| Wed 10 Dec 2008, 17:06 | | ERM - Enterprise Risk Management - General repurchase of ordinary shares |
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ERM
ERM
ERM - Enterprise Risk Management - General repurchase of ordinary shares
Enterprise Risk Management Limited
Incorporated in the Republic of South Africa
(Registration number: 1995/001603/06)
Share code: ERM ISIN: ZAE000037701
("ERM" or "the company")
General repurchase of ordinary shares
1 Introduction
In terms of a special resolution passed by ERM shareholders on 29 August 2008, a
general authority was granted to ERM to repurchase its ordinary shares ("the
general authority"). In terms of this general authority ERM could repurchase a
maximum of 11 135 115 ordinary shares (being 20% of the company`s issued share
capital at the date that the general authority was granted).
2 Implementation
As at the close of business on 9 December 2008, ERM has acquired, in the open
market, a total of 5 203 209 ordinary shares, equivalent to 9.346% of the issued
share capital at the time of the granting of the general authority, for a total
consideration of R6 542 896 ("the repurchases"). The repurchases were carried
out over the period 01 December 2008 to 9 December 2008. The highest price paid
was R1.25 per share and the lowest price paid was R1.20 per share. The
repurchases were funded from the company`s available cash resources. All the
ordinary shares have been repurchased by ERM and are to be held in treasury.
The extent of the authority outstanding is in respect of 5 931 906 ordinary
shares, equivalent to 10.654 % of the company`s total issued share capital.
In compliance with the Listings Requirements of the JSE Limited ("Listings
Requirements"), the directors confirm that:
- the repurchases were effected through the order book operated by the JSE
trading system and done without any prior understanding or arrangement
between the company and the counter party;
- the authorisation was given in terms of the company`s articles of
association;
- the general authority was granted at the company`s annual general meeting and
has not extended beyond 15 months from the date of passing of the special
resolution;
- the repurchases were not carried out at a price greater than 10% above the
weighted average of the market value for such ordinary shares for the five
business days immediately preceding the date on which the repurchase of such
shares were effected;
- at any point in time, the company appointed one agent to effect each
individual repurchase on its behalf;
- after the repurchases, the company still complies with paragraphs 3.37 to 3.41
of the Listings Requirements concerning shareholder spread
requirements;
- the repurchases were not carried out during a prohibited period as defined in
paragraph 3.67 of the Listing Requirements; and
- the aggregate repurchases have not exceeded 20% of the company`s issued share
capital pursuant to this general authority.
3 Opinion of the directors
The directors of ERM have considered the impact of the repurchases and are of
the opinion that:
- ERM and the group will be able, in the ordinary course of business, to pay
its debts for a period of 12 months after the date of this announcement;
- the assets of ERM and the group will be in excess of the liabilities of ERM
and the group for a period of 12 months after the date of this announcement.
For this purpose, the assets and liabilities have been recognised and
measured in accordance with the accounting policies used in the latest audited
group annual financial statements;
- the share capital and reserves of ERM and the group will be adequate for
ordinary business purposes for a period of 12 months after the date of this
announcement; and
- the working capital of ERM and the group will be adequate for ordinary
business purposes for a period of 12 months after the date of this announcement.
4 Financial effects
Set out in the table below are the pro forma financial effects of the
repurchases based on ERM`s published reviewed results for the six months ended
31 August 2008. The pro forma financial effects have been prepared for
illustrative purposes only to provide information of how the repurchases may
have impacted on the results and financial position of ERM. The unaudited
proforma financial effects are the responsibility of ERM`s directors. Due to
their nature, the pro forma financial effects may not give a fair reflection of
ERM`s financial position after the repurchases.
Before the After the Percentage
repurchases repurchases change
(cents) (1) (cents) (%)
Earnings per share (cents)(2) -63.6 -67.8 -6.6
Headline earnings per
share (cents) (2) -26.0 -27.70 -6.5
Weighted average number of
shares in issue 54 612 51 259 -6.1
Net asset value per share
(cents) (3) 152.7 158.2 +3.6
Net tangible asset value
per share (cents) (3) 152.7 158.2 +3.6
Shares in issue 54 770 49 567 -9.5
Notes:
1 Extracted from the published interim results of ERM for the six month
period ending 31 August 2008.
2 Earnings and headline earnings per share are based on the following
assumptions:
* the repurchases were effected on 1 March 2008; and
* the repurchases were financed through available cash resources on
which interest accrued at an after tax rate of 8.45% per annum.
3 Net asset value and net tangible asset value per share are based on the
assumptions that the repurchases were carried out on 31 August 2008.
4 The tax rate used is 28%.
Johannesburg
10 December 2008
Sponsor: Sasfin Capital
A division of Sasfin Bank Limited
Date: 10/12/2008 17:06:01 Produced by the JSE SENS Department.
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