| Thu 15 Apr 2010, 12:00 | | TPC - Transpaco Limited - Acquisition of DISAKI Cores and Tubes (PTY) LTD from |
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TPC
TPC
TPC - Transpaco Limited - Acquisition of DISAKI Cores and Tubes (PTY) LTD from
Nampak Products Limited and withdrawal of cautionary
TRANSPACO LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1951/000799/06)
Share code: TPC & ISIN: ZAE000007480
("Transpaco")
ACQUISITION OF DISAKI CORES AND TUBES (PTY) LTD FROM NAMPAK PRODUCTS LIMITED AND
WITHDRAWAL OF CAUTIONARY
1. INTRODUCTION
Further to the cautionary announcement dated 12 March 2010, Investec Bank
Limited is authorised to announce that agreement has been reached between
Transpaco and Nampak Products Limited ("Nampak") pursuant to which
Transpaco will acquire all the issued shares in and claims on loan account
against Disaki Cores and Tubes (Proprietary) Limited ("Disaki"), from
Nampak, for a total purchase price of approximately R30 000 000.00
("Acquisition"). Disaki operates in the cardboard tubes and cores and
related products market. The Acquisition remains subject to the fulfilment
(or waiver, where applicable) of certain suspensive conditions as set out
below ("Suspensive Conditions"). Simultaneously with the implementation of
the Acquisition, Disaki will acquire Nampak`s Cleveland Packaging and
Global Packaging businesses with the result that on conclusion of the
Acquisition, Transpaco will become the owner of these additional two
businesses.
2. NATURE OF THE ACQUISITION
The business of Disaki (as well as the Cleveland Packaging and Global
Packaging businesses referred to above) is involved in, inter alia, the
manufacturing, marketing and distribution of board and paper based
angleboard, cores and tubes, cones, dividers, dufaylite, paper slitting and
yarn carriers. The aforesaid businesses are conducted from properties
situated in the Western Cape, Gauteng and Kwa-Zulu Natal.
3. RATIONALE FOR THE ACQUISITION
Transpaco manufactures and distributes certain complementary ranges of
cores and tubes with synergies presenting opportunity for growth and the
benefits of economies of scale. Transpaco believes that the Acquisition
will be value enhancing to shareholders by:
3.1 enabling Transpaco to grow its market share;
3.2 giving Transpaco a manufacturing and distribution presence in the
Western Cape and Kwa-Zulu Natal;
3.3 enabling Transpaco to increase production capacity to satisfy demand;
and
3.4 enabling Transpaco to increase its range of products and diversify
market focus and revenue streams. Transpaco does not currently operate
in the cones, dividers, dufaylite, paper slitting and yarn carrier
markets.
4. SALIENT TERMS
4.1 Purchase consideration
The purchase consideration for the shares in and claims against Disaki
will be approximately R30 000 000.00, which will be settled in four
monthly tranches, the first of which shall be paid to Nampak on the
Closing Date as referred to below.
4.2 Warranties and indemnities
Nampak has given Transpaco such warranties and indemnities in respect
of the Acquisition as are usually given with regard to transactions of
this nature.
4.3 Effective date
The Acquisition will be effective from the Closing Date, being the
20th (twentieth) business day following the fulfilment of the last
Suspensive Condition unless such business day is not the first
business day of a calendar month, in which case the Closing Date shall
be the first business day of the following calendar month.
4.4 Financing of the Acquisition
Transpaco will finance the Acquisition out of available resources.
(Drafting Note: Please note that the numbering in clause 4 has been
corrected but not marked-up. Please ensure it remains corrected in the
final draft)
5. UNAUDITED PRO FORMA FINANCIAL EFFECTS OF THE ACQUISITION
The unaudited pro forma financial effects set out below have been prepared
for illustrative purposes only to assist Transpaco shareholders in
assessing the impact of the Acquisition on the net asset value per share
("NAV"), net tangible asset value per share ("NTAV"), earnings per share
("EPS`) and headline earnings per share ("HEPS") of Transpaco. The
unaudited pro forma financial effects have been prepared for the six months
ended 31 December 2009 and are based on unaudited figures for this period.
These unaudited pro forma financial effects have been disclosed in terms of
JSE Limited ("JSE") Listings Requirements and because of their nature may
not fairly present Transpaco`s financial position, changes in equity,
results of operations or cash flows. The unaudited pro forma EPS and HEPS
figures reflect only Disaki`s historical performance prior to the
Acquisition, with no bearing on its future performance as part of the
Transpaco Group. (Drafting Note: Is reference to Disaki meant to include
the Cleveland and Global businesses?)
The unaudited pro forma financial effects are the responsibility of the
directors of Transpaco and are provided for illustrative purposes only.
Unaudited
Unaudited pro forma
Before the After the
Acquisition Acquisition Change
Cents Cents %
NAV 730 730 0
NTAV 718 683 (4.87)
EPS 124.9 109.1 (12.65)
HEPS 124.6 108.8 (12.68)
Notes:
5.1 The pro forma financial effects set out above have been prepared on
the assumption that the Acquisition became effective on 1 July 2009
for income statement purposes and on 31 December 2009 for balance
sheet purposes.
5.2 The EPS and HEPS , as set out in the "Before the Acquisition" column
of the table, are based on the unaudited results of Transpaco for the
six months ended 31 December 2009 and 28 131 000 weighted number of
ordinary shares in issue.
5.3 The EPS and HEPS, as set out in the "After the Acquisition" column of
the table, are based on the combined unaudited results of Transpaco
and Disaki for six months ended 31 December 2009; 28 131 000 weighted
average number of shares in issue; and the assumption that the
consideration was paid from 1 July 2009. (Drafting Note: Is reference
to Disaki meant to include the Cleveland and Global businesses?)
5.4 The NAV and NTAV per share as set out in the "Before the Acquisition"
column of the table are based on the unaudited balance sheet of
Transpaco at 31 December 2009 and 28 145 000 weighted number of
ordinary shares in issue.
5.5 The NAV and NTAV per share as set out in the "After the Acquisition"
column of the table are based on the combined unaudited balance sheets
of Transpaco and the value of Disaki being acquired at 31 December
2009 and 28 145 000 weighted number of ordinary shares in issue. .
(Drafting Note: Is reference to Disaki meant to include the Cleveland
and Global businesses?)
6. SUSPENSIVE CONDITIONS TO THE ACQUISITION
The Acquisition is subject, inter alia, to the fulfilment of the following
suspensive conditions, namely that -
6.1 the Acquisition is unconditionally approved (or approved subject to
conditions acceptable to Transpaco and Nampak) by the Competition
Authorities in terms of the Competition Act No. 89 of 1998;
6.2 Transpaco conducts and concludes to its satisfaction a due diligence
investigation of Disaki; and
6.3 The Transpaco board approves the Acquisition.
7. CATEGORISATION OF THE ACQUISITION AND WITHDRAWAL OF CAUTIONARY
The Acquisition is a Category 2 transaction in terms of section 9.5(a) of
the JSE Listings Requirements. The cautionary announcement released on SENS
on Friday, 12 March 2010 and published in the press on Monday, 15 March
2010 is hereby withdrawn. Accordingly, Transpaco shareholders are no
longer required to exercise caution when dealing in Transpaco shares.
Johannesburg
15 April 2010
Investment Bank and Sponsor: Investec Bank Limited
Legal Advisors to Transpaco: Edward Nathan Sonnenbergs Inc
Date: 15/04/2010 12:00:01 Produced by the JSE SENS Department.
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