| Tue 22 Sep 2009, 13:23 | | SKW - Skinwell Holdings Limited - Disposal and further cautionary |
|
SKW
SKW
SKW - Skinwell Holdings Limited - Disposal and further cautionary
announcement
SKINWELL HOLDINGS LIMITED
(formerly Placecol Holdings Limited)
(Incorporated in the Republic of South Africa)
(Registration number 2003/025374/06)
JSE code: SKW
ISIN: ZAE000135893
("Skinwell" or "the company")
DISPOSAL OF THE PLACECOL BEAUTY INSTITUTE, A DIVISION OF PLACECOL
COSMETICS (PROPRIETARY) LIMITED AS A GOING CONCERN TO CENTURION
ACADEMY (PROPRETIARY) LIMITED AND FURTHER CAUTIONARY ANNOUNCEMENT
1. INTRODUCTION
Shareholders are advised that an agreement has been entered into
between Placecol Cosmetics (Proprietary) Limited ("Cosmetics"), a
wholly owned subsidiary of Skinwell, and Pacific Breeze 189 (Pty)
Limited, a company within the Centurion Academy (Proprietary)
Limited group ("Centurion Academy"), in terms of which Centurion
Academy will purchase the Placecol Beauty Institute (a division
of Cosmetics), as a going concern, for an amount of R700 000
("the transaction").
2. BACKGROUND INFORMATION
Cosmetics carries on the business of a marketer, distributor,
retailer and provider of skin and health care products and
services and is a franchisor of the Placecol and DNB brand beauty
products and services and a trainer of beauty therapists and
franchisees.
3. RATIONALE FOR THE DISPOSAL
The directors of Skinwell have taken a strategic decision to
focus the company on its core activities, i.e. franchisor,
retailer and service provider of its own branded products, and no
longer considers that the Beauty Institute is core to its
activities. The Skinwell group will continue to provide in-house
training to its franchisees.
4. DISPOSAL CONSIDERATION
The disposal consideration is payable in cash on or before 15
September 2009. A further amount of R20 000 per student, over
and above the first 60 Placecol first year students for 2010, is
payable on or before 25 February 2010. Based on current
available information, it is not expected that more than 80
Placecol first year students will enrol for 2010.
5. EFFECTIVE DATE
The transaction will become effective on 1 September 2009.
6. SUSPENSIVE CONDITIONS
There are no outstanding suspensive conditions to the
transaction.
7. FINANCIAL EFFECTS OF THE DISPOSAL
No financial effects are presented as they are not significant,
being below 3%.
8. APPLICATION OF THE PROCEEDS OF THE DISPOSAL
The proceeds of the disposal will be employed towards the ongoing
funding of the capital requirements of the group and the growth
of its brands and core operations.
9. CLASSIFICATION OF THE TRANSACTION
Mr. Theo Schoeman, an independent non-executive director of
Skinwell, is the owner of Centurion Academy, however, in terms of
paragraph 21.11(a) of the Listings Requirements of the JSE
Limited the transaction is not regarded as a "related party
transaction" due to the size of the transaction.
10. FURTHER CAUTIONARY ANNOUNCEMENT
Shareholders are advised that Skinwell has entered into further
negotiations, which if successfully concluded, may have an effect
on the price of its securities. Accordingly, shareholders are
advised to continue to exercise caution when dealing in the
company`s securities until a further announcement is made.
Midrand
22 September 2009
Lead Designated Adviser
Grindrod Bank Limited
Corporate Adviser and Designated Adviser
Vunani Corporate Finance
Date: 22/09/2009 13:23:02 Produced by the JSE SENS Department.
The SENS service is an information dissemination service administered by the
JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or
implicitly, represent, warrant or in any way guarantee the truth, accuracy or
completeness of the information published on SENS. The JSE, their officers,
employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature,
howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
