| Thu 20 Nov 2008, 17:00 | | KWS - Kwikspace - Firm intention to make an offer to acquire and withdrawal |
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KWS
KWS
KWS - Kwikspace - Firm intention to make an offer to acquire and withdrawal
of cautionary announcement
KWS - Kwikspace Modular Buildings Limited
(Formerly Kwikspace Modular Buildings (Proprietary) Limited)
Incorporated in the Republic of South Africa
(Registration Number 1997/008959/06)
ISIN: ZAE000104287
Share Code: KWS
("Kwikspace" or "the Company")
Absa Capital Private Equity (Proprietary) Limited
Vantage Capital Kwikspace Investments (Proprietary) Limited
FIRM INTENTION TO MAKE AN OFFER TO ACQUIRE THE ISSUED ORDINARY SHARE CAPITAL
OF KWIKSPACE, EXCLUDING THOSE SHARES HELD BY VANTAGE CAPITAL KWIKSPACE
INVESTMENTS (PROPRIETARY) LIMITED ("VANTAGE") AND CERTAIN SHARES HELD BY
CERTAIN CURRENT MEMBERS OF THE MANAGEMENT OF KWIKSPACE ("KWIKSPACE
MANAGEMENT") ("SCHEME SHARES") AND WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT
1. Introduction
Further to the previously released cautionary announcements, the last of
which was released on 15 October 2008, the shareholders of Kwikspace
("shareholders") are advised that a consortium of private equity
investors led by Absa Capital Private Equity (Proprietary) Limited
("ACPE") and Vantage Capital Kwikspace Investments (Proprietary) Limited
("Vantage") (collectively the "Consortium"), acting through Clidet No
803 (Proprietary) Limited ("Bidco"), has submitted a firm intention to
make an offer to the board of directors of Kwikspace ("Board") to
acquire the scheme shares ("Offer").
The Consortium also includes Kwikspace Management. Kwikspace Management
hold 11.46% (eleven point four six percent) of the entire issued
ordinary share capital of Bidco.
If the Offer is implemented, all the shares in the issued share capital
of Kwikspace ("shares") will be delisted from the stock exchange
operated by the JSE Limited ("JSE").
2. Terms of the Offer
2.1 Consideration
The proposed purchase consideration per scheme share is 800 (eight
hundred) cents ("scheme consideration") with a total aggregate scheme
consideration of R478 213 112 based on 59 776 639 scheme shares in
issue. At 800 cents per scheme share, the scheme consideration
represents a premium of:
Before the Premium (%)
scheme (cents)
Market price on 29 August 2008 664 (1) 20.5
Market price on 19 November 2008 552 (2) 44.9
Notes:
1. Closing price of Kwikspace shares on the JSE on 29 August
2008, being the last trading day prior to publication of the
first cautionary announcement by Kwikspace.
2. Closing price of Kwikspace shares on the JSE on 19 November
2008, being the last trading day prior to the publication of
this announcement
3. The information reflected in the table above does not take
into account any possible dividend and interest entitlements.
2.2 Interest
Interest will be payable from 1 February 2009 on the outstanding scheme
consideration until the date of payment of the scheme consideration, at
the rate of interest on overnight call deposits (compounded monthly in
arrears and calculated on a 365 (three hundred and sixty five) day year
irrespective of whether or not the year is a leap year) quoted from time
to time by FirstRand Bank Limited.
2.3 Cash confirmation
The total funding required for the transaction is R478 213 112. The
funding required will be raised through a combination of equity funding
provided by the Consortium and various financing instruments provided by
Investec Bank Limited ("Investec"). ACPE, Investec on behalf of Vantage
and Investec as debt provider have confirmed to the satisfaction of the
Securities Regulation Panel ("SRP") that there are sufficient resources
available to Bidco to fully satisfy its obligations in respect of the
scheme consideration.
2.4 Mechanism
It is envisaged that the Offer will be implemented by way of a scheme of
arrangement between Kwikspace and the shareholders, other than Vantage
and Kwikspace Management, in terms of section 311 of the Companies Act
(No 61 of 1973, as amended) ("the Act") ("the Scheme").
2.5 Independent advice
The Board will appoint an independent expert to provide it with an
independent opinion regarding the terms of the Offer. The details of
the independent expert, the independent expert`s advice, as well as the
Board`s opinion on the terms of the Offer will be disclosed to
shareholders in due course.
2.6 Irrevocable undertaking from shareholders
The following major shareholders of Kwikspace, holding 26.3% (twenty six
point three percent) of the total issued share capital and holding 42.2%
(forty two point two percent) of the shares eligible to vote at the
scheme meting, have irrevocably undertaken to vote in favour of the
Scheme:
Shareholder Number of Percentage of
shares shares eligible
to vote at the
scheme meeting
Peregrine Capital 6 600 000 12.4%
(Proprietary) Limited
Stanlib Asset Management 4 546 195 8.6%
FL Avis / Avis Family Trust 3 938 099 7.4%
JMMC Ackerman 2 531 007 4.8%
SP Stacey 1 904 641 3.6%
AC Bishop 1 072 072 2.0%
KH Cooper 929 674 1.8%
DR Fensham 899 276 1.7%
In addition, the Consortium has obtained undertakings of support from
additional shareholders who, at the date of this announcement, held
30.1% of the scheme shares. Accordingly, shareholders holding 72.3% of
the shares eligible to vote at the scheme meeting are in support of the
Offer.
2.7 Conditions precedent
The implementation of the Offer will be subject, inter alia, to the
fulfilment or waiver, where applicable, of the following conditions
precedent:
* all necessary regulatory and third party approvals and consents in
respect of the Offer having been obtained, including but not limited
to approvals from the South African competition authorities, the JSE,
the SRP and the South African Reserve Bank;
* the High Court of South Africa ("Court") having authorised the
convening of a meeting of the shareholders to consider the Scheme
("scheme meeting");
* the approval of the Scheme by 75% (seventy five percent) or more of
the votes exercisable by the shareholders present and voting, in
person or by proxy, at the scheme meeting, having been obtained;
* the Court having sanctioned the Scheme and a certified copy of the
order of Court sanctioning the Scheme having been registered by the
Companies and Intellectual Property Registration Office ("CIPRO") in
terms of the Act; and
* no MAC having arisen between 20 November 2008 and the
day immediately preceding the date on which the order of Court
sanctioning the Scheme is registered with CIPRO. For the purposes
hereof, a MAC shall mean the occurrence of any event or act which will
have, or is reasonably likely to have, during the 12 month period
beginning on 19 November 2008 (individually or in aggregate), any of
the following effects on Kwikspace -
- a reduction in the earnings before interest, tax, depreciation and
amortisation ("EBITDA") of Kwikspace exceeding 10% of the EBITDA of
Kwikspace for the 12 months ended 31 May 2008; or
- a cumulative reduction of assets and/or increase in liabilities to
Kwikspace exceeding 10% (ten percent) or more of the market
capitalisation of Kwikspace, as at 19 November 2008.
* prior to the date on which the order of Court sanctioning the Scheme
is registered with CIPRO, Kwikspace not having undertaken or allowed
to occur any frustrating action (as described in Rule 19 of the SRP
Code); and
* Bidco having obtained the written approval from the relevant
counterparties for the cession of all the rights of Kwikspace and the
delegation to a wholly owned subsidiary of Bidco of all the
obligations of Kwikspace, under certain legal agreements.
3. DOCUMENTATION
A circular providing further information on the offer and containing,
inter alia, a notice of scheme meeting, an order of Court, forms of
proxy and a form of surrender and transfer is expected to be posted to
Kwikspace shareholders on 18 December 2008.
4. Salient dates
The salient dates relating to the scheme are set out below
Scheme circular mailed to shareholders Thursday 18 December 2008
Shareholder (scheme) meeting Tuesday 13 January 2009
Results of scheme meeting published on Wednesday 14 January 2009
Securities Exchange News Service of the
JSE ("SENS")
Results of the scheme meeting published Thursday 15 January 2009
in the press
Lodge documents with Court for Scheme Thursday 15 January 2009
sanctioning
Court hearing to sanction the scheme Tuesday 3 February 2009
Register court order with CIPRO Thursday 5 February 2009
Finalisation announcement published on Friday 6 February 2009
SENS
Last day to trade to participate in Friday 13 February 2009
Scheme
Kwikspace shares suspended on the JSE Monday 16 February 2009
Record date for the Scheme Friday 20 February 2009
Anticipated pay date Monday 23 February 2009
Listing of Kwikspace shares terminated Tuesday 24 February 2009
at commencement of trading
Notes:
1. These dates and times are subject to change. Any material change will
be released on SENS and published in the press.
2. Share certificates may not be dematerialised or rematerialised after
Friday, 13 February 2009.
5. WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT
Kwikspace shareholders are advised that the cautionary announcements
concerning the offer are hereby withdrawn.
Kliprivier
20 November 2008
Merchant bank to the Consortium and transaction sponsor
FirstRand Bank Limited, acting through Rand Merchant Bank
Legal advisor to Kwikspace
Prinsloo, Tindle & Andropoulos Incorporated
Funder to the Consortium
Investec Bank Limited
Sponsor to Kwikspace
JPMorgan Equities Limited
Legal advisors to the Consortium
Cliffe Dekker Hofmeyr Incorporated
Taxation advisor to the Consortium
Ernst & Young Advisory Services Limited
Date: 20/11/2008 17:00:01 Produced by the JSE SENS Department.
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implicitly, represent, warrant or in any way guarantee the truth, accuracy or
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