| Tue 28 Sep 2010, 13:54 | | AVI - AVI Limited - Payment to shareholders out of share premium |
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AVI
AVI
AVI - AVI Limited - Payment to shareholders out of share premium
AVI LIMITED
(Registration number 1944/017201/06)
Share code: AVI
ISIN: ZAE000049433
("AVI" or "the Group")
PAYMENT TO SHAREHOLDERS OUT OF SHARE PREMIUM
1. Introduction
The board of directors of AVI ("the board") is pleased to announce its
intention, subject to shareholders` approval, to make a specific payment to AVI
shareholders out of share premium to be effected in terms of Section 90 of the
Companies Act, 1973, as amended, or Section 46 of the Companies Act, 2008, as
amended, as the case may be ("the Act") ("the payment").
2. The payment
2.1 Rationale and terms
In view of the Company`s low balance sheet gearing and strong cash generating
characteristics, the board has proposed a special payment to shareholders, in
addition to the normal dividend, as an equitable and efficient way to return
capital to shareholders. The payment will be made in Rand, out of the Company`s
liquid assets. The Company`s balance sheet as at 30 June 2010 reflects that
there is sufficient share premium to effect a payment of R166,8 million, or 48,6
cents per ordinary share. If shareholders approve the ordinary resolution set
out as Resolution 17 in the Notice of AGM sent to shareholders on 28 September
2010, for the allotment of further shares to the AVI Executive Share Scheme
Trust, the share premium will increase by R95,2 million, which will allow a
further payment of up to R94,7 million or 26,4 cents per share out of share
premium (up to 75 cents in total). The effect of the payment on the Company`s
share premium in each of the situations described is set out in the table below:
Before the After the % change
transaction transaction
Assuming payment of 48,6
cents per share
Share premium (R`m) 166,8 0,0 (100,0)
Assuming payment of 75,0
cents per share
Share premium (R`m) 262,0 0,5 (99,8)
3. Pro forma financial effects
The accounting policies are those presented in the annual financial statements
for the year ended 30 June 2010 and have been applied consistently in
preparation of the unaudited pro forma financial effects. The directors are
responsible for the preparation of the unaudited pro forma financial effects.
Due to the nature of the unaudited pro forma financial effects, they may not
fairly present the Company`s financial position, changes in equity, and results
of operations or cash flows. The unaudited pro forma financial information is
merely intended to illustrate how the payment to shareholders out of share
premium, based on certain assumptions, might have affected the audited financial
statements of the Company. The tables below set out, for illustrative purposes
only, the unaudited pro forma financial effects of the payment on the earnings
per ordinary share, headline earnings per ordinary share, net asset value per
ordinary share and net tangible asset value per ordinary share based on the
Company`s audited financial results for the year ended 30 June 2010. It does not
purport to be indicative of what the financial results would have been had the
transaction been implemented on a different date.
Assuming payment of 48,6 Before the After the % change
cents per share transaction transaction
EPS (cents) 157,5 157,2 (0,2)
Fully diluted EPS (cents) 151,9 151,6 (0,2)
HEPS (cents) 183,6 183,3 (0,2)
Fully diluted HEPS (cents) 177,1 176,8 (0,2)
NAV per share (cents) 974,1 925,2 (5,0)
TNAV per share (cents) 667,5 618,7 (7,3)
Assuming payment of 75,0 Before the After the % change
cents per share transaction transaction
EPS (cents) 157,5 157,0 (0,3)
Fully diluted EPS (cents) 151,9 151,5 (0,3)
HEPS (cents) 183,6 183,1 (0,3)
Fully diluted HEPS (cents) 177,1 176,6 (0,3)
NAV per share (cents) 974,1 898,6 (7,8)
TNAV per share (cents) 667,5 592,1 (11,3)
Notes:
1. The "before the transaction" column is based on AVI`s published
audited financial statements for the year ended 30 June 2010.
2. The "after the transaction" earnings and headline earnings have been
adjusted for transaction costs (R0,15 million in respect of a 48,6
cent per share special payment and R0,2 million in respect of a 75
cent per share special payment) relating to the payment made to
shareholders out of share premium and capital gains tax assuming that
the transaction took effect on 1 July 2009.
3. The "after the transaction" net asset value and net tangible asset
value is based on the following assumptions:
a. The payment out of share premium took effect on 30 June 2010; and
b. Transaction costs of R0,15 million and R0,2 million in respect of
a 48,6 cent and 75 cent per share special payment respectively
have been accrued for in current liabilities at 30 June 2010.
4. The assumption has been made that the payment to shareholders out of
share premium will not have a secondary tax on companies effect but is
expected to have a small capital gains tax effect in the share
incentive trusts which hold AVI shares.
4. Condition precedent
In terms of the Listings Requirements of the JSE Limited, the Act and the
Company`s Articles of Association, the payment is subject to the passing of an
ordinary resolution by shareholders approving the payment as a specific
approval.
5. Salient dates and times
2010
Annual report posted to shareholders on Tuesday, 28 September
Forms of proxy to be received by 11:00 on Tuesday, 19 October
Annual general meeting to be held at or about 11:00 on Wednesday, 20 October
Results of the annual general meeting released
on SENS on Wednesday, 20 October
Results of the annual general meeting published
in the press on Thursday, 21 October
Last day to trade on the JSE in order to
receive the payment Friday, 5 November
First trading day ex-payment on the JSE Monday, 8 November
Record date* Friday, 12 November
Payment date Monday, 15 November
* Date on which at close of business shareholders must be recorded as such in
the register to receive the payment
These dates and times are subject to amendment. Any such amendment will be
released on SENS and published in the press.
AVI shares may not be dematerialised or rematerialised between Monday, 8
November 2010 and Friday, 12 November 2010, both days inclusive.
6. Annual General Meeting
Notice is hereby given that the annual general meeting of AVI shareholders to,
inter alia, approve the payment will be held at 11:00 on Wednesday, 20 October
2010 at the registered address of AVI, namely 2 Harries Road, Illovo,
Johannesburg. The notice of the annual general meeting, setting out the full
details of the proposed payment will be posted to shareholders on 28 September
2010.
Angus Band Simon Crutchley
Chairman Chief Executive
28 September 2010
Sponsor
Standard Bank
Date: 28/09/2010 13:54:03 Produced by the JSE SENS Department.
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