| Thu 10 Dec 2009, 11:24 | | AGI - A G Industries Limited - Disposal Of Africa Glass International |
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AGI
AGI
AGI - A G Industries Limited - Disposal Of Africa Glass International
Holdings Inc ("International Holdings") And Disposal Of The Sheerline
Business Financial Effects Renewal Of Cautionary Announcement
A G INDUSTRIES LIMITED
(INCORPORATED IN THE REPUBLIC OF SOUTH AFRICA)
REGISTRATION NUMBER: 1980/004051/06
SHARE CODE: AGI
ISIN: ZAE000039467
("AGI" OR "THE COMPANY")
1. INTRODUCTION
Shareholders are referred to the announcement on 3 September 2009 that
AGI had, through its wholly owned subsidiary AGI Solutions, entered into
an agreement to dispose of its business being carried on under the trade
name Sheerline, together with the business carried on under the name
Solutions Department (collectively "Sheerline"), for a cash price that
will be a maximum of R50 000 000 and a minimum of R45 000 000 to
Wispeco, a wholly owned subsidiary of Wispeco Holdings, which in turn
is controlled by Remgro ("the Sheerline disposal"). Shareholders are
further referred to the announcement on 30 September 2009 that AGI had
entered into an agreement to dispose of its wholly owned subsidiary
International Holdings for a cash price of US$3.5 million to Oriole
Glass ("the International Holdings disposal").
The transactions are, inter alia, subject to the approval of AGI
shareholders in general meeting.
2. FINANCIAL EFFECTS
The table below sets out the unaudited pro forma financial effects of
each of the Sheerline disposal, the International Holdings disposal and
collectively the transactions on AGI. The unaudited pro forma financial
effects are presented for illustrative purposes only and because of
their nature may not give a fair reflection of AGI`s results, financial
position and changes in equity after each of the Sheerline disposal and
the International Holdings disposal, and collectively the transactions.
It has been assumed for purposes of the pro forma financial effects that
the transactions took place with effect from 1 July 2008 for income
statement purposes and 30 June 2009 for balance sheet purposes. The
directors of AGI are responsible for the preparation of the unaudited
pro forma financial effects.
Before 1 After the After the After the % Change
Sheerline International transactions
disposal Group
disposal
Published Pro forma Pro forma Pro forma
Basic loss (145,6)2 (138,4) 3 (146,8) 4 (139,6) 4,1%
per
ordinary
share
(cents)
Headline (72,8) 2 (64,0) 3 (72,8) 4 (64,0) 12,1%
loss per
ordinary
share
(cents)
Net asset 40,7 40,57 40,27 40,0 7 (1,7%)
value per
ordinary
share
(cents)
Net 22,2 21,87 21,57 21,3 7 (4,5%)
tangible
asset value
per
ordinary
share
(cents)
Number of 205 626 205 626 205 626 205 626 -
shares in
issue
(`000)
Weighted 204 261 204 261 204 261 204 261 -
average
number of
shares in
issue
(`000)
Notes:
1. The "Before" financial information is based on AGI`s published
reviewed results for the year ended 30 June 2009.
2. Included in the "before" financial information is an anticipated
loss on the disposals of Sheerline and the International Group of
R12 084 406.
3. The "after the Sheerline disposal" has been calculated after the
reversal of the Sheerline trading for the 2009 financial year
applicable to the assets and liabilities being sold, the pro forma
interest saving, adjusted for the deferred consideration, based on
the expected sale proceeds and an average overdraft rate for the
2009 financial year of 11,5% and the pro forma loss on disposal of
Sheerline of R3 266 573 had the sale taken place on 1 July 2008 due
to the difference in value of net assets disposed of at that date.
4. The "after the International Group disposal" has been calculated
after the reversal of the International Group`s trading for the
2009 financial year, adjusted for the reversal of the goodwill
impairment in International Group of R20 405 136, the pro forma
interest saving based on the expected sale proceeds and an average
overdraft rate for the 2009 financial year of 11,5% and the pro
forma loss on disposal of the International Group of R2 250 895 had
the sale taken place on 1 July 2008, due to the difference in the
net tangible asset value at that date.
5. No adjustment for taxation has been made as the AGI Group incurred
a loss before taxation for the year and did not raise any deferred
taxation assets as a result of the uncertainty surrounding the
future recoverability of those deferred taxation assets.
6. With the exception of the future interest benefit, which is
expected to have a continuing effect on the AGI Group, all other
adjustments are once off adjustments.
7. The adjustments to net asset and net tangible asset value per
ordinary share relate to the expected transaction costs of R1 486
470, assuming that the transaction had taken place on 30 June 2009.
8. No additional losses are expected on the disposal of Sheerline and
the International Group at the effective date other than those
already accounted for in the "for the year ended 30 June 2009"
balances.
3. DOCUMENTATION
A circular containing the details of the transactions and including a
notice convening a general meeting of AGI shareholders at 11:00 on
Monday, 28 December 2009 at the registered offices of the company being
the corner of Kruger Street and Mimetes Road, Denver, Extension 11,
Johannesburg, for the purpose of approving the transactions, was posted
to shareholders on 10 December 2009.
4. RENEWAL OF CAUTIONARY ANNOUNCEMENT
Shareholders are referred to the announcement dated 3 December 2009
detailing the restructure and proposed rights offer of the company and
are advised to continue to exercise caution in trading in their AGI
shares, until the salient terms, dates and financial effects of the
rights offer are announced.
Johannesburg
10 December 2009
Sponsor
Sasfin Capital
A division of Sasfin Bank Limited
Corporate Adviser
Favim Investments
Independent Expert
PKF Corporate Finance (JHB) (Proprietary) Limited
Legal Adviser
HR Levin
Attorneys, Notaries and Conveyancers
Reporting Accountants
Deloitte & Touche
Date: 10/12/2009 11:24:02 Produced by the JSE SENS Department.
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