| Mon 27 Oct 2008, 17:07 | | VTL - Ventel - The Disposal Of A Subsidiary Offer To Purchase All Of The Ventel |
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VTL
VTL
VTL - Ventel - The Disposal Of A Subsidiary Offer To Purchase All Of The Ventel
Shares In Issue Other Than Those Already Held Or Controlled By The Major
Shareholder Of Ventel Voluntary Termination Of The Listing Of Ventel On The JSE
Limited ("the JSE")
VENTER LEISURE AND COMMERCIAL TRAILERS LIMITED
(INCORPORATED IN THE REPUBLIC OF SOUTH AFRICA)
(REGISTRATION NUMBER: 1985/070343/06)
SHARE CODE: VTL & ISIN: ZAE000007811
("Ventel" or "the Company")
THE DISPOSAL OF A SUBSIDIARY
OFFER TO PURCHASE ALL OF THE VENTEL SHARES IN ISSUE OTHER THAN THOSE ALREADY
HELD OR CONTROLLED BY THE MAJOR SHAREHOLDER OF VENTEL
VOLUNTARY TERMINATION OF THE LISTING OF VENTEL ON THE JSE LIMITED ("the JSE")
1. Introduction
Shareholders are advised that an agreement has been reached between the Board of
Ventel and Al-Ko Trailco (Proprietary) Limited ("the purchaser") for the
disposal of the business of Rubax (Proprietary) Limited ("Rubax"), as a going
concern for a purchase consideration of R6 million plus an amount equal to the
value of stock as determined in terms of the provisions of the agreement ("the
disposal").
The effective date of the disposal will be the second business day after the
date on which all conditions precedent are fulfilled.
The consideration of R6 million, will be settled in cash. The proceeds of the
disposal will be utilised by the Company to reduce liability in respect of the
outstanding long term shareholder loans.
2. Description of the Rubax business and rationale for the disposal
Rubax (a wholly owned subsidiary of Ventel) conducts a business comprising the
manufacture and sale of axles used for leisure and light commercial trailers.
The purchaser is a local subsidiary of the Kober Group based in Germany, and is
a manufacturer of axels, trailer components and chassis for car manufacturers.
The rational for the disposal is that Ventel wishes to focus on the manufacture
and distribution of trailers only and that the price offered is favourable in
relation to the contribution made by Rubax to Ventel`s earnings.
3. Firm intention to purchase the outstanding shares and the Delisting of the
Company
Dunrose Investments 143 (Pty) Ltd, the controlling shareholder of Ventel (80%),
has submitted to the board of directors of Ventel ("the board") a letter
confirming its firm intention, subject to the fulfilment of the conditions
precedent set out in paragraph 8 below, to purchase all of the shares in issue,
other than the ordinary shares currently held by it and its associates, ("the
offer shares") for a cash consideration of 30 cents per share ("the offer") and
to subsequently terminate the listing of the company on the JSE ("the
delisting") in terms of the Securities Regulation Code on Takeovers and Mergers
("the Code").
Application will be made in due course for the delisting of the company from the
JSE, subject to approval of the requisite resolution by shareholders in general
meeting.
4. Rationale for the delisting and the offer
The scale of the business does not justify a listing and the Board feels that
the Company should de-list from the JSE in order to conserve its limited funds
to grow the business.
Furthermore, Ventel no longer complies with certain of the requirements of a JSE
Main Board listing, and the Board feels that it is unlikely that it will meet
all the JSE Listings Requirements in the foreseeable future.
5. The offer to ventel minority shareholders
In terms of the JSE Listing Requirements, an offer is required to be made to
shareholders for the delisting to be approved.
Confirmation has been provided to the satisfaction of the SRP that sufficient
resources are available to Dunrose to meet its commitments in terms of the
offer.
6. Financial effects
The pro forma financial effects of the disposal are set out below. The pro forma
financial effects have been prepared for illustrative purposes only to provide
information on how the disposal may have impacted on the results and financial
position of Ventel. Preparation of the pro forma financial effects is the
responsibility of the directors. Because of their nature, the pro forma
financial effects may not fairly present Ventel`s financial position after the
disposal or the effects on future earnings:
Before the After the
Disposal Disposal 2 After the Percentage
30 June delisting change
2008 offer
(unaudited
results)
Earnings per share 1.98 11.881 11.88 500
(cents)
Headline earnings 1.81 5.131 5.13 183
per share (cents)
Net asset value 37.663 37.66 31.86
(cents per share) 28.56
Net tangible asset 26.62 35.723 35.72 34.18
value (cents per
share)
Number of shares in 50,495,094 50,495,094 50,495,094 -
issue
Weighted average 50,495,094 -
number of 50,495,094 50,495,094
shares in issue
Notes and assumptions:
(1) Pro forma earnings and headline earnings are based on Ventel`s published
unaudited interim results of Ventel for the 6 months ended 30 June 2008
after taking into account the following adjustments:
- an average interest rate on borrowings of 9%;
- R750 000 transaction costs were included; and
- a company tax rate of 28%.
(2) The pro forma earnings figures illustrate the possible financial effects if
the disposal had been implemented on 1 January 2008.
(3) The net asset value and net tangible asset figures are based on the
assumption that the disposal happened on 30 June 2008.
7. Pro forma financial effects of the offer on the shareholder who accepts the
offer
Before After % change
acceptance acceptance
of the offer, of the offer if the offer
after the
disposal
(cents) (cents) is accepted
Market value per share 26 (1) 30 15
Market value per share 31 (2) 30 (3.2)
Net asset value ("NAV") 37.66 (3) 30 (20.33)
Net tangible asset value 35.72 (3) 30 (16)
("NTAV")
Earnings per share 11.88 (4) 1.35(4) (88.64)
Headline earnings per share 5.13 (4) 1.35(4) (73.68)
Notes:
(1) Based on the volume weighted average price of Ventel shares for the 60
trading days up to and including 29 July 2008, being the last trading day
before the cautionary announcement was published on SENS.
(2) Based on the closing price of Ventel shares on 29 July 2008, being the
trading day prior to the publication of the cautionary announcement on
SENS.
(3) Based on the NAV and NTAV of a Ventel share as at 30 June 2008.
(4) Based on earnings and headline earnings per share for the six months ended
30 June 2008 assuming an average interest rate on call accounts of 9.01%
and an after tax rate of 5.41%, on the proceeds of 30 cents per share.
8. Conditions precedent
The disposal is subject to conditions that are considered normal for
transactions of this nature.
The delisting is subject to shareholder approval of the disposal in general
meeting, the receipt of a fairness report by an independent advisor, and any
necessary regulatory approvals.
9. Categorisation and documentation for the disposal and delisting
The disposal is categorised as a Category 1 transaction in terms of the JSE
Limited`s Listings Requirements. A circular containing full details of the
disposal and delisting, including a notice of general meeting will be posted to
shareholders in due course.
10. Withdrawal of cautionary announcement
As a consequence of this announcement, shareholders are referred to the
cautionary announcements, the last of which was dated 9 September 2008 and are
advised that caution is no longer required to be exercised when dealing in the
Company`s securities.
Johannesburg
27 October 2008
Sponsor: Sasfin Capital
A division of Sasfin Bank Limited
Reporting Accountants:
Mazars Moores Rowland
Company Secretaries:
Probity Business Services Proprietary Limited
Date: 27/10/2008 17:07:01 Produced by the JSE SENS Department.
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