| Tue 4 Aug 2009, 9:33 | | KNG - Kingco - Firm Intention To Make An Offer To Minority Shareholders |
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KNG
KNG
KNG - Kingco - Firm Intention To Make An Offer To Minority Shareholders
King Consolidated Holdings Ltd
(Incorporated in the Republic of South Africa)
(Registration number 1992/006472/06)
Share code: KNG ISIN: ZAE000073458
("Kingco" or "the company")
Pocot Trust
(Registered in the Republic of South Africa)
(Registration number TM 3375)
("Pocot Trust")
FIRM INTENTION TO MAKE AN OFFER TO MINORITY SHAREHOLDERS
1. OFFER TO MINORITY SHAREHOLDERS
1.1 Introduction
As indicated in the results for the year ended 28 February 2009, the company
has been experiencing difficult trading conditions and has to a large extent
been dependent upon funding from the controlling shareholder to maintain its
status as a going concern. The poor performance and market resistance to small
capitalisation stocks with limited liquidity has precluded the company from
raising additional capital.
As a result, the necessity for and costs associated with a listing on the JSE
Limited ("the JSE") are not justifiable.
The board of directors of Kingco has received formal notification from Pocot
Trust, an entity controlled by Mr Tony Cotterell, a director of Kingco, to the
effect that Pocot Trust intends making a proposal to acquire the ordinary
shares in Kingco not already held by it. Pocot Trust presently owns or controls
14 832 963 ordinary shares in the company, being 88,6% of its issued share
capital.
The proposal will, if approved by shareholders, result in Kingco becoming
wholly owned by Pocot Trust and its listing on the JSE being terminated.
1.2 Mechanics
Pocot Trust will offer to acquire all the ordinary shares in Kingco not already
held by it ("the scheme shares").
The offer by Pocot Trust to the shareholders of the company, other than Pocot
Trust ("the scheme members"), will be implemented by means of a scheme of
arrangement as more fully set out below.
2. THE SCHEME OF ARRANGEMENT
2.1 Introduction
Pocot Trust will propose a scheme of arrangement in terms of section 311 of the
Companies Act, 1973 (Act 61 of 1973), as amended ("the scheme"), which on
implementation will result in:
- Kingco becoming wholly owned by Pocot Trust; and
- the listing of Kingco on the JSE being terminated.
2.2 Conditions precedent
The approval and implementation of the scheme is subject to:
- the scheme being approved by a majority representing three-fourths of the
votes exercisable by the scheme members present and voting either in person or
by proxy at a meeting of the scheme members ("the scheme meeting"); and
- the scheme being sanctioned by the South Gauteng High Court (Johannesburg)
and the Order of Court being registered by the Registrar of Companies.
2.3 Scheme consideration
In terms of the scheme, the scheme members will receive 40 cents per share in
cash per scheme share. Proof to the satisfaction of the Securities Regulation
Panel ("the SRP") has been provided by an acceptable third party to the effect
that the necessary funds will be available to discharge the scheme
consideration should the scheme be implemented.
2.4 Financial effects of the scheme
The financial effects of the scheme on the market value and the asset values
attributable to the holder of 100 Kingco shares set out below are based on:
- the closing market price of Kingco on 31 July 2009, being the last
practicable trading date prior to this announcement; and
- the net asset value and net tangible asset value for the financial year ended
on 28 February 2009.
Before the scheme: After the scheme: Percentage
100 Kingco shares Scheme consideration increase
Market value (R) 30,00 40,00 33,33
Net asset value (R) 10,00 40,00 300
Net tangible
asset value (R) 10,00 40,00 300
2.5 Termination of listing on the JSE
Subject to the scheme becoming effective, it is anticipated that the listing of
Kingco on the JSE will be terminated with effect from the commencement of
trading on Tuesday, 20 October 2009, which is the anticipated date for the
scheme becoming effective.
3. DOCUMENTATION
A circular to shareholders containing the scheme is being prepared and will,
subject to the approvals of the JSE and the SRP be posted to the scheme members
within 28 days of this announcement.
4. SALIENT DATES
An announcement of the salient dates governing the convening of the scheme
meeting will be published in due course.
By order of the board
Pinegowrie
4 August 2009
Sponsor
ARCAY MOELA SPONSORS
Independent professional advisor
CHARLES ORBACH & COMPANY
Corporate Finance Proprietary Limited
Attorneys
FLUXMANS ATTORNEYS
Date: 04/08/2009 09:33:01 Produced by the JSE SENS Department.
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