| Wed 12 Nov 2008, 12:48 | | CAE - Cape Empowerment Trust - Realisation Of Investment In Ambit Properties |
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CAE
CAE
CAE - Cape Empowerment Trust - Realisation Of Investment In Ambit Properties
Limited And Withdrawal Of Cautionary Announcements
Cape Empowerment Trust Limited
(Incorporated in the Republic of South Africa)
(Registration number 1998/014606/06)
("CET", "the company" or "the group")
Share Code: CAE
ISIN: ZAE000016952
REALISATION OF INVESTMENT IN AMBIT PROPERTIES LIMITED AND WITHDRAWAL OF
CAUTIONARY ANNOUNCEMENTS
1. INTRODUCTION
1.1 Shareholders are referred to the cautionary announcement dated 9 October
2008 and are advised that CET has entered into an agreement with ApexHi
Properties Limited ("ApexHi") which will result in the realisation of
CET`s investment in its wholly-owned subsidiary, Business Venture
Investments 1232 (Proprietary) Limited ("BVI 1232")with effect from 12
November 2008 ("the effective date")("the transaction").
1.2 BVI 1232 is the special purpose vehicle that holds the group`s investment
of 110 000 000 linked units in Ambit Properties Limited ("Ambit")("the
Ambit linked units").
2. RATIONALE
2.1 The extreme volatility in local and world equity markets together with a
de-leveraging of these markets (and the resultant downward pricing of
equities) on a scale not seen in many years have created an environment
in which the board of directors of CET ("the board") believe that prudent
steps need to be taken to de-risk the company`s balance sheet.
2.2 After careful consideration the board has decided that the transaction is
the most appropriate way to achieve this de-risking and to significantly
strengthen the group`s balance sheet and cash position. Upon the
implementation of the transaction CET will be under geared and in an
excellent position to focus on growing its remaining property and
services businesses.
3. TERMS OF THE TRANSACTION
3.1 Details of BVI 1232
3.1.1 BVI 1232 acquired the Ambit linked units towards the end of 2007 as
a result of CET`s participation in the disposal of a portfolio of
properties by the African Alliance partnerships to Ambit.
3.1.2 As at the effective date BVI 1232 has no other assets and has the
following financial liabilities:
3.1.2.1 Third-party loans of approximately R343 million
3.1.2.2 A loan from CET of R94,14 million
3.2 Subject Matter, Purchase Price and Cash Flow
3.2.1 For purposes of the transaction, the Ambit linked units are valued
at 340 cents per unit, excluding the distribution of 19.2 cents per
unit payable on 1 December 2008, which will accrue to CET.
3.2.2 In terms of the transaction:
3.2.2.1 ApexHi has agreed to extend a loan to BVI 1232 to enable it to repay
its existing third party loans;
3.2.2.2 CET is disposing of 100% of the ordinary shares in the capital of
BVI 1232 to ApexHi at par, being R100; and
3.2.2.3 in addition, and upon the disposal of the shares in BVI 1232 to
ApexHi becoming unconditional, CET will receive a partial repayment
of its loan account estimated at R28 million, with the balance of
the loan being ceded to ApexHi.
3.3 Suspensive condition
The disposal of the shares in BVI 1232 is conditional upon any approvals
required in terms of the Competition Act.
4. PRO FORMA FINANCIAL EFFECTS
4.1 The unaudited pro forma financial effects of the transaction, based on
the published unaudited interim results of CET for the six months to 30
June 2008, are set out below. The preparation of these effects is the
responsibility of the directors of the company and it has been prepared
for illustrative purposes only to provide information on how the
transaction may have impacted on CET`s results and financial position.
Before After %Change
Loss per share (cents) 47,0 41,2 +12,4%
Headline loss per share
(cents) 46,5 40,7 +12,5%
Net asset value per share
(cents) 113,3 117,0 +3,3%
Tangible net asset value
Per share(cents) 99,5 103,3 +3,8%
Weighted number of shares
In issue (`000) 332 837 332 837
Number of shares in
Issue (`000) 331 015 331 015
Notes
1. The numbers in the Before column is based on the published unaudited
interim results for the six months ended 30 June 2008.
2 The numbers in the After column is based on the following
assumptions:
a. The transaction was implemented and cash flows received with
effect from 1 January 2008 for income statement purposes and
from 30 June 2008 for balance sheet purposes.
b. The cash flows relating to the transaction, including the
distribution of R21,1m to be received in December 2008 and the
loan repayment of R28 million, was applied to repay R49 m of
debt at an interest rate of 2.3% per month.
5. CATEGORISATION OF THE TRANSACTION
The transaction is not categorisable for the purposes of the JSE Listings
Requirements.
6. WITHDRAWAL OF CAUTIONARY ANNOUNCEMENTS
6.1 Having regard to the information set out above shareholders are advised
that the cautionary announcement dated 9 October 2009 is hereby
withdrawn.
6.2 Shareholders are also referred to the cautionary announcement dated 28
August 2008 relating to the possible disposal of the group`s interests in
Grand Parade Investments Limited ("GPI"). The board has reviewed its
strategy in this regard and has resolved that, given the board`s view of
the underlying value of the investment compared to current market
pricing, it is not in the Company`s interests to proceed with such a
disposal. As a result, shareholders are advised that caution is no
longer required when trading in CET shares.
Cape Town
12 November 2008
Sponsor
Sasfin Capital
(A division of Sasfin Bank Limited)
Legal advisors
Cliffe Dekker Hofmeyr Inc
Date: 12/11/2008 12:48:40 Produced by the JSE SENS Department.
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