| Fri 19 Aug 2011, 17:30 | | KIR - Kairos Industrial Holdings Limited - Business update Brokrew |
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KIR
KIR
KIR - Kairos Industrial Holdings Limited - Business update Brokrew
Industrial (Pty) Limited and cautionary announcement
Kairos Industrial Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number 1987/002927/06)
Share code: KIR ISIN: ZAE000011284
("Kairos" or "the Group")
BUSINESS UPDATE - BROKREW INDUSTRIAL (PTY) LIMITED AND CAUTIONARY
ANNOUNCEMENT
Liquidation of Brokrew Industrial (Pty) Limited
Shareholders have been advised in prior annual reports of the Group that its
subsidiary, Brokrew Industrial (Pty) Limited ("Brokrew") had been adversely
affected by the cancellation of the Medupi Contract. Subsequent to this
cancellation Brokrew has written off amounts of R69 million and R17 million
in the 2010 and 2011 financial years respectively, for debts owed, claims
against and work done for the primary contractor.
The above situation rendered Brokrew in a precarious financial position and
the Group sought further working capital finance from its financiers, which
has also been alluded to in the annual report for the 2011 financial year.
The Group has to date not been able to successfully conclude these
negotiations.
In July 2011, metal industry workers embarked on a nationwide strike for
more than two weeks and Brokrew was forced to shut down all four of its
factories, which was exacerbated by subsequent strikes at that mines that it
serves. Given its already precarious financial position, this was a
situation that Brokrew could ill afford. At present, Brokrew is thus unable
to service any significant clients and raw material suppliers have ceased
delivering to the company.
Accordingly, shareholders are advised that the Brokrew board of directors
has decided, based upon their assessment of the above facts, to place
Brokrew into voluntary liquidation.
Proposed Delisting of Kairos
Shareholders are further referred to the SENS announcement dated 8 June
regarding the proposed delisting of Kairos. In light of the above and the
resultant uncertainty regarding the impact on, and the financial effects for
the Group, the proposed delisting of Kairos will be reviewed once greater
certainty is achieved regarding the impact of the above developments.
Cautionary Announcement
Shareholders will be advised of any material developments, as well as the
financial effects thereof once more reliably determined. Shareholders are
advised to exercise caution when dealing in Kairos shares until further
announcements in respect of the above is made.
Pretoria
19 August 2011
Sponsor: Bridge Capital Advisors (Pty) Limited
Date: 19/08/2011 17:30:01 Produced by the JSE SENS Department.
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