| Wed 10 Dec 2008, 12:00 | | TBS - Tiger Brands - Announcement Regarding the Pro Forma Financial Effects of |
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TBS
TIIH
TBS - Tiger Brands - Announcement Regarding the Pro Forma Financial Effects of
the Disposal of 73.16% of the Sea Harvest Corporation Limited Ordinary Shares
TIGER BRANDS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1944/017881/06)
Share code: TBS
ISIN: ZAE000071080
("Tiger Brands" or "the company")
ANNOUNCEMENT REGARDING THE PRO FORMA FINANCIAL EFFECTS OF THE DISPOSAL OF 73.16%
OF THE SEA HARVEST CORPORATION LIMITED ("SEA HARVEST") ORDINARY SHARES IN ISSUE
TO A BRIMSTONE LED CONSORTIUM (THE "TRANSACTION") AND WITHDRAWAL OF CAUTIONARY
ANNOUNCEMENT IN RELATION TO THE TRANSACTION
1. Introduction
Tiger Brands shareholders are referred to the joint terms announcement released
by Tiger Brands and Brimstone Investment Corporation Limited ("Brimstone") on 31
October 2008 where it was announced that a consortium led by Brimstone, which
includes members of Sea Harvest management, have submitted an offer (the
"Offer") to purchase 78 753 841 Sea Harvest ordinary shares held by Tiger
Brands, representing 73.16% of the total number of Sea Harvest ordinary shares
in issue. The Offer has been accepted by Tiger Brands and is subject to certain
conditions precedent, which are set out in the aforementioned joint terms
announcement.
2. Pro forma financial effects
Based on Tiger Brands published annual results for the twelve months ended 30
September 2008, the unaudited pro forma financial effects of the Transaction on
Tiger Brands earnings and headline earnings per share and net asset value and
net tangible asset value per share are set out below. The unaudited pro forma
financial information has been prepared for illustrative purposes only and
because of its nature may not give a fair presentation of Tiger Brands financial
position and results of operations after taking into account the effect of the
Transaction on Tiger Brands. The preparation of the pro forma financial
information is the responsibility of Tiger Brands directors.
Per Tiger Brands share Before the After the
(cents) Transaction Transaction Percentage
(1) (5-7) change
Basic earnings(2) 1 440.0 1 508.0 4.72%
Diluted basic earnings(3 ) 1 433.3 1 500.9 4.72%
Headline earnings(2) 1 524.1 1 561.5 2.45%
Diluted headline earnings(3) 1 517.0 1 554.2 2.45%
Net asset value(4) 3 673.4 3 758.8 2.32%
Tangible net asset value(4) 2 580.5 2 677.1 3.74%
Notes
(1) Based on the published reviewed group results of Tiger Brands for the year
ended 30 September 2008.
(2) Basic earnings per share and headline earnings per share are based on 157.9
million shares, being the weighted average number of shares in issue
(excluding treasury shares as well as shares held by certain empowerment
trusts which are eliminated on consolidation) for the year ended 30
September 2008.
(3) Based on a diluted number of shares of 158.6 million.
(4) Net asset value per share and tangible net asset value per share are based
on 156.8 million shares, being the total number of shares in issue of 173.0
million less treasury shares of 10.3 million and shares held by the
empowerment trusts of 5.9 million.
(5) The pro forma financial effects for basic earnings per share and headline
earnings per share assume an effective date for the Transaction of 1
October 2007, whilst net asset value per share and tangible net asset value
per share assume an effective date of 30 September 2008.
(6) The pro forma financial effects are based on a purchase price of R541.4
million for the interest of 73.16% in Sea Harvest.
(7) The following factors are taken into account in the calculation of the pro
forma financial effects:
- interest on the proceeds calculated at the Tiger Brands group`s
average borrowing rate as from 1 October 2007;
- release to income of the fair value adjustment in respect of the Sea
Harvest put option amounting to R81.4million;
- a capital profit of R52.4 million arising on the disposal of the
shares in Sea Harvest; and
- an effective interest in Sea Harvest of 74.64%%, taking into account
the treasury shares held by The Sea Harvest Employee Share Trust which
are eliminated on consolidation.
3. Categorisation of the Transaction and small related party transaction
In terms of the JSE Limited Listings Requirements, the Transaction will be
categorised as a small related party transaction for Tiger Brands.
Accordingly, Tiger Brands is required to appoint an independent professional
expert to provide an opinion confirming that the terms and conditions of the
Transaction are fair to Tiger Brands shareholders (the "Fairness Opinion"). The
Transaction will therefore be subject to obtaining the Fairness Opinion.
Details of the Fairness Opinion will be announced by Tiger Brands as soon as
practicable after the publication of this announcement and the Fairness Opinion
statement will lie for inspection at the registered offices of Tiger Brands for
a period of 28 days from the date on which the announcement regarding the
Fairness Opinion is released on SENS.
4. Withdrawal of cautionary announcement in relation to the Transaction
Tiger Brands shareholders are referred to the cautionary announcement dated 31
October 2008 and are advised that the cautionary is withdrawn in relation to the
Transaction. However, Tiger Brands shareholders should note that the company
remains under caution and are referred to the announcement dated 17 November
2008 in relation to a potential offer for AVI Limited ("Potential AVI
Transaction"). Tiger Brands shareholders are therefore advised to continue to
exercise caution when dealing in Tiger Brands securities until such time as a
further announcement is made in relation to the Potential AVI Transaction.
Bryanston
10 December 2008
Sponsor to Tiger Brands
J.P. Morgan Equities Limited
Legal advisers to Tiger Brands
Edward Nathan Sonnenbergs
Date: 10/12/2008 12:00:01 Produced by the JSE SENS Department.
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