| Fri 27 Aug 2010, 14:43 | | DLV - Dorbyl Limited - Disposals by Dorbyl and withdrawal of |
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DLV
DLV
DLV - Dorbyl Limited - Disposals by Dorbyl and withdrawal of
cautionary announcement
DORBYL LIMITED
(Incorporated in the Republic of South Africa)
(Registration Number: 1911/001510/06)
(Share Code: DLV ISIN: ZAE000002184)
("Dorbyl" or "the Company" or "the Group")
DISPOSAL BY DORBYL OF
A. THE ASSETS AND LIABILITIES OF ITS DORBYL AUTOMOTIVE SYSTEMS
DIVISION ("DAS DISPOSAL"); AND
B. ITS 50% INTEREST IN DORBYL MAGNETTO WHEELS (PROPRIETARY)
LIMITED ("DMW") ("DMW DISPOSAL");
AND WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT
A. DAS DISPOSAL
1. INTRODUCTION
1.1 Further to the previously released renewals of the
cautionary announcement, the last of which was dated 29
July 2010 ("the cautionary announcement"), shareholders
are hereby advised that Dorbyl has entered into an
agreement dated 27 august 2010 ("the signature date") in
terms of which it will dispose of the assets and
liabilities of its Dorbyl automotive systems division
("DAS") to forest dawn properties (proprietary) limited
("the purchaser"), with effect from 1 April 2010 ("the
effective date").
1.2 The DAS disposal and the implementation thereof are
subject to the fulfilment of the resolutive condition
precedent as detailed in 5 below.
2. RATIONALE FOR THE DAS DISPOSAL
As announced on SENS and in the press on 22 and 23 January 2010
respectively, the DAS disposal, which had initially been announced
on 20 October 2008, was terminated due to the non-fulfilment of
certain conditions precedent by the proposed purchaser at that
time. However, as detailed in the announcement of the Group`s
Provisional Results for the year ended 31 March 2010 released on
SENS and published in the press on 17 and 18 June 2010 respectively
("the Provisional Group Results announcement"), negotiations with a
new potential buyer were at an advanced stage. The rationale for
the DAS disposal remains the same as was stated in the
aforementioned announcements, namely that the Group was overly
reliant on the automotive industry and the inherent exposures and
risks in that industry as to global competition, pricing, input
costs and capital expenditure necessary to keep up with technology.
3. CONSIDERATION AND APPLICATION OF CONSIDERATION
3.1. The consideration in respect of the DAS disposal will be R24
million, including the value of the net working capital as at
the effective date as certified by the auditors of Dorbyl,
resulting in the aggregate consideration not exceeding R31
million ("the disposal consideration").
3.2 The disposal consideration will be settled in cash upon the
fulfilment of the resolutive condition precedent as detailed
in 5 below.
3.3 As the disposal consideration will only be received once the
resolutive condition precedent, as detailed in 5 below, is
fulfilled, the Board of Directors will determine, depending on
the needs of Dorbyl, the optimum utilisation of the proceeds
at such time.
4. FINANCIAL EFFECTS
The table below sets out the unaudited pro forma financial effects
on dorbyl before and after the das disposal and are the
responsibility of the company`s directors and have been prepared
for illustrative purposes only to show how the das disposal may
have affected Dorbyl`s results for the year ended 31 march 2010,
based on the assumptions that:
For purposes of the earnings and headline earnings per share
calculations, the das disposal was effective from 1 april 2009; and
for purposes of the net asset value and net tangible asset value
per share calculations, the das disposal was effected on 31 march
2010.
It should be noted that the unaudited pro forma financial effects
have been prepared on Dorbyl`s latest results for the year ended 31
march 2010, taking into consideration the das disposal and because
of their nature, may not fairly reflect Dorbyl`s financial
performance and position after the das disposal.
Audited(1) Pro forma Change
Before After (%)
(cents) (cents)
Loss per share(2) 279,6 222,8 20,3
Headline loss per share(2) 220,7 190,8 13,5
Net asset value per share(3) 487,0 489,0 0,4
Tangible net asset value per 487,0 489,0 0,4
share(4)
Notes
1. Extracted from the published audited consolidated Provisional
Group Results of Dorbyl for the year ended 31 March 2010.
2. Adjustments to reflect the once-off effects of the DAS
disposal, namely: disposal consideration of R24 million,
interest earned at an after-tax return of 6% totalling R1,4
million for the financial year ended 31 March 2010 and
transaction costs of R90 000.
3. Calculation based on a weighted average of 33 924 million
shares in issue during the financial year ended 31 March 2010.
4. Calculation based on 33 924 million shares in issue at 31
March 2010.
5. RESOLUTIVE CONDITION PRECEDENT
The DAS disposal is subject to, inter alia, the following
resolutive condition which is still to be fulfilled:
the registration by the purchaser of a rebate store in the name of
the purchaser.
6. CATEGORISATION
In terms of the Listings Requirements of the JSE Limited the DAS
disposal is deemed to be a Category 2 transaction and therefore
does not require shareholder approval.
B. VOLUNTARY ANNOUNCEMENT OF DMW DISPOSAL
Following the reference made to the imminent DMW disposal in the
provisional group results announcement, shareholders are hereby
advised that Dorbyl has concluded an agreement dated 30 july 2010
in terms of which it will dispose of it`s 50% interest in DMW to
the joint venture partner, MW Italia S.p.A., for a consideration of
Euro600 000.
The DMW disposal and the implementation thereof are subject to the
approval by the competition authorities.
C. WITHDRAWAL OF CAUTIONARY
Further to the cautionary announcement, shareholders are advised
that, in light of the above, the cautionary is herewith withdrawn.
Johannesburg
27 August 2010
Sponsor: PSG Capital (Proprietary) Limited
Date: 27/08/2010 14:43:12 Produced by the JSE SENS Department.
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