| Thu 11 Feb 2010, 13:43 | | DLV - Dorbyl Limited - Update On The Disposal By Guestro Steering Gears |
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DLV
DLV
DLV - Dorbyl Limited - Update On The Disposal By Guestro Steering Gears
(Proprietary) Limited, A Wholly Owned Subsidiary Of Dorbyl, Of The Assets And
Liabilities Of Its Operation Referred To As Guestro Forging And Machining
DORBYL LIMITED
(Incorporated in the Republic of SA)
(Registration Number 1911/001510/06)
(Share Code: DLV ISIN: ZAE 000002184)
("Dorbyl" or "the Group")
UPDATE ON THE DISPOSAL BY GUESTRO STEERING GEARS (PROPRIETARY) LIMITED, A
WHOLLY OWNED SUBSIDIARY OF DORBYL, OF THE ASSETS AND LIABILITIES OF ITS
OPERATION REFERRED TO AS GUESTRO FORGING AND MACHINING
1. THE F&M DISPOSAL
1.1 As announced on SENS and in the press on 2 September 2009 ("the previous
Announcement"), Guestro Steering Gears (Proprietary) Limited ("GSG"), a
wholly owned subsidiary of Dorbyl, has entered into an agreement whereby
it will dispose of the assets and liabilities of its business referred to
as Guestro Forging and Machining ("F&M") to Specialised Precision
Investments (Proprietary) Limited ("the Purchaser") ("the F&M disposal").
1.2 This announcement serves to update shareholders regarding recent
developments regarding the F&M disposal and to set out pro forma
financial effects of the F&M disposal on Dorbyl.
1.3 Dorbyl and the Purchaser have entered into further addenda to the
agreement that regulate the F&M disposal ("the agreement"), amending the
agreement as follows:
1.3.1 the condition precedent regarding the approval of the F&M
disposal by shareholders, if applicable, was replaced by a
resolutive condition on the same terms. For the purposes of
clarity, it is recorded that such shareholder approval will not
be required as more fully explained in paragraph 1.7 below; and
1.3.2 the maximum disposal consideration in terms of the F&M disposal
was capped at R34,2 million.
1.4 Shareholders are hereby advised that all conditions to the F&M disposal
have now been met, save for the Purchaser furnishing adequate financial
guarantees for the disposal consideration to Dorbyl. Dorbyl is of the
opinion that same is imminent, and will advice shareholders as and when
such condition has been fulfilled.
1.5 The effective date of the F&M disposal has now been determined, namely 1
February 2010.
1.6 The JSE Limited ("JSE") has subsequently ruled that the F&M disposal does
not constitute a "related party" transaction in terms of section 10 of
the Listings Requirements of the JSE ("Listings Requirements") and thus a
fairness opinion is not required.
1.7 Due to a maximum disposal consideration of the F&M disposal being capped
in terms of the agreement, the F&M disposal is categorised as a Category
2 transaction in terms of the Listings Requirements. Shareholders are
accordingly advised that the F&M disposal will not require that a
circular be sent to shareholders nor that shareholder approval be
obtained for the F&M disposal, as had been stated in the previous
Announcement.
1.8 As the disposal consideration will only be received on fulfilment of the
outstanding condition as set out in paragraph 1.4 above, the Dorbyl board
of directors will determine, depending on the needs of Dorbyl, the
optimum utilisation of the proceeds at such time.
2. FINANCIAL EFFECTS
2.1 The unaudited pro forma financial effects on Dorbyl, before and after the
F&M disposal, as set out in the table below, are the responsibility of
the Group`s directors, and have been prepared for illustrative purposes
only to show how the F&M disposal may have affected Dorbyl`s results for
the 6 months ended 30 September 2009.
2.2 The unaudited pro forma financial effects, which due to their nature, may
not fairly reflect Dorbyl`s financial performance and position after the
disposal, are based on the assumptions that:
- for purposes of the earnings per share and headline earnings per
share calculation (basic and diluted), the disposal was effective 1
April 2009; and
- for purposes of the net asset value and net tangible asset value per
share calculations, the disposal was affected on 30 September 2009.
Unaudited(1) Pro forma
Before After(4)( Change
(cents) 5) (%)
(cents)
Loss per share(2) (83,3) (79,7) 4,3
Headline loss per share(2) (107,0) (80,4) 24,9
Net asset value per share(3) 660 637 (3,5)
Tangible net asset value per 660 637 (3,5)
share(3)
Notes:
1) extracted from the unaudited interim financial statements
of Dorbyl for the six months ended 30 September 2009;
2) based on a weighted average of 33,924 million shares in
issue during the interim period ended 30 September 2009;
3) based on 33,924 million shares in issue at 30 September
2009;
4) the "After" pro forma financial information reflects the
exclusion of a net loss after tax of R8.0 million on
F&M`s operations, the inclusion of a loss on disposal of
business of R7,8 million, interest received on the
disposal consideration calculated at 6.5% per annum; and
5) it was assumed that the disposal will not have an effect
on taxation due to the Group having an assessed loss.
3. RENEWAL OF CAUTIONARY ANNOUNCEMENT
Shareholders are referred to the previous cautionary announcements, the
last of which was dated 21 January 2010, and are advised that
negotiations are still in progress which, if successfully concluded, may
have an effect on the price of Dorbyl`s securities. Accordingly,
shareholders are advised to continue to exercise caution when dealing in
the Dorbyl`s securities until a further announcement is made.
Johannesburg
11 February 2010
Sponsor: PSG Capital (Pty) Limited
Date: 11/02/2010 13:43:07 Produced by the JSE SENS Department.
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