| Wed 16 Sep 2009, 16:12 | | IPL / IPLP - Imperial - Category 2 announcement regarding the disposal of |
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IPL IPLP
IPL
IPL / IPLP - Imperial - Category 2 announcement regarding the disposal of
Imperial Holdings` interests in Imperial Bank Limited ("Imperial Bank"
or "the bank") held by Imperial`s subsidiary, Imperial Financial
Holdings Limited ("Imperial"), to Nedbank Limited ("Nedbank")("the
disposal")
Imperial Holdings Limited
Registration number: 1946/021048/06
Ordinary share code: IPL ISIN: ZAE000067211
Preference share code: IPLP ISIN: ZAE000088076
("Imperial" or "the group")
Category 2 announcement regarding the disposal of Imperial Holdings`
interests in Imperial Bank Limited ("Imperial Bank" or "the bank") held by
Imperial`s subsidiary, Imperial Financial Holdings Limited ("Imperial"), to
Nedbank Limited ("Nedbank")("the disposal")
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
and 25 August 2009 as well as the voluntary announcement released on 14
August 2009("the Voluntary Announcement"), 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 binding agreement has now been concluded between Imperial and Nedbank in
terms of which Nedbank will acquire Imperial`s shareholding of 49.9% of the
ordinary shares ("Ordinary Shares") in Imperial Bank. The purchase
consideration will be settled in instalments over a six month period
commencing on the fulfilment of the conditions precedent, the present value
thereof being approximately R1 775 million as at 30 June 2009.
This announcement is published in compliance with the Listings Requirements
of JSE Limited ("Listings Requirements") and to provide shareholders with
additional information regarding the disposal. For additional information
relating to the Imperial Bank businesses and the rationale for the disposal,
please refer to the Voluntary Announcement.
2. Conditions precedent to the disposal
The disposal is subject to the following regulatory approvals and conditions
precedent:
2.1 the approval of the competition authorities, insofar as it is necessary;
2.2 compliance with the Listings Requirements;
2.3 Nedbank Group obtaining a fairness opinion that declares that the
acquisition is fair in compliance with the Listings Requirements as the
acquisition of the Imperial Bank shares by Nedbank is classified as a small
related party transaction in terms of the Listings Requirements;
2.4 the Securities Regulation Panel, confirming in writing that it does not
object to or has no jurisdiction in respect of Imperial Financial Holdings`
voting in respect of the resolutions contemplated in 2.5 below;
2.5 the passing, and to the extent necessary registration, of a special
resolution of Imperial Bank approving the sale of Imperial Bank`s assets, as
required in terms of section 228 of the Companies Act, 1973 ("Companies Act")
and a resolution for the transfer of the assets and liabilities of Imperial
Bank in terms of section 54 of the Banks Act, 1990 ("Banks Act");
2.6 the approvals of the necessary authorities in terms of section 37 of
the Banks Act, 1990 to the disposal which would result in Nedbank holding the
entire ordinary share capital of Imperial Bank; and
2.7 the conclusion of the addendum to the joint venture agreement entered
into between Imperial Bank and AMH on the 22 August 2006.
At the date of this announcement none of the conditions precedent have been
fulfilled. The disposal will be effective after the fulfilment of the last
condition precedent.
3. Settlement of the purchase consideration, election by Nedbank and
placement of shares
3.1 Settlement
Subject to 3.2.2, the purchase consideration will be settled in four
installments by Nedbank over a period of six months.
3.2 Elections by Nedbank
Nedbank may make elections in terms of which:
3.2.1 other than in respect of the first installment, Nedbank Group ordinary
shares, currently held as treasury shares by a subsidiary of Nedbank Group
("treasury shares") equal in value of up to 80% of the value of each
installment, will be acquired by Imperial. The value of the treasury shares
so acquired will be determined by using a predetermined formula based on the
average market prices at each installment date. Imperial will acquire 80% in
value of the first installment in treasury shares; and
3.2.2 Nedbank can early settle in cash and/or treasury shares which will be
placed on behalf of Imperial.
Imperial intends over a period of time to dispose of any Nedbank Group shares
to be received.
4. Agreement with Nedbank and Imperial Bank
4.1 Imperial Bank has historically funded motor vehicle transactions
introduced by members of the Imperial Holdings group of dealerships
("Imperial dealerships") through the Motor Finance Corporation ("MFC")
division of Imperial Bank;
4.2 Within MFC, the Imperial dealerships originate approximately 30 000
loans for new and used vehicles each year;
4.3 Imperial Bank, Nedbank, Associated Motor Holdings (Proprietary) Limited
("AMH") and Imperial Holdings have entered into an agreement which will
become effective when the disposal becomes unconditional and subject to the
necessary regulatory approval, in terms of which:
4.3.1 Imperial Bank will create a new specialist sub-division within MFC
which will be dedicated to servicing Imperial dealerships ("the Division")
although the dealerships will deal with the division on a non exclusive
basis;
4.3.2 Imperial Holdings and AMH shall, collectively participate in 50% of
the profits and losses of the Division, in respect of vehicle asset funding
introduced by Imperial dealerships to the Division;
4.4 Formal channels of communication will be established to ensure that the
Division benefits from the combined market knowledge, experience and
infrastructure that exist within both the Nedbank and Imperial Holdings
group.
5. 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.
6. Pro forma financial effects
The pro forma financial effects of the transaction on Imperial`s earnings and
headline earnings per share for the year ended 30 June 2009 and its net asset
value and tangible net asset value per share at that date are not significant
(being less than 3% in accordance with the definition contained in the
Listings Requirements).
7. Withdrawal of cautionary announcement
Pursuant to this announcement, the cautionary announcement published on 29
May 2009 and renewed on 13 July 2009 and 25 August 2009 is withdrawn.
Company Secretary
RA Venter
Bedfordview
16 September 2009
Independent Sponsor to Imperial
Merrill Lynch South Africa (Pty) Limited
Attorneys
Tugendhaft Wapnick Banchetti and Partners
Date: 16/09/2009 16:12:03 Produced by the JSE SENS Department.
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