| Wed 20 May 2009, 14:18 | | TKG - Telkom - Unbundling of Vodacom - Apportionment of cost for tax purposes |
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TKG
TKG
TKG - Telkom - Unbundling of Vodacom - Apportionment of cost for tax purposes
Telkom SA Limited
(Incorporated in the Republic of South Africa)
(Registration number 1991/005476/06)
(JSE and NYSE share code: TKG)
(ISIN: ZAE000044897)
("Telkom")
UNBUNDLING OF VODACOM - APPORTIONMENT OF COST FOR TAX PURPOSES
1. Introduction
Telkom shareholders are referred to the circular to Shareholders dated 2 March
2009 ("circular"), and the revised Salient Dates and Times Announcement, dated
17 April 2009 ("revised salient dates and times Announcement"), regarding, inter
alia, the unbundling of Telkom`s remaining stake in Vodacom Group (Proprietary)
Limited ("Vodacom"). As set out in the circular and the revised salient dates
and times Announcement, the distribution of the shares in Vodacom to Telkom
shareholders recorded in the register as at the close of business on Friday, 22
May 2009 ("the record date") will be effected by way of a distribution in specie
in terms of Section 46 of the Income Tax Act, 1962, as amended, in the ratio of
one Vodacom share for every Telkom share held on the record date.
Shareholders are advised that Vodacom shares commenced trade on the JSE Limited
("JSE") with effect from the opening of business on Monday, 18 May 2009. The
purpose of this announcement is to notify Telkom shareholders of the ratio to be
used in the apportionment for tax purposes of the base cost of a Telkom share
between the Telkom share after the unbundling and the Vodacom share received in
terms of the unbundling.
2. Apportionment ratio
The ratio of the respective market values of a Telkom share and a Vodacom share
on the JSE as at 17:00 on Monday, 18 May 2009, being the listing date, was
50,51% relating to a Telkom share and 49,49% relating to a Vodacom share ("the
apportionment ratio").
The apportionment ratio is to be used to apportion the base cost of a Telkom
share between a Telkom share after the unbundling and a Vodacom share received
in terms of the unbundling for the determination of profits and losses, of a
capital or trading nature, derived on any future disposals of such Telkom shares
or Vodacom shares. A summary of the South African tax considerations is set out
on pages 31 and 32 of the circular.
Telkom
Pretoria
20 May 2009
Financial advisers to Telkom
J.P. Morgan Chase Bank, N.A. (Johannesburg Branch) and Vermogen Financial
Services (Pty) Ltd trading as IDG Financial Services
Transaction sponsor to Telkom
J.P. Morgan Equities Ltd
South African legal advisers to Telkom
Werksmans Inc. and Mchunu Koikanyang Inc.
US legal advisors to Telkom
Paul, Hastings, Janofsky & Walker LLP
Special note regarding forward-looking statements
Many of the statements included in this announcement, as well as oral statements
that may be made by Telkom and Vodacom, or by officers, directors or employees
acting on their behalf related to the subject matter hereof, constitute or are
based on forward-looking statements within the meaning of the U.S. Private
Securities Litigation Reform Act of 1995, specifically Section 27A of the U.S.
Securities Act of 1933, as amended, and Section 21E of the U.S. Securities
Exchange Act of 1934, as amended. All statements, other than statements of
historical facts, including, among others, statements regarding Telkom`s ability
to successfully complete the Transaction and its effects on Telkom`s operations,
Telkom`s ability to implement its mobile strategy and any changes thereto,
Telkom`s future financial position and plans, strategies, objectives, capital
expenditures, projected costs and anticipated cost savings and financing plans,
as well as projected levels of growth in the communications market, are forward-
looking statements. Forward-looking statements can generally be identified by
the use of terminology such as "may", "will", "should", "expect", "envisage",
"intend", "plan", "project", "estimate", "anticipate", "believe", "hope", "can",
"is designed to" or similar phrases, although the absence of such words does not
necessarily mean that a statement is not forward-looking. These forward-looking
statements involve a number of known and unknown risks, uncertainties and other
factors that could cause Telkom`s actual results and outcomes to be materially
different from historical results or from any future results expressed or
implied by such forward-looking statements. Among the factors that could cause
Telkom`s actual results or outcomes to differ materially from its expectations
are those risks identified in Item 3. "Key Information-Risk Factors" contained
in Telkom`s most recent annual report on Form 20-F filed with the U.S.
Securities Exchange Commission ("SEC") and Telkom`s other filings and
submissions with the SEC, which are available on Telkom`s website at
www.Telkom.co.za/ir and other matters not yet known to Telkom or not currently
considered material by Telkom.
Telkom caution you not to place undue reliance on these forward-looking
statements. All written and oral forward-looking statements attributable to
Telkom, or persons acting on Telkom`s behalf, are qualified in their entirety by
these cautionary statements. Moreover, unless Telkom is required by law to
update these statements, Telkom will not necessarily update any of these
statements after the date of Telkom`s most recent annual report on Form 20-F
filed with the US Securities and Exchange Commission (SEC), either to conform
them to actual results or to changes in Telkom`s expectations.
THIS IS NOT AN OFFER OF SECURITIES FOR SALE IN THE UNITED STATES AND SECURITIES
MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES ABSENT REGISTRATION OR AN
EXEMPTION FROM REGISTRATION. THERE WILL BE NO PUBLIC OFFERING OF VODACOM
SECURITIES IN THE UNITED STATES THAT WOULD REQUIRE REGISTRATION.
Date: 20/05/2009 14:18:20 Produced by the JSE SENS Department.
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