| Mon 29 Nov 2010, 17:15 | | MVG / MVGP - Mvelaphanda Group Limited - Mvela Group announces the successful |
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MVG MVGP
MVG
MVG / MVGP - Mvelaphanda Group Limited - Mvela Group announces the successful
placement of approximately 10.2 million of its ordinary shares in Health
Strategic Investments Limited
Mvelaphanda Group Limited
Registration Number: 1995/004153/06
(Incorporated in the Republic of South Africa)
Ordinary share code: MVG
ISIN: ZAE000060737
Preference share code: MVGP
ISIN: ZAE000073540
("Mvela Group" or "the Company")
MVELA GROUP ANNOUNCES THE SUCCESSFUL PLACEMENT OF APPROXIMATELY 10.2 MILLION OF
ITS ORDINARY SHARES IN HEALTH STRATEGIC INVESTMENTS LIMITED
Mvela Group is pleased to announce the completion of the sale by way of an
accelerated bookbuild of 10,239,686 Health Strategic Investments Limited
("Health") ordinary shares placed with qualifying institutional investors at a
price of ZAR14.00 per ordinary share (the "Equity Placing"). The Equity Placing
was oversubscribed, with demand from South African based investors only.
Following the Equity Placing, Mvela Group does not hold any ordinary shares in
Health. The Equity Placing was implemented on 23 November 2010.
The sale price represents a discount of approximately 3.0% to the previous
closing price of Life Healthcare shares of ZAR14.43 and a discount of
approximately 4.1% to the previous closing price of Health shares of ZAR14.60 on
17 November, 2010. Accordingly Mvela Group will receive gross proceeds of
ZAR143.3 million.
The business and principal activity of Health is to act as an investment holding
company for its only asset, its investment in Life Healthcare Group Holdings
Limited.
The sale of its stake in Health is part of Mvela Group`s overall strategy of
unbundling of its portfolio assets realizing value for its shareholders. The
proceeds from the sale will be used to pay down certain debt of portfolio
companies.
The table below sets out the unaudited pro forma financial effects of the Equity
Placing on Mvela Group`s attributable earnings per Mvela Group ordinary share,
headline earnings per Mvela Group ordinary share, fully diluted attributable
earnings per Mvela Group ordinary share and fully diluted headline earnings per
Mvela Group ordinary share for the financial year ended 30 June 2010, as well as
Mvela Group`s net asset value per Mvela Group ordinary share for the financial
year ended 30 June 2010 assuming that the Equity Placing was implemented.
These pro forma financial effects have been prepared for illustrative purposes
only and, because of their nature, may not fairly present the actual financial
effects on Mvela Group.
The directors of Mvela Group are responsible for the preparation of the pro
forma financial information.
Before Effects of Effect of
(cents) the the fair
Corporate value
Actions adjustment
(cents) of Health
shares
(cents)
Earnings per ordinary share 212.75 (2.66) 2.38
Headline earnings per ordinary 238.50 (201.70) 2.38
share
Diluted earnings per ordinary share 192.52 17.57 2.38
Diluted headline earnings per 215.05 (178.25) 2.38
ordinary share
NAV per ordinary share 1,015.08 (626.72) 2.38
TNAV per ordinary share 831.99 (483.47) 2.38
Diluted number of ordinary shares 465,484 62,115 -
in issue (`000)
Diluted weighted number of ordinary 465,307 62,115 -
shares in issue (`000)
Weighted number of ordinary shares 406,962 120,460 -
(`000)
Post Effect Post %
Corporate of the Corporate change
Actions Equity Actions, due to
and fair Placing fair value Equity
value (cents) adjustment Placing
adjustment and Equity
of Health placing
shares (cents)
(cents)
Earnings per ordinary share 212.47 (1.58) 210.89 -0.74%
Headline earnings per ordinary 39.18 (1.58) 37.60 -4.04%
share
Diluted earnings per ordinary share 212.47 (1.58) 210.89 -0.74%
Diluted headline earnings per 39.18 (1.58) 37.60 -4.04%
ordinary share
NAV per ordinary share 390.74 (1.72) 389.02 -0.44%
TNAV per ordinary share 350.90 (1.77) 349.13 -0.50%
Diluted number of ordinary shares 527,599 527,599
in issue (`000)
Diluted weighted number of ordinary 527,422 527,422
shares in issue (`000)
Weighted number of ordinary shares 527,422 527,422
(`000)
Notes and assumptions:
1 The Mvela Group financial information reflected in the "Before" column has
been extracted from the audited annual results of Mvela Group for the year
ended 30 June 2010.
2 The pro forma adjustments to the statement of comprehensive income have
been calculated on the assumption that the Corporate Actions, as set out in
note 4 below, the fair value adjustment of Health shares and Equity Placing
were implemented on 1 July 2009.
3 The pro forma adjustments to the statement of financial position have been
calculated on the assumption that the Corporate Actions, the fair value
adjustment of Health shares and Equity Placing were implemented on 30 June
2010.
4 The Corporate Actions relate to the following:
- the conversion of Mvela Group preference shares into Mvela Group
ordinary shares;
- the distribution by Mvela Group of 128 849 235 Health Strategic
Investments Limited shares;
- the proposed distribution by Mvela Group of 100% of the entire issued
ordinary share capital of Mvelaserve; and
- the restructuring by Mvela Group of its broad-based Black Economic
Empowerment ownership initiative.
5 The fair value adjustment of Health shares has been calculated as the
difference between the closing price of Health shares on 17 November 2010
of R14.60 and the carrying value of Health shares at 30 June 2010 of
R13.55.
6 The proceeds received on the Equity Placing of R143 million plus the
proceeds received on the sale of the remaining Health shares in August and
September 2010 of R22 million have been used to reduce interest bearing
debt of portfolio investments.
7 Interest paid has been reduced by R12 million as a result of the Equity
placing proceeds applied to interest bearing debt. Taxation claimed in
respect of this has been reversed.
8 Dividends received of R7.9 million on Health shares disposed of have been
reversed in the statement of comprehensive income.
9 A loss on disposal due to the Equity Placing of R9.4 million has been
recognised being the difference between the fair value of Health shares at
17 November 2010 of R14.60 per share and the net proceeds received on the
sale of Health shares.
10 A deferred taxation asset of R258,000 has been recognised in respect of the
capital loss on the Equity placing, calculated as the difference between
the tax base cost of Health shares and the proceeds received on the equity
placing.
29 November 2010
Johannesburg
Sponsor to Mvela Group
Deutsche Securities (SA) (Proprietary) Limited
Sole Bookrunner
Absa Capital, a division of Absa Bank Limited
Attorneys to Mvela Group
Cliffe Dekker Hofmeyr Inc
Reporting accountants
PKF (Jhb) Inc
Date: 29/11/2010 17:15:10 Produced by the JSE SENS Department.
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