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Wooltru Limited - Update On The Payment To Shareholders Withdrawal Of Cautionary
Announcement
WOOLTRU LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1936/008278/06)
Share code: WLO ISIN: ZAE000007993
Share code: WLP1 ISIN: ZAE000008017
Share code: WLN ISIN: ZAE000008744
Share code: WLOP ISIN: ZAE000008009
("Wooltru")
UPDATE ON THE PAYMENT TO SHAREHOLDERS WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT
1. BACKGROUND
Shareholders are referred to the announcements dated 24 October 2005 and \
11 November 2005, notifying them of Wooltru"s intention to distribute to
ordinary and "N" ordinary shareholders 35 cents per ordinary and "N" ordinary
share in cash as a distribution out of share premium ("the payment to
shareholders"). The payment to shareholders was approved by the requisite
majority of shareholders at a general meeting held on 11 November 2005. Such
payment also required the approval of the directors of Wooltru in terms of the
resolution of shareholders.
On 24 November 2005, and prior to any directors" approval of the payment to
shareholders, Wooltru was served with an urgent application by Johnnic Book
Retail Limited ("the claimant") requesting an interdict to prevent the payment
to shareholders. The application was resolved by way of the issue of a guarantee
by Wooltru as more fully explained in paragraph 2 below.
2. PAYMENT TO SHAREHOLDERS
By way of background, in the Chairman"s Review contained in Wooltru"s Annual
Report for the year ended 30 June 2005, shareholders were reminded of the status
of certain medical aid claims: "In regard to the claims by former employees of
the business of Central News Agencies Limited ("CNA") regarding post-retirement
medical aid contributions, it has been held that Wooltru is liable for any
claims, which may be proved against Johnnic Book Retail Limited ("Johnnic")
(formerly CNA Gallo Limited) by erstwhile employees of the business of CNA, as
at 1 September 1997. However there is uncertainty regarding the success of any
claims against Johnnic and consequently the liability of Wooltru."
In order to proceed with the payment to shareholders, and following the Court
application by Johnnic, Wooltru has provided the claimant with a guarantee in
the amount of R20.9 million. Accordingly, the directors of Wooltru have resolved
to distribute 33 cents per ordinary share and "N" ordinary share out of share
premium, as approved by shareholders. Such payment to shareholders is considered
by the directors to be prudent and will result in the company retaining cash of
R55.5 million.
Note: The payment to shareholders of 33 cents per share out of share premium
will be treated as follows for purposes of the Income Tax Act, 1962 (Act 62 of
1958):
* 13.676 cents per share represents amounts previously transferred from
Wooltru"s distributable reserves to its share premium and will be classified as
a dividend in the hands of the shareholder; and
* 19.324 cents per share will be classified as a capital repayment in the hands
of the shareholder.
3. REVISED SALIENT DATES
Set out in the table below are the salient dates pertaining to the payment to
shareholders:
2005
Last day to trade in order to qualify for the payment
to shareholders on Thursday, 22 December
Shares trade "ex" the entitlement to the payment
to shareholders from Friday, 23 December
The record date for the payment to shareholders on Friday, 30 December
2006
Date of payment on Tuesday, 3 January
Share certificate may not be dematerialised or rematerialised between Friday,
23 December 2005 and Friday, 30 December 2005, both days inclusive.
4. WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT
As the directors have resolved to distribute 33 cents per ordinary and "N"
ordinary share, shareholders are no longer required to exercise caution when
dealing in their Wooltru shares.
Cape Town
7 December 2005
Sponsor
BRIDGE CAPITAL
Date: 07/12/2005 12:26:16 PM Produced by the JSE SENS Department
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