| Tue 12 Oct 2010, 10:12 | | MMG - MICROmega Holdings Limited - Acquisition of GIM Holdings (Proprietary) |
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MMG
MMG
MMG - MICROmega Holdings Limited - Acquisition of GIM Holdings (Proprietary)
Limited ("GIM Holdings")
MICROmega HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1998/003821/06)
(Share code: MMG ISIN: ZAE000034435)
("MICROmega" or "the group")
ACQUISITION OF GIM HOLDINGS (PROPRIETARY) LIMITED ("GIM Holdings")
1. INTRODUCTION
MICROmega shareholders are advised that MICROmega has entered into an agreement
with Ian Gregory Morris ("Vendor") to acquire 86% of the issued share capital of
GIM Holdings , with effect from 15 October 2010, for a total consideration of R7
240 000 as detailed in paragraph 4 ("the Acquisition") below. The Vendor will
retain a 14% interest in GIM Holdings and a lease agreement for the next 12
months has been signed with the Vendor at a rental of R60 000 per month ("the
Rental").
2. NATURE OF BUSINESS OF GIM HOLDINGS
GIM Holdings is a property investment company with an investment property
consisting of a residential abode situated on Erf 278, Hyde Park Ext 47. The
total property size is around 3 600 square Metres.
3. RATIONALE FOR THE ACQUISITION
The group see development in this area in the future adding better than average
returns to shareholders. Similar development has occurred within the suburb and
has been successful.
4. TERMS OF THE ACQUISITION
4.1 Acquisition, consideration and settlement terms The acquisition
consideration of R7 240 000 million will be settled as follows:
4.1.1 First payment
- R7 240 000 in cash will be paid to the Vendor of GIM
Holdings on the closing date of the agreement.
A monthly rental of R60 000 has been secured from the Vendor whilst the group
commences with the development plans for the property.
5. CONDITIONS PRECEDENT
The implementation of the acquisition is subject to the Vendor writing off all
and any claims against the company and retaining all obligations of settlement
of any financing structures used to fund the deal, limited to the amount owed to
third parties on the closing date of the transaction.
We confirm that all conditions precedent have been fulfilled.
6. FINANCIAL EFFECTS OF THE ACQUISITION
The table below shows the per share effect of the acquisition of GIM Holdings
for the six months ended 30 June 2010. The pro forma financial effects, which
are the responsibility of the directors of MICROmega, have been prepared for
illustrative purposes only and, because of their nature, may not fairly present
MICROmega`s financial position as at 30 June 2010, or the effect of future
earnings. The financial effects are determined in accordance with the Listing
Requirements of the JSE.
Notes Unaudited Pro forma Change
(%)
At At
30 June 30 June 2010
2010 After
GIM Holdings
Acquisition
Earnings per share (cents) 3 8.10 8.17 0.86
Headline earnings per share (cents)
4 7.66 7.72 0.83
Net asset value per share (cents)
5 288.42 288.42
Net tangible asset value per share 6 219.86 219.86
(cents)
Weighted average number of shares 7 96 953 96 953
Total number of shares in issue 7 96 948 96 948
Notes:
1.The figures in the "Audited" column are extracted from the
published unaudited abridged results of MICROmega for the
six months ended 30 June 2010.
2.The figures in the "After acquisition" column are adjusted
for the inclusion of the financial results as reflected
in the management accounts of GIM Holdings for the period
commencing 1 January 2010 and ending 30 June 2010.
3.Earnings per share calculations in the "After acquisition"
column are based on the following assumptions:
-The acquisition was effective 1 January 2010.
-The net profit after tax of GIM Holdings for the six months
ended 30 June 2010 was R58 851.
4.Headline earnings per share calculations in the "After
acquisition" column have been based on the following
assumptions:
-None of the earnings of GIM Holdings are to be excluded
for Headline Earnings calculations.
5.The net asset value is calculated on the assumption that GIM
Holdings` investment in residential property is fairly valued
at R9.5 million and GIM Holdings` net asset value is R8.38
million. The acquisition consideration is based on the net
asset value of GIM Holdings and no premium is payable.
6.The net intangible asset value is calculated on the
assumption that GIM Holdings` investment in residential
property is fairly valued at R9.5 million and GIM Holdings`
net asset value is R8.38 million. The acquisition
consideration is based on the net asset value of GIM Holdings
and no intangible assets arise based on the transaction.
7.The weighted average number of shares and the actual number
of shares in issue have not been changed as securities of the
company do not form part of the purchase consideration.
7. OTHER MATTERS
The articles of GIM Holdings will be amended to comply with the JSE`s Listing
Requirements.
8. RELATED PARTY TRANSACTION
Shareholders are advised that Ian Gregory Morris is the Executive Chairman of
MICROmega, and as such this is a related party transaction in terms of the JSE
Limited Listing Requirements.
This transaction is classified as a small related party transaction and thus the
provisions of 10.4 do not apply.
Paragraph 10.7 (b) has been complied with, and both the Acquisition and the
Rental have been declared to be fair by an independent professional expert,
namely Arcay Moela Sponsors (Proprietary) Limited and the fairness opinion has
been submitted to the JSE for review and approval. The fairness opinion will
lie for inspection at MICROmega`s registered office for a period of 28 days from
the date of announcement.
Sandton
12 October 2010
Transactional Sponsor
Arcay Moela Sponsors (Proprietary) Limited
Independent Professional Expert
Arcay Moela Sponsors (Proprietary) Limited
Date: 12/10/2010 10:12:22 Produced by the JSE SENS Department.
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