| Wed 3 Aug 2011, 8:12 | | DEC - Decillion Limited - Detailed cautionary announcement regarding the |
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DEC
DEC
DEC - Decillion Limited - Detailed cautionary announcement regarding the
acquisition by Decillion of all the issued shares of Ardor Property Holdings
(Pty) Ltd and further cautionary announcement
Decillion Limited
(Registration number: 1998/011692/06)
(Incorporated in the Republic of South Africa)
JSE code: DEC & ISIN: ZAE000108247
("Decillion" or "the Company")
DETAILED CAUTIONARY ANNOUNCEMENT REGARDING THE ACQUISITION BY DECILLION OF ALL
THE ISSUED SHARES OF ARDOR PROPERTY HOLDINGS (PTY) LTD ("ARDOR") AND FURTHER
CAUTIONARY ANNOUNCEMENT
INTRODUCTION
Following the cautionary announcements released on SENS on 25 May 2010, 8 July
2010, 20 August 2010, 04 October 2010, 15 November 2010, 28 December 2010, 08
February 2011, 22 March 2011, 06 May 2011 and 21 June 2011 respectively, which
announcements detailed that the Company had entered into negotiations with a
construction and property development company who are acquiring and
consolidating a diversified property portfolio, for a possible reverse listing
of a large construction company, development company and the properties being
acquired into Decillion, is pleased to announce that Decillion and Ardor Group
Proprietary Limited ("Ardor Group") have signed a Memorandum of Understanding
("MOU") dated 2 August 2011.
The MOU agrees that Decillion acquires from Ardor Group all the issued shares of
Ardor Property Holdings Pty Ltd ("Ardor") for a purchase consideration of R76
million subject to the conclusion of the conditions precedent detailed below.
CONDITIONS PRECEDENT
The acquisition is subject to the fulfilment of the following conditions
precedent:
* R29 million of the purchase consideration is payable in equity and the
remaining R47 million payable in cash.
* The cash payment will be phased over 12 months in line with Decillion`s
equity placement and acquisition plan currently being prepared by the
Decillion board.
* The first cash payment of R30 million will be paid within 14 days after the
unsuspension of Decillion ("First Payment"). Post completion of the
acquisition Ardor will own all the shares of the companies holding 100% of
the following properties, known as:
* Sparrow Retail Mall (complete)
* Furrowlane Hotel and Conference Venue (complete)
* Die Werf (partially complete)("Die Werf")
* Ardor offices (complete and to house the new Decillion corporate head
office)
* Windmill Mall (under development)("Windmill")
* Estcourt Retail Mall (in final planning)("Estcourt")
Hereinafter "the Portfolio"
* R16.8 million of First Payment will be used to complete the land
acquisitions by Ardor relating to Windmill and Estcourt.
* The maximum bank and or other liabilities to be assumed by Decillion in
relation to the Portfolio will not exceed R67 million, excluding
development and related debt to be incurred in relation to the development
of Die Werf, Windmill and Estcourt.
* The historic net income before interest and tax of the Portfolio is R15.9
million rounded, not accounting for any projected annuity rental and
development income for Die Werf, Windmill and Estcourt post completion, and
escalation in rental income of the current income producing properties.
* The bank interest will be at a maximum interest rate of prime or such other
rate as agreed by the board with the current financiers of the Portfolio.
* The transaction is subject to approval by the shareholders of Decillion as
well as regulatory approval and the completion of due diligences by the
respective parties on each other within 30 days hereof.
* Ardor Group will nominate at least two directors to the board of Decillion.
* The acquisition is subject to the capitalisation of all existing debts in
Decillion.
ARDOR PROPERTY PORTFOLIO
Details on the property portfolio and financial effects will be announced in due
course.
REVERSE TAKEOVER
Shareholders are cautioned that the implementation of the proposed acquisition
will result in the issue of more than 100% of the current issued share capital
of the Company, and accordingly will result in a reverse takeover of Decillion
for the purposes of the Listings Requirements, which stipulate that the Company
can only retain its listing following the reverse take-over if the JSE is
satisfied that the Company continues to qualify to be listed.
The listing on the Main Board is conditional on the Company maintaining the said
shareholder spread requirements.
PRO FORMA FINANCIAL EFFECTS OF THE TRANSACTIONS
A separate SENS announcement detailing the pro forma financial effects will be
published in due course.
CHANGE OF CONTROL
Depending on the outcome of separate ongoing acquisition discussions, which
outcomes will be detailed in a separate announcement once concluded, there may
or may not be a change in control. This will be determined in due course and
further announcements made where required.
DOCUMENTATION AND SALIENT DATES
A circular to shareholders detailing the terms of the acquisition and reverse
takeover, incorporating revised listing particulars will be drafted and
distributed to shareholders in due course.
Salient dates shall also be announced in due course.
FURTHER CAUTIONARY ANNOUNCEMENT
Since the Company is still negotiating further acquisitions and the final terms
and pro forma financial effects of the above-mentioned acquisition and reverse
takeover have not yet been published, shareholders are advised to continue
exercising caution when dealing in the Company`s securities until a full
announcement is made.
JOHANNESBURG
2 August 2011
SPONSOR
Arcay Moela Sponsors (Proprietary) Limited
Date: 03/08/2011 08:12:01 Produced by the JSE SENS Department.
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