the prevailing
market prices of BAT Shares and Reinet Shares and is expected
to reflect a 5-10 per cent discount to the theoretical ex-
rights price ("TERP") of Reinet Shares which itself is
expected to reflect a discount to the net asset value per
share of Reinet Investments. This subscription exchange ratio
will be announced immediately prior to the issue of the
Warrants.
Rupert family interests have committed to underwrite the
entire Rights Offering and, through a subsequent placing (at
the option of Rupert family interests) of Reinet Shares at pro
forma NAV per share, will be able to contribute into Reinet
any remaining BAT Shares that they hold following the Rights
Offering.
3. Overview and structure of Reinet
Reinet Investments will be a securitisation vehicle incorporated in
Luxembourg; its ordinary shares will be listed on the Luxembourg
Stock Exchange. Depositary Receipts in respect of such ordinary
shares will be listed on the JSE.
Reinet Investments` investment policy will be to invest into its
sole subsidiary, Reinet Fund SCA FIS ("Reinet Fund"), a societe en
commandite par actions (partnership limited by shares) incorporated
under the laws of Luxembourg, having the objects and tax status of
a specialised investment fund.
Reinet Fund will directly or indirectly hold all of the underlying
investments. Reinet Investments and Reinet Fund will be managed by
their managing partners (actionnaires commandites), Reinet
Investments Manager SA ("Reinet Investments Manager") and Reinet
Fund Manager SA ("Reinet Fund Manager") respectively. Reinet
Investments Manager and Reinet Fund Manager will be limited
liability companies incorporated in Luxembourg and controlled by
Rupert family interests. Both managing partners will be chaired by
Mr Johann Rupert, who will also remain as Executive Chairman of
CFR.
(Please refer to press for structure of Reinet)
3.1 Initial portfolio
The portfolio of investments will include, immediately
following the Reinet Reduction of Capital and the First
Capital Increase, approximately 60 million BAT Shares; Euro
351 million in cash; and other assets, which include
relatively small unlisted investments in technology and
related sectors, which were valued as at 31 May 2008 at Euro55
million.
Any dividends declared from income generated from the listed
and unlisted investments held by Reinet Fund may be paid to
Reinet Investments and Reinet Investments will remit such
dividends to its shareholders (and consequently to the Reinet
DR holders via Richemont Securities) after deduction of its
own operating expenses. Under current law and practice,
dividends will be paid free of withholding taxes by Reinet
Investments to its shareholders and the Reinet DR holders.
3.2 Investment objective and policy of Reinet Fund
The investment objective of Reinet Fund will be to achieve
long-term capital growth.
Reinet Fund`s assets may be invested from time to time,
directly or through selected third-party managers, in equity
securities, fixed income securities, convertible securities
and related investments as well as money market investments.
Reinet Fund may invest in commercial and residential property,
land and other forms of real estate investments.
Reinet Fund may also use derivative instruments including
futures and/or forward contracts on any security, commodity,
interest rate, currency, stock or indices or on any precious
metals, contracts for differences, including index contracts,
swaps and all ancillary transactions to any of the above,
including margined and/or collateralised transactions to any
of the above and off-exchange contracts.
It is not currently expected that Reinet Fund will make
systematic use of indebtedness on any significant scale but it
may from time to time borrow to finance specific investments.
It is expected that any investments in luxury goods businesses
will be made through CFR.
4. Management and corporate governance
4.1 Reinet Investments Manager
Reinet Investments will be managed by Reinet Investments
Manager, which will be the holder of 1 000 management shares
in Reinet Investments. Reinet Investments Manager will have
broad powers to carry out all management and administrative
functions in compliance with the corporate objects of Reinet
Investments.
The board of directors of Reinet Investments Manager will be
responsible for the management of Reinet Investments and will
be required to act in the company`s best interests. The board
of directors of Reinet Investments Manager will initially
comprise:
Name Nationality and Position
Age
Johann P Rupert South African, 58 Chairman
Jo` Schwenke South African, 57 Chief Executive
Officer
Alan Grieve British, 56 Chief Financial
Officer
Eloy Michotte Belgian, 60 Member
The address of each director above is c/o Reinet Investments
Manager SA, 35, Boulevard Prince Henri, L-1724 Luxembourg.
4.2 Reinet Fund Manager
Reinet Fund will be managed by Reinet Fund Manager, which will
be the holder of 1 000 management shares in Reinet Fund.
Reinet Fund Manager will have broad powers to carry out all
management and administrative functions in compliance with the
corporate objects of Reinet Fund. In particular, Reinet Fund
Manager will be responsible for determining the investment
policies and restrictions of Reinet Fund in order to meet
Reinet Fund`s investment objectives and for the conduct of
Reinet Fund`s management and business affairs.
The board of directors of Reinet Fund Manager will be
responsible for the management of Reinet Fund and will be
required to act in the best interests of Reinet Fund. The
board of directors will initially comprise:
Name Nationality and Position
Age
Johann P South African, 58 Chairman
Rupert
Jo` Schwenke South African, 57 Chief Executive
Officer
Alan Grieve British, 56 Chief Financial
Officer
Kurt Nauer Swiss, 58 Chief Investment
Officer
Eloy Michotte Belgian, 60 Member
The address of each person named above is c/o Reinet Fund
Manager SA, 35 Boulevard Prince Henri, L-1724 Luxembourg.
4.3 Investment Advisor
Reinet Fund Manager has entered into an investment advisory
agreement ("Investment Advisory Agreement") with Reinet
Investment Advisors Limited ("Investment Advisor") under which
the Investment Advisor will make investment proposals to
Reinet Fund Manager and implement the investment decisions
adopted by Reinet Fund Manager on behalf of Reinet Fund. The
Investment Advisor will establish a team of experienced
investment managers with strong investment records and
focusing on long term capital growth.
The Investment Advisor will also assist Reinet Fund Manager in
managing the assets and day-to-day operations of Reinet Fund.
The board of directors of the Investment Advisor will
initially comprise:
Name Nationality and Position
age
Johann P Rupert South African, 58 Chairman
Jason Eaglestone Portuguese/ South Chief Financial
African, 34 Officer
Frank Vivier South African, 51 Chief Investment
Officer
Ian Crosby British, 47 Member
Niall McCallum British, 46 Member
4.4 Expenses and administration fees
The expenses of Reinet Investments Manager and Reinet Fund
Manager incurred in the ordinary course of business will be
reimbursed by Reinet Investments and Reinet Fund respectively.
In addition, Reinet Investments will pay Reinet Investments
Manager an annual fee equal to ten per cent of such expenses
of Reinet Investments Manager.
The Investment Advisor will be paid a management fee
calculated as 1 per cent of the NAV of Reinet Fund adjusted
for corporate net indebtedness of Reinet Investments in
respect of investments other than (i) cash, which will attract
a fee of 0.25 per cent, and (ii) third-party managed assets,
on which no management fee will be payable. No management fee
will be charged for the period until 31 March 2009. The
management fees will be reduced by the amount of any
reimbursements of expenses paid or payable by Reinet Fund to
Reinet Fund Manager.
In addition, the Investment Advisor will be entitled to
receive a performance fee from Reinet Fund equal to 10 per
cent of the cumulative total shareholder return from the date
of formation of Reinet Investments, where the cumulative total
shareholder return will comprise share price appreciation
adjusted to add back distributions made to shareholders. The
first measurement date in respect of the performance fee will
be 31 March 2011.
4.5 Board of Overseers
The operations of Reinet Investments and Reinet Fund will be
subject to review and audit by a board of overseers (college
des commisaires) ("Board of Overseers") appointed by their
respective shareholders. Reinet Investments Manager will
procure that the same persons are elected as the members of
the Board of Overseers of Reinet Fund as those elected to the
Board of Overseers of Reinet Investments. The Board of
Overseers will initially comprise:
Name Nationality and age
Yves-Andre American, 72
Istel
Ruggero Magnoni Italian, 57
Alan Quasha American, 58
Jurgen Schrempp German, 63
Reinet Investments Manager and Reinet Fund Manager must
consult the Board of Overseers in respect of matters which
exceed their respective powers in accordance with the statutes
of each entity and Luxembourg law. The Board of Overseers may
also resolve to require Reinet Fund Manager to terminate the
Investment Advisory Agreement in certain circumstances.
5. Timetable
The following timetable is expected to apply to the listing of
Reinet DRs, the Reinet Reduction of Capital and the Rights
Offering.
2008
Last date to dematerialise or Friday 10 October
rematerialise Richemont DRs
Conversion of `A` Units into Richemont Monday 13 October
DRs and Richemont DRs into Richemont
units blocked from
Last day to trade in Richemont DRs on the Monday 20 October
JSE
Suspension of the Richemont DRs from Tuesday 21 October
trading on the JSE from 09:00 ("SAST")
Listing of CFR DRs and Reinet DRs on the Tuesday 21 October
JSE at 09:00 (SAST) on
Commencement of trade in the CFR DRs on Tuesday 21 October
the JSE from 09:00 (SAST)
Commencement of trade in the Reinet DRs Tuesday 21 October
on the JSE from 12:00 (SAST)
Finalisation date for the capital Friday 24 October
reduction of Reinet
Record date for the Restructuring Monday 27 October
Last day to trade Reinet DRs "cum- Monday 27 October
entitlement" to the distribution of BAT
Shares
Conversion of Reinet Shares into Reinet Tuesday 28 October to
DRs and Reinet DRs into Reinet Shares Monday 3 November
blocked from (inclusive)
Delisting of Richemont DRs from the JSE Tuesday 28 October
on
Dematerialised Richemont DR holders` Tuesday 28 October
accounts with their brokers or CSDPs will
be updated with the CFR DRs and the
Reinet DRs on
Certificates in respect of the CFR DRs Tuesday 28 October
posted to certificated Richemont DR
holders on or about (note 2)
First day to trade Reinet DRs "ex- Tuesday 28 October
entitlement" to the distribution of BAT
Shares from 09:00 (SAST)
Listing of BAT Shares on the JSE Tuesday 28 October
effective on or before
First day to trade BAT Share entitlements Tuesday 28 October
from 09:00 (SAST)
Record date on the JSE for the Reinet Monday 3 November
Reduction of Capital
Dematerialised Reinet DR holders` Tuesday 4 November
accounts with their broker or CSDP will
be updated with BAT Shares on or about
(note 3)
Conversion of Reinet Shares into Reinet Thursday 6 November and
DRs and Reinet DRs into Reinet Shares Friday 7 November
blocked on
Publication of the Rights Offering Friday 7 November
prospectus on or about
Last day to trade in Reinet DRs on the Friday 7 November
JSE to be eligible for the Rights
Offering
First day of the Warrant Receipts Monday 10 November
exercise period
Warrant Receipts listed and commence Monday 10 November
trading on the JSE from 09:00 (SAST)
Record date on the JSE to be eligible for Friday 14 November
the Rights Offering
Conversion of Warrants into Warrant Thursday 27 November
Receipts and Warrant Receipts into
Warrants blocked from
Last day to trade in Warrant Receipts on Friday 28 November
the JSE
Last practicable day for the exercise of Wednesday 3 December
Warrant Receipts by dematerialised
Warrant Receipt holders (see note 4)
Last day for the exercise of Warrant Friday 5 December
Receipts by certificated Warrant Receipt
holders by 11:00 (SAST)
Record date on the JSE for the Rights Friday 5 December
Offering and closing of the Rights
Offering on the JSE
Auction of unexercised Warrants on the Monday 8 December
Luxembourg Stock Exchange
Dematerialised Reinet DR holders` Wednesday 10 December
accounts with their broker or CSDP
updated with New Reinet DRs on or about
Certificates in respect of the Reinet Wednesday 10 December
DRs, New Reinet DRs (to the extent
applicable) and BAT Shares will be posted
to those certificated former Richemont DR
holders who have surrendered their
Richemont DR certificates to the
depositary agent
Notes
1. Following the last day to trade in Reinet DRs in order to
participate in the capital reduction of Reinet, expected to be on Monday
27 October 2008, approximately 86.3 per cent of each Reinet DR holder`s
holding in Reinet DRs will be blocked in anticipation of the capital
reduction. Reinet DR holders should not sell more than their post
capital reduction entitlements to Reinet DRs which will be equal to
approximately 13.7% of their pre-capital reduction holdings.
2. Computershare Investor Services (Proprietary) Limited, the South
African transfer secretaries ("Transfer Secretaries") will withhold the
certificates in respect of Reinet DRs to which a certificated Richemont
DR holder is entitled upon the surrender of his Richemont DR
certificates to facilitate the Reinet Reduction of Capital.
3. The Transfer Secretaries will withhold the certificates in respect
of BAT Shares to which a certificated Reinet DR holder is entitled to
facilitate the Rights Offering proposed by Reinet;
4. Dematerialised Warrant Receipt holders are advised that in terms of
standard market practice, dematerialised Warrant Receipt holders must
instruct their CSDP or broker to exercise their Warrant Receipts by the
cut-off time requested by their CSDP or broker in accordance with the
custody agreement entered into between them. Certificated Warrant
Receipt holders may exercise their Warrant Receipts in accordance with
its terms by 11:00 (SAST) on Friday 5 December 2008.
5. These dates and times are subject to change. Any material change
will be released on SENS.
6. Although the clearing and settlement systems have agreed to certain
procedures to facilitate the settlement and the trading of the relevant
securities among their participants, they are under no obligation to
perform or to continue to perform these procedures, and these procedures
may be discontinued at any time. None of CFR, Reinet or any of their
respective affiliates or agents will have any responsibility for the
performance by the clearing and settlement systems or their respective
participants of their obligations under the rules and procedures
governing their operations.
6. Copies of the Reinet pre-listing statement
Copies of the Reinet Investments prospectus and the supplementary
pre-listing information document regarding the listing of Reinet
DRs (in English only) ("the Reinet Investments` Documents") can be
obtained during normal business hours from the offices of:
Computershare Investor Services (Proprietary) Limited
Ground Floor
70 Marshall Street
Johannesburg, 2001, South Africa
Rand Merchant Bank, a division of FirstRand Bank Limited
1 Merchant Place
Corner Rivonia Road and Fredman Drive
Sandton
In addition, interested parties may call 0861 100 925 to request
that a copy of the Reinet Investments, Documents be mailed to them.
Geneva
14 October 2008
Merchant bank and sponsor
RAND MERCHANT BANK (A division of FirstRand Bank Limited)
Financial adviser
Goldman Sachs International
Attorneys
Cliffe Dekker Hofmeyr Incorporated
Date: 15/10/2008 08:48:01 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.
