| Wed 6 Jul 2011, 8:00 | | BAT - BRAIT S.A. - Transaction completion announcement regarding Brait`s |
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BAT
BRAIT
BAT - BRAIT S.A. - Transaction completion announcement regarding Brait`s
successful ZAR 6.4 billion capital raising through a rights offer and private
placement and the acquisition of equity interests in Pepkor Holdings Limited and
Premier Group (Proprietary) Limited
BRAIT S.A.
(Incorporated in Luxembourg)
(Registered address: 42, rue de la Vallee, L-2661 Luxembourg)
(RCS Luxembourg B-13861)
ISIN: LU0011857645
Share code: BAT
("Brait" or "the Company")
TRANSACTION COMPLETION ANNOUNCEMENT REGARDING BRAIT`S SUCCESSFUL ZAR 6.4 BILLION
CAPITAL RAISING THROUGH A RIGHTS OFFER AND PRIVATE PLACEMENT AND THE ACQUISITION
OF EQUITY INTERESTS IN PEPKOR HOLDINGS LIMITED ("Pepkor") AND PREMIER GROUP
(PROPRIETARY) LIMITED ("Premier")
Key Highlights:
- Initial ZAR 5.9 billion Rights Offer fully subscribed due to strong
investor demand
- Additional ZAR 500 million raised through Investment Team Private Placement
- ZAR 5.1 billion (or 80%) of the ZAR 6.4 billion capital raised already
invested
- Successful completion of the Pepkor and Premier acquisitions
- Unaudited Net Asset Value ("NAV") at ZAR 17.80 per Share (an increase of 8%
from ZAR 16.50 per Share as at the date of the Circular) due to strong
operational performance
- ZAR 1.7 billion of cash available to fund future investments
Rights Offer and Private Placements:
Brait is pleased to announce the successful completion of its ZAR 6.4 billion
capital raising and acquisition of equity interests in Pepkor and Premier. In
this regard, holders of ordinary shares of no par value in Brait ("Shares")
("Brait Shareholders") are referred to the announcements released on SENS and on
the website of the Luxembourg Stock Exchange ("LuxSE") on 2 March 2011, 25 March
2011, 4 April 2011, 4 May 2011 and 29 June 2011 as well as the circular to Brait
Shareholders dated 18 April 2011 (the "Circular").
The capital raising of ZAR 6.4 billion (approximately US$950 million) represents
the largest pool of private equity capital raised in Africa to date and in the
shortest period of time, namely within four months.
Summary results of the Rights Offer and Private Placement:
Original number of Shares in issue 118 987 321
Number of Rights available for exercise (3 for 356,961,963
1)
Value of Rights on offer at ZAR 16.50 each ZAR 5,889,872,390
Rights exercised by Brait Shareholders 288,978,441
Excess number of Rights taken up at the 67,983,522
Auction
Private Placement to Investment Team - number 30,251,409
of Shares
Value of Private Placement to Investment Team ZAR 499,148,249
at ZAR 16.50 per Share
Total Proceeds from available Rights and ZAR 6,389,020,638
Private Placement
Total new number of Shares in issue 506,200,693
The Investment Team Private Placement of 30,251,409 additional Shares resulted
in the Investment Team achieving its targeted 18% shareholding, thereby ensuring
strong alignment with Brait Shareholders.
The private placement to Titan was no longer necessary, as Titan achieved its
desired shareholding of approximately 33.33% through acquiring Shares in the
market, Rights during the Rights Offer period and at the Auction.
Application of the proceeds from the Rights Offer and Private Placement
The acquisition of significant equity interests in Pepkor and Premier has been
successfully completed following the closing of the Rights Offer and Private
Placement. Importantly, 80% of the cash that was raised was deployed immediately
upon receipt, ensuring minimal cash drag on the balance sheet.
Summary of Transaction cash flows:
ZAR
millions
Total proceeds from available Rights and Private
Placement 6,389.0
Add: Proceeds from Pepkor and Premier disposal by 936.0
Brait Private Equity Funds
Less: Subscription for 24.6% equity interest in Pepkor (3,210.5)
Less: Subscription for 49.9% equity interest in a (801.0)
geared Pepkor SPV which owns 24.6% of Pepkor
Less: Acquisition of 49.9% equity interest in Premier (1,078.1)
and ZAR 221 million shareholder loans
Less: Estimated total transaction costs
(100.0)
Less: Repayment of RMB ZAR 450,000,000 preference (450.0)
share funding
Net cash available for future investments 1,685.4
As shown above, the Group cash available for future investments is ZAR 1.7
billion post the capital raising, which equates to 18.9% of the revised NAV.
Unaudited NAV for Brait of ZAR 17.80 per Share as at 5th July 2011
The upward adjustment to Brait`s NAV is primarily as a result of the increased
valuation of Pepkor as at 5 July 2011. Pepkor has been revalued using the 30
June 2011 financial year estimated EBITDA of ZAR 2.470 billion and the same
EBITDA multiple of 7.5 times per the Circular. Premier has been held at the same
valuation levels, as per the Circular.
The net impact of the above is a Group unaudited NAV of ZAR 9 billion or ZAR
17.80 per Share.
Trading of new Brait Shares
For Brait Shareholders who exercised their Rights, please note: (i) share
certificates were posted to holders of certificated Shares on or about Monday, 4
July 2011; and (ii) the Central Securities Depository Participant ("CSDP") or
Broker accounts of holders of dematerialised Shares were credited with the new
Brait Shares which the Company issued pursuant to the Rights Offer and debited
with any payments due on Monday, 4 July 2011.
Appreciation
The Brait Board of Directors would like to extend its appreciation to its Brait
Shareholders, the Underwriters, the Advisors as well as the Investment Team for
the successful completion of the Transaction.
6 July 2011
Financial advisor, mandated lead debt arranger and advisor, underwriter and
transaction sponsor
RAND MERCHANT BANK (a division of FirstRand Bank Limited)
International legal advisor
M Partners
South African attorneys
Cliffe Dekker Hofmeyr Inc.
Co-debt Underwriter
The Standard Bank of South Africa Limited
Date: 06/07/2011 08:00:01 Produced by the JSE SENS Department.
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