| Wed 17 Jun 2009, 14:56 | | PPE - Purple Capital - Update on disposals debt reduction programme and global |
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PPE
PPE
PPE - Purple Capital - Update on disposals, debt reduction programme and global
trader
Purple Capital Limited
(Incorporated in the Republic of South Africa)
(Registration number 1998/013637/06)
Share code: PPE & ISIN: ZAE000071411
("Purple Capital" or "the company")
UPDATE ON DISPOSALS, DEBT REDUCTION PROGRAMME AND GLOBAL TRADER
Purple Capital has continued on its stated objective of debt reduction. The
following disposals are in the process of being completed with any outstanding
cash flows expected to be received by mid-July:
Disposal Expected cash flow
effect (R million)
Acsis Limited ("acsis") 32,00
Bond Exchange of South Africa 12,85
Limited ("BESA")
Integer (Pty) Limited ("Integer") 9,39
Cape Empowerment Trust Limited 9,55
("CET")
Total expected cash flow from 63,79
disposals
acsis
Shareholder approval for the sale of Purple Capital`s 20% stake in acsis was
obtained on 21 April 2009. A total of 10% of the total sales consideration of
R32 million (i.e. R3,2 million) will be retained (bearing interest at prime) for
a period of 2 years subject to any claims by the purchasers, Old Mutual - no
claims are expected.
BESA
All conditions precedent for the acquisition of BESA by the JSE Limited have
been fulfilled and Purple Capital expects the proceeds from the sale of its 5,3%
stake by 22 June 2009.
Integer
Following a final write down of R10,7 million to take account of the increase in
provisions and the elimination of any premium to face value of the mortgage loan
book, Purple Capital has disposed of its stake in Integer to Investec Bank
Limited for a nominal value subject to the fulfilment of certain conditions and
obtaining regulatory approvals as may be required. The result will be a net
reduction of R9,39 million of outstanding loans (as detailed above).
Purple Capital has no further obligations whatsoever, funding or otherwise, in
respect of Integer.
CET
Purple Capital disposed of its 23,9 million shares in CET (on the open market)
on 12 June 2009 for a total cash consideration of R9 554 114.40 being 40 cents
per share - realising a pre-tax profit of R3 821 645.76 from the carrying value
as at 28 February 2009.
In terms of the JSE Listings Requirements, the sale is a Category 2 disposal
(not requiring shareholder approval). CET is a diversified BEE investment group
with substantial businesses and investments in Property, Gaming and Leisure,
Security and Services, Financial Services and Information, Communications and
Technology. The CET-Purple Capital cross shareholding deal (concluded in
November 2006) never achieved the synergies it originally intended - it was
therefore in Purple Capital`s best interest to dispose of its shareholding.
The total sale proceeds will be used to repay outstanding debt.
Unaudited pro-forma financial effects of the sale of Purple Capital`s
shareholding in CET
As at 28 Effect of After %
February disposal of disposal change
2009 (1) shareholding of CET
in CET (3) &
(4)
Loss per (10,35) 0,65 (9,70) 6,67%
share (cents)
Headline loss (10,35) 0,65 (9,70) 6,67%
per share
(cents)
NAV per share 43,36 0,46 43,82 1,06%
(cents)
NTAV per 6,13 0,46 6,59 7,50%
share (cents)
Notes:
1. Extracted from the published, reviewed interim results of Purple Capital
for the six months ended 28 February 2009.
2. It has been assumed that the disposal took place on 1 September 2008 for
income statement purposes and 28 February 2009 for balance sheet purposes.
3. The "After disposal of CET, loss and headline loss per share" has been
adjusted for the after-tax profit on disposal and the interest saving on
repayment of outstanding loans.
4. The "After disposal of CET, NAV per share and NTAV per share" has been
adjusted for the receipt of the total sales proceeds and the utilisation
thereof to repay outstanding loans.
Unaudited impact on NAV
Cents per share
NAV per share at 28 February 2009 43,36
Net effect of stated disposals (1,04)
Mark-to-market of listed investments* 0,34
Adjusted NAV per share** 42,66
*Based on the ruling market prices of listed investments as at 12 June 2009
** Unlisted investment valuations will be audited at year-end and are assumed
unchanged (for the purpose of this announcement) from 28 February 2009.
As a result of the abovementioned disposals, debt will be reduced to
approximately R18,0 million which compares to R163,0 million outstanding at 31
August 2008.
Global Trader
Global Trader`s client deposit base has more than doubled since the beginning of
the financial year, signalling a strong return of investor confidence in Global
Trader, its business practices, products and services. The withdrawal of
significant competition and stronger local equity markets have also seen the CFD
business grow over 100% during the first six months of the calendar year.
Global Trader continues to lead the market through innovation, having recently
launched binary options and Mini CFDs (first for the South African market place)
both already posting positive returns to the bottom line. The extension of
Global Trader`s services to self directed full service broking has introduced
traditional equity trading and education services with a full launch scheduled
for July 2009.
Johannesburg
17 June 2009
Sponsor: KPMG Services (Pty) Ltd
Date: 17/06/2009 14:56:01 Produced by the JSE SENS Department.
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