| Fri 14 Nov 2008, 10:27 | | GMB - Glenrand MIB - Acquisition Of A Minority Shareholding In Glenrand MIB |
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GMB
GMB
GMB - Glenrand MIB - Acquisition Of A Minority Shareholding In Glenrand MIB
Credit And Political Risk Consultants (Proprietary) Limited ("Credit")
GLENRAND MIB LIMITED
(Incorporated in the Republic of South Africa)
Licensed Financial Services Provider
(Registration number 1997/008001/06)
Share code : GMB & ISIN : ZAE000078010
("the company" or "Glenrand MIB " or "the group")
ACQUISITION OF A MINORITY SHAREHOLDING IN GLENRAND MIB CREDIT AND POLITICAL RISK
CONSULTANTS (PROPRIETARY) LIMITED ("CREDIT")
1. Introduction
Shareholders are advised that Glenrand MIB has reached agreement with
Estate Late Glenn Botha ("Botha"), to purchase Botha`s entire shareholding
and claims in Credit ("the acquisition"), with immediate effect.
2. Nature of business
Randburg-based Credit is an authorised financial services provider
operating as a credit and political risk insurance broker.
3. Rationale for the acquisition
Glenrand MIB currently holds 70% of the ordinary shares in issue in Credit.
Botha, a minority shareholder, holding 10% of the ordinary shares in issue
in Credit, passed away on 25 December 2005. The remaining two minority
shareholders assigned their pre-emptive rights to this shareholding to
Glenrand MIB on 15 June 2007. This follows the provisions of the
shareholders` agreement concluded between Glenrand MIB and the minorities
on 15 November 2002.
4. Consideration
The consideration for the acquisition is R 2 547 188, payable immediately
and to be financed through Glenrand MIB`s internally generated cash
resources.
5. Fairness opinion
As Glenrand MIB is transacting with a material shareholder of Credit, an
existing subsidiary, the acquisition is considered a small related party
transaction in terms of the JSE Limited ("JSE") Listings Requirements.
Glenrand MIB have therefore appointed an independent expert, AMB Capital
Limited ("AMB"), to review the terms of the acquisition.
AMB have reviewed the terms and conditions of the acquisition following an
independent valuation performed. AMB are of the opinion that these terms
and conditions are fair to Glenrand MIB shareholders. AMB has also
expressed this opinion in writing and such opinion is available for
inspection at the company`s registered office for a period of 28 days after
the date of this announcement.
6. Financial effects of the acquisition
Based on the audited results for the year ended 30 June 2008, the unaudited
pro forma financial effects of the acquisition on Glenrand MIB`s earnings,
headline earnings and net asset value per share have not been disclosed as
these effects are not significant. The effect on net tangible asset value
per share ("NTAV"), being significant, is set out below. This unaudited pro
forma financial information has been prepared for illustrative purposes
only and because of its nature may not give a fair reflection of Glenrand
MIB`s financial position and results of operations, nor of the effect and
impact of the acquisition on Glenrand MIB. The preparation of the pro forma
financial information is the responsibility of Glenrand MIB`s directors.
Before the acquisition(1) After the % Change
acquisition(2)(3)
NTAV (3.4) (4.5) 32.0
(cents)
Notes:
1. Based on the published audited results of Glenrand MIB for the year
ended 30 June 2008.
2. Based on the assumption that the acquisition occurred on 30 June 2008
for balance sheet purposes.
3. After taking into account the pro forma consolidated effects of the
increased investment in Credit of R2 547 188. R834 920 is ascribed to
Credit`s net assets at 30 June 2008 and R1 712 268 is ascribed to
goodwill.
7. Suspensive conditions
All suspensive conditions relating to the acquisition have been fulfilled.
Randburg
14 November 2008
Investment bank and sponsor
Nedbank Capital
Independent expert
AMB Capital Limited
Date: 14/11/2008 10:27:21 Produced by the JSE SENS Department.
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