| Thu 30 Oct 2008, 14:19 | | CFR / REI - Compagnie Financiere Richemont SA / Re |
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CFR REI
CFR REI
CFR / REI - Compagnie Financiere Richemont SA / Reinet Investments S.C.A.
Depositary - Apportionment Of Share Values
Compagnie Financiere Richemont SA Reinet Investments S.C.A. Depositary
Depositary Receipts issued by Recepits issued by Richemont Securities
Richemont Securities AG AG (Incorporated in Switzerland)
(Incorporated in Switzerland) ISIN: CH0045793657
ISIN: CH0045159024 Depositary Receipt Code: REI
Depositary Receipt Code: CFR
APPORTIONMENT OF SHARE VALUES
On 20 October 2008 Compagnie Financiere Richemont SA (`CFR`) and Reinet
Investments SCA (`Reinet`) confirmed the de-twinning of Richemont `A` units into
CFR shares and Richemont SA participation certificates and the conversion of
Richemont SA into Reinet Investments SCA, pursuant to the terms of the Richemont
restructuring, details of which were set out in the Information Memorandum
published on 15 August 2008 and in the Reinet Prospectus dated 10 October 2008.
Set out below are indications of a basis of apportionment of the cost of a
Richemont `A` unit as between the CFR `A` share and the Reinet shares, which
were initially traded on 21 October 2008.
Holders of CFR `A` shares and Reinet shares
The tax treatment of individuals and corporate and other entities will vary from
jurisdiction to jurisdiction. Former Richemont unitholders are strongly advised
to consult their own professional advisors in respect of their taxation
position. Neither Richemont nor Reinet is in a position to provide taxation
advice to holders of the shares of the two companies.
For the purposes of determining the acquisition cost of a Reinet share and a CFR
`A` share in the relevant jurisdiction in which the former Richemont unitholder
is resident, the acquisition cost of an `A` Unit may have to be split by
reference to the historic values of an RSA PC and a CFR `A` share.
In this respect, the volume weighted average price (`VWAP`) of a Reinet share on
the Luxembourg Stock Exchange and a CFR `A` share on the SIX Swiss Exchange as
at close of trade on Tuesday, 21 October 2008 was Euro 12.87 per Reinet share
and CHF25.72 per CFR `A` share. Based on these VWAPs and the daily fix for the
Euro foreign exchange reference rate for the Swiss franc of 1.5224 as published
by the European Central Bank on 21 October 2008, the ratio of the respective
market values of the Reinet share and the CFR `A` share on Tuesday, 21 October
2008 was 43.2% relating to the Reinet shares and 56.8% relating to the CFR `A`
shares.
Holders of South African Depositary Receipts
Richemont `A` units were traded on the exchange operated by JSE Limited (`the
JSE`) in the form of Richemont Depositary Receipts (`DRs`) up to the close of
business on 20 October 2008. From 21 October 2008, CFR `A` shares and Reinet
shares have traded separately on the JSE in the form of CFR DRs and Reinet DRs,
respectively.
The supplementary information memorandum (`SIM`) published by Richemont
Securities AG and addressed to holders of Richemont DRs on 15 August 2008
regarding the restructuring of Richemont explained the basis on which South
African taxpayers should allocate the purchase cost of Richemont DRs (`Original
Expenditure`) as between CFR DRs and Reinet DRs. Richemont DR Holders must
attribute the expenditure allowable in terms of the provisions of the Eighth
Schedule to the Income Tax Act, 1962 in relation to each existing Richemont DR
between the newly issued CFR DR and the Reinet DR based on the market values of
CFR DRs and Reinet DRs as soon as they commence trading as separate instruments
on the JSE, which will be equal to the combined expenditure in respect of their
Reinet DRs and their CFR DRs.
In accordance with practice in South Africa, former Richemont DR Holders may
determine the allocation of the Original Expenditure between the new classes of
securities by calculating the VWAP of each of the new securities on the first
day of their trading. The method of allocation (`the Apportionment Ratio`),
however, remains at the discretion of each holder. The Apportionment Ratio is
to be used to apportion the Original Expenditure between the Reinet DRs and the
CFR DRs for the determination of profits and losses, of a capital or trading
nature. Where applicable the apportionment ratio is also to be used for capital
gains tax purposes to apportion the valuation date value as contemplated in the
Eighth Schedule to the Income Tax Act, 1962 between the Reinet DRs and the CFR
DRs.
The VWAP of the Reinet DR and the CFR DR as at close of trade on Tuesday, 21
October 2008 was R19.39 per Reinet DR and R23.04 per CFR DR. Accordingly, the
ratio of the respective market values of the Reinet DR and the CFR DR on the JSE
as at close of trade on Tuesday, 21 October 2008 was 45.7% relating to the
Reinet DR and 54.3% relating to the CFR DR.
In determining the base cost of the Reinet DRs and the CFR DRs for capital gains
tax purposes, Richemont DR Holders are deemed to have acquired both the Reinet
DRs and the CFR DRs on the dates on which the Richemont DRs were originally
acquired.
Should Richemont DR holders require further clarification of the tax treatment
and consequences of the apportionment of base cost, they should consult their
tax advisors. Neither Richemont nor Reinet is in a position to provide taxation
advice to holders of DRs.
Limitations of this announcement
This announcement is not intended for distribution to, or use by any person or
entity in any jurisdiction or country where such distribution or use would be
contrary to local law or regulations. This announcement does not constitute nor
does it form part of any offer or invitation to buy, sell, exchange or otherwise
dispose of, or issue, or any solicitation of any offer to sell or issue,
exchange or otherwise dispose of, buy or subscribe for, any securities, nor does
it constitute investment, legal, tax, accountancy or other advice or a
recommendation with respect to such securities, nor does it constitute the
solicitation of any vote or approval in any jurisdiction, nor shall there be any
offer or sale of securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or qualification
under the applicable securities laws of any such jurisdiction (or under
exemption from such requirements).
In particular, the information contained herein does not constitute an offer of
securities for sale in the United States. None of the securities described or
directly or indirectly referred to in this announcement have been and nor will
they be registered under the US Securities Act of 1933, as amended (the
"Securities Act"). Such securities may not be offered or sold in the United
States or to, or for the account or benefit of, US persons (as such terms are
defined in Regulation S under the Securities Act) unless registered under the
Securities Act or pursuant to an exemption from such registration. If and to
the extent that any such securities may be deemed to be offered or sold as a
result of the transactions described in this announcement, such securities are
being offered and sold only to persons in offshore transactions outside the
United States in accordance with Regulation S under the Securities Act. This
announcement has not been and may not be disseminated or distributed by any
person in the United States or to US persons.
Neither Reinet Investments SCA nor Reinet Fund SCA, FIS have been approved by
the Swiss Federal Banking Commission as a foreign collective investment scheme
pursuant to Article 120 of the Swiss Collective Investment Schemes Act of 23
June 2006.
Richemont owns a portfolio of leading international brands or `Maisons`, which
are managed independently of one another, recognising their individuality and
uniqueness. The businesses operate in five areas: Jewellery Maisons, being
Cartier and Van Cleef & Arpels; Specialist watchmakers, which is made up of
Jaeger-LeCoultre, Piaget, IWC, Baume & Mercier, Vacheron Constantin, Officine
Panerai, A. Lange & Sohne and Roger Dubuis; Writing instrument manufacturers -
Montblanc and Montegrappa; Leather and accessories Maisons, being Alfred Dunhill
and Lancel; and Other businesses, which includes, specifically, Chloe as well as
other, smaller Maisons and watch component manufacturing activities for third
parties.
Reinet Investments SCA acts as a securitisation vehicle allowing investors to
access Reinet Fund SCA, FIS, a specialised investment fund established in
Luxembourg. Reinet Fund SCA, FIS will invest with the objective of capital
growth over the long term. The initial assets of the fund include a significant
interest in British American Tobacco plc.
Compagnie Financiere Richemont SA Reinet Investments SCA
50 chemin de la Chenaie 35 boulevard Prince Henri
1293 Bellevue, Geneva L 1724 Luxembourg
Switzerland Luxembourg
30 OCTOBER 2008
Date: 30/10/2008 14:05:16 Produced by the JSE SENS Department.
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