| Thu 10 Feb 2011, 13:46 | | BIO - Bioscience Brands Limited - Sale of Phyto Nova Brand and a further |
|
BIO
BIO
BIO - Bioscience Brands Limited - Sale of Phyto Nova Brand and a further
cautionary announcement
BIOSCIENCE BRANDS LIMITED
(Incorporated in the Republic of South Africa)
(Registration Number: 2005/005805/06)
Share code: BIO
ISIN code: ZAE000115036
("BioScience" or "the company")
SALE OF PHYTO NOVA BRAND
1. Introduction
Shareholders are advised that Vitamology (Proprietary) Limited, a wholly
owned subsidiary of BioScience has sold its brand, Phyto Nova ("the
Brand"), to Akacia Healthcare (Proprietary) Limited ("Akacia").
2. Background and details of the Disposal
In terms of the agreement of the disposal, the disposal consideration of
R2.5 million, will be settled by way of R2 million in cash and R500 000 in
lieu of an existing debt owing to Akacia and/or its subsidiaries or related
companies. Phyto Nova was originally acquired in 2008 before BioScience was
listed and 257 142 857 shares were issued as consideration.
3. Rationale for the Sale
Bioscience has resolved to focus its resources on its larger brands in 2011
and hence the sale of Phyto Nova will provide BioScience with additional
funding in this regard and will also alleviate some pressure on working
capital.
4. Categorisation of the Disposal
In terms of the Altx Listing Requirements of the JSE Limited, the sale of
the Brand is categorised as a Category 2 transaction for Bioscience, as
well as a small related party transaction as a result of Akacia being a
material shareholder in BioScience, with representation on the board.
Accordingly, a fairness opinion and shareholder approval is not required.
5. Illustrative Financial Effects of the Transaction
The unaudited pro forma financial effects set out below are included for
the purpose of illustrating the effect on BioScience shareholders, of the
disposal of the Brand, on earnings ("EPS"), headline earnings ("HEPS"), net
asset value ("NAV") and net tangible asset value ("NTAV") per BioScience
ordinary share for the year ended 30 June 2010.
These unaudited pro forma financial effects:
- are the responsibility of the directors;
- are presented for illustrative purposes only and have not been reviewed by
auditors;
- may, because of their nature, not give a fair reflection of BioScience`s
financial results, changes in equity, cash flows or financial position after the
Transaction; and
- do not necessarily represent or indicate sustainable earnings or future
financial positions.
Before the After the Percentage
Transaction Transaction change
EPS and diluted EPS (cents) (0.26) (0.58) (123%)
HEPS and diluted HEPS (cents) (0.26) (0.31) (19%)
NAV per share (cents) 1.69 1.44 (15%)
NTAV per share (cents) (0.40) (0.30) 25%
Notes and assumptions:
1. The financial information has been extracted from the published annual
financial report of BioScience for the year ended 30 June 2010;
2. EPS, diluted EPS, HEPS and diluted HEPS, as set out in the "After the
Transaction" column , reflect the effects of the sale of the Phyto
Nova brand on EPS, diluted EPS, HEPS and diluted HEPS for the year
ended 30 June 2010 based on the following assumptions:
i. the sale of the Phyto Nova brand was effective 1 July 2009;
ii. the accumulated loss has been adjusted for the R6 500 000
impairment of the intangible asset and the reversal of the R1 211
375 contribution earned from the Phyto Nova brand;
iii. There were no income tax effects;
3. NAV per share and NTAV per share, as set out in the "After the
Transaction" column reflect the effect of the sale of the Phyto Nova
brand on NAV per share and NTAV per share at 30 June 2010 based on the
following assumption:
i. Cash proceeds of R2 000 000 were received and R500 000 was off
set against the amount owed to Akacia as a trade creditor;
ii. Inventory was reduced by R112 000 and off set against the amount
owed to Akacia as a trade creditor.
4. Transaction costs were not accounted for as it is immaterial.
6. Further Cautionary announcement
Bioscience is in continuing discussions with Akacia, as well as other
parties, the outcomes of which will be announced in due course.
Accordingly, shareholders are advised to continue exercising caution when
dealing in BioScience` securities until a further announcement is made.
10 February 2011
Designated Advisor:
PricewaterhouseCoopers Corporate Finance (Proprietary) Limited
Date: 10/02/2011 13:46:01 Produced by the JSE SENS Department.
The SENS service is an information dissemination service administered by the
JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or
implicitly, represent, warrant or in any way guarantee the truth, accuracy or
completeness of the information published on SENS. The JSE, their officers,
employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature,
howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
