| Fri 14 Aug 2009, 10:35 | | IPL - Imperial Holdings Limited - Voluntary Announcement Regarding The Disposal |
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IPL
IPL
IPL - Imperial Holdings Limited - Voluntary Announcement Regarding The Disposal
Of Imperial Holdings` Interests In Imperial Bank Limited ("Imperial Bank" Or
"The Bank") To Nedbank Group Limited ("Nedbank")
Imperial Holdings Limited
Registration number: 1946/021048/06
Share code: IPL
ISIN: ZAE000067211
("Imperial" or "the group")
Voluntary announcement regarding the disposal of Imperial Holdings` interests in
Imperial Bank Limited ("Imperial Bank" or "the bank") to Nedbank Group Limited
("Nedbank")
1. Introduction
Shareholders are referred to the cautionary announcement released on the
Securities Exchange News Service on 29 May 2009, and renewed on 13 July
2009, advising shareholders that Imperial had entered into discussions with
Nedbank regarding the disposal to Nedbank of the remaining shares in
Imperial Bank not already owned by Nedbank.
A non-binding memorandum of understanding has been concluded between
Imperial and Nedbank in terms of which it has been agreed, in principle,
that Nedbank would acquire Imperial`s 49,9% shareholding in Imperial Bank
for a consideration of R1 775 million ("the Purchase Consideration").
A further announcement will be made once Imperial and Nedbank have
concluded binding agreements.
It has further been agreed in principle that the Group`s motor dealerships
will enter into arrangements with Nedbank so as to allow these dealerships
to benefit from the marketing and facilitation of vehicle finance and sales
of ancillary products. Accordingly, the synergistic vehicle retailing and
financial services product range which Imperial currently offers to its
customers will continue uninterrupted.
2. Nature of the businesses being sold
Imperial Bank consists of four asset based finance divisions, specifically:
Vehicle Finance, Supplier Asset Finance, Property Finance, and Professional
Finance.
Vehicle Finance
In November 1995, Imperial established Imperial Bank to provide asset based
finance in the South African market and to focus on motor vehicle finance
for customers of the group and other motor dealerships. In 2001, Imperial
Bank branded its vehicle finance business "Motor Finance Corporation" (MFC)
as an independent brand. MFC is primarily focused on servicing the dealer
channel in which segment it is well established. This division had total
assets of R30,3 billion at 30 June 2009, and reported a net profit for the
six months to 30 June 2009 of R68,6 million
Property Finance
Imperial Bank Property Finance focuses on medium sized commercial mortgages
and property developments. This division had total assets of R8,4 billion
at 30 June 2009, and reported a net profit for the six months to 30 June
2009 of R41,1 million.
Supplier Asset Finance
Supplier Asset Finance focuses on financing in niche markets including
suppliers of "yellow goods" (i.e. vehicles and equipment used in the
construction and mining industries). This division had total assets of R3,5
billion at 30 June 2009, and reported a net loss for the six months to 30
June 2009 of R9,6 million.
Professional Finance
Professional Finance focuses principally on the provision of finance to
medical and dental professionals. This division had total assets of R5,1
billion at 30 June 2009, and reported a net profit for the six months to
30 June 2009 of R10,5 million.
3. Rationale for the Disposal
The business of Imperial Bank has grown strongly since its establishment,
and is expected to continue to grow, especially in the field of vehicle
finance. Currently, Imperial is obliged to provide its pro rata share of
the capital requirements of the bank, which will increase as the bank
continues to grow. Imperial prefers to employ its capital in its core
business, including logistics and tourism. The cash generating capacity of
Imperial will be significantly enhanced by the sale, as the sale proceeds
will be released in cash and the group will have no further capital
requirements in respect of Imperial Bank.
4. Conditions precedent to the disposal
The proposed disposal will be subject to various regulatory approvals and
conditions precedent.
5. Settlement of the purchase consideration
It is anticipated that up to a maximum of approximately 80% of the purchase
consideration will be settled in Nedbank shares and the balance in cash.
Imperial Holdings intends to place shares received for cash in due course.
6. Categorisation of the Disposal in terms of the Listings Requirements
The disposal is classified as a category 2 transaction in terms of the
Listings Requirements. The JSE does not require the approval of
shareholders for a category 2 transaction.
7. Cautionary Announcement
Discussions with Nedbank regarding Imperial Bank are not finalised.
Accordingly, shareholders are referred to the cautionary announcement
published on 29 May 2009 and renewed on 13 July 2009, and are reminded to
continue to exercise caution when dealing in the company`s shares.
Company Secretary
RA Venter
Bedfordview
14 August 2009
Independent sponsor to Imperial Holdings:
Merrill Lynch South Africa (Pty) Limited
Attorneys:
Tugendhaft Wapnick Banchetti and Partners
Date: 14/08/2009 10:35:03 Produced by the JSE SENS Department.
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