| Thu 1 Dec 2011, 10:58 | | SUI/RAH - Sun International Limited/Real Africa Holdings Limited - Firm |
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RAH SUI
RAH SUI
SUI/RAH - Sun International Limited/Real Africa Holdings Limited - Firm
intention announcement
SUN INTERNATIONAL LIMITED
(Incorporated in the Republic of South Africa)
(Registration number: 1967/007528/06)
Share code: SUI
ISIN:ZAE000097580
("Sun International")
REAL AFRICA HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number: 1994/003919/06)
(Share code: RAH)
(ISIN: ZAE000008702)
("RAH" or "the Company")
JOINT ANNOUNCEMENT OF A FIRM INTENTION TO MAKE AN OFFER BY SUN
INTERNATIONAL (SOUTH AFRICA) LIMITED ("OFFEROR"), A WHOLLY-OWNED SUBSIDIARY
OF SUN INTERNATIONAL, TO ACQUIRE ALL OF THE ORDINARY SHARES IN THE ISSUED
SHARE CAPITAL OF RAH (WHICH IT DOES NOT ALREADY OWN) ON THE BASIS SET OUT
IN THIS JOINT ANNOUNCEMENT
1. INTRODUCTION
RAH and Sun International shareholders are referred to the RAH
announcement released on SENS on 30 August 2011 wherein RAH
shareholders were advised that Sun International, through the offeror,
had expressed an interest to acquire the entire issued ordinary share
capital of RAH ("the RAH shares") that Sun International does not
indirectly (through the offeror) already own ("the proposed
acquisition").
The offeror has notified the board of directors of RAH of its
intention to proceed with the proposed acquisition to be implemented
by way of an offer by the offeror to acquire all the RAH shares in
issue, other than those held by the offeror, ("offer shares") in terms
of Section 117(1)(c)(v) of the Companies Act, No. 71 of 2008, as
amended from time to time, (the "Companies Act") read with Section
117(f) and in terms of the Takeover Regulations, Chapter 5
(Fundamental Transactions and Takeover Regulations) of the Companies
Regulations, 2011 promulgated under the Companies Act ("the Takeover
Regulations") ("the offer").
2. THE OFFER
2.1 Terms of the Offer
Subject to the approvals and/or consents to effect the offer being
granted by the Takeover Regulation Panel ("TRP") and the JSE Limited
("JSE") the offeror intends to make an offer to acquire all of the
offer shares for a cash consideration of 422 cents per RAH share (the
"offer consideration").
The offer consideration represents:
- a 26% premium to the RAH market price of 335 cents as at the date
prior to the initial cautionary announcement on SENS, being 7
December 2010 (the "cautionary announcement"); and
- a 27% premium to the 30 day volume weighted average trading price
of RAH of 331 cents for the 30 day period to the date prior to
the cautionary announcement.
In the event that the RAH shareholders holding at least 90% (ninety
percent) of the offer shares accepts the offer within 4 (four) months
after the date the date of the offer, the offeror reserves the right
to invoke the provisions of Section 124 of the Companies Act to
compulsorily acquire all of the offer shares in respect of which the
offer was not accepted.
Should the offeror become entitled to and elect to exercise its
entitlement in terms of Section 124 of the Companies Act, RAH will
become a wholly-owned subsidiary of Sun International and an
application will be made to the JSE for the listing of the RAH shares
on the JSE to be terminated.
2.2 Payment of the offer consideration and cash confirmation
The offeror confirms that it has sufficient cash resources and/or
facilities to satisfy, in full, the offer consideration. In this
regard, the TRP has been furnished with independent written
confirmation from RMB and Nedbank that the offeror has sufficient cash
resources and / or facilities to satisfy, in full, the offer
consideration.
3. RATIONALE AND REASONS FOR THE OFFER
RAH`s primary investment is its 76,8% interest in Afrisun Leisure
Investments (Pty) Limited`s ordinary shares and 100% interest in
Afrisun Leisure SW, KZ, and AG shares.
- Afrisun Leisure holds minority interests in a number of Sun
International`s subsidiaries namely:
- Afrisun Gauteng (Pty) Limited (Carnival City casino) (22,9%
effective economic interest);
Afrisun KZN (Pty) Limited (Sibaya casino) (14,6% effective
economic interest);
- Emfuleni Resorts (Pty) Limited ("Emfuleni") (Boardwalk casino and
Fish River Sun) (3,5% effective economic interest);
- SunWest International (Pty) Limited (GrandWest casino and Table
Bay Hotel) (14,9% effective economic interest);
- Worcester Casino (Pty) Limited (Golden Valley casino and lodge)
(9,7% effective economic interest);
- Zonwabise Resorts (Pty) Limited (Holds an effective 20,3% in
Emfuleni) (26,7% effective economic interest);
- National Casino Resort Manco (Pty) Limited (33,0% effective
economic interest); and
- Gauteng Casino Resort Manco (Pty) Limited (30,0% effective
economic interest).
The offer will create a single listed point of entry into the Sun
International Group whilst simultaneously increasing Sun
International`s exposure to its own existing core gaming activities.
The offeror currently owns 66.53% of the RAH shares in issue with
Grand Parade Investments Limited ("GPI") and Utish Investments (Pty)
Limited ("Utish") collectively owning 30,57% of the RAH shares. The
RAH shares therefore have very limited liquidity and RAH minority
shareholders have limited options to realise their investment. Only
0,003% of RAH`s shares trading in a 30 day period (0,007% over 60
days) up to Tuesday, 29 November 2011, the date prior to this
announcement.
The offer provides RAH shareholders with an opportunity to realise the
underlying value of their investment in RAH, whilst reducing the
distribution costs associated therewith, thereby maximising value for
RAH shareholders.
4. PRO FORMA FINANCIAL EFFECTS OF THE OFFER
The table below sets out the pro forma financial effects of the offer
on a RAH shareholder who accepts the offer:
Market Offer Change
value consideration(1 (%)
before ) (cents)
the
offer
(cents)
Financial effects as at 7
December 2010(2):
Market value (3) 335 422 26%
30-day volume weighted average 331 422 27%
(4)
60-day volume weighted average 323 422 31%
(5)
242 422 74%
Net asset value (RAH balance
sheet for the year ended 30
June 2011) (6)
Net asset value (RAH directors` 349 422 21%
valuation) (6)
Issued shares, net of treasury 361.9
shares (million)
Notes and assumptions:
(1) No account has been taken of adjustments for interim RAH
distributions, taxes, commissions or any other charges in
calculating the above financial effects.
(2) All financial effects, other than the net asset value
calculations, are calculated as at 7 December 2010, being the
last trading day prior to the publication of the cautionary
announcement by Sun International.
(3) The closing market price per RAH share on 7 December 2010.
(4) The volume weighted average traded price of RAH shares over the
30 trading days up to and including 7 December 2010, being the
last trading day prior to the publication of the cautionary
announcement by Sun International.
(5) The volume weighted average traded price of RAH shares over the
60 trading days up to and including 7 December 2010, being the
last trading day prior to the publication of the cautionary
announcement by Sun International.
(6) Per RAH annual report for the year ended 30 June 2011.
5. IRREVOCABLE UNDERTAKINGS
Each of Utish and GPI, who collectively hold 110 641 690 RAH shares
(constituting 30,57% of the RAH shares in issue excluding treasury
shares) have irrevocably and unconditionally undertaken to accept the
offer within 2 business days of the offer being made.
6. SUN INTERNATIONAL SHAREHOLDINGS IN RAH
The offeror currently owns a beneficial interest of 66.53% in RAH
ordinary shares (excluding treasury shares).
Neither the offeror nor Sun International have traded in RAH shares
over the last six months.
7. RECOMMENDATION AND FAIR AND REASONABLE OPINION
A sub-committee of the RAH board of directors comprising of the three
independent directors of RAH (the "Independent Board") was formed for
the purposes of considering the offer according to the requirements of
the Takeover Regulations.
The Independent Board has appointed KPMG Services (Proprietary)
Limited, an independent advisor acceptable to the TRP, to provide it
with external advice in relation to the offer and to make appropriate
recommendations to the Independent Board for the benefit of RAH
shareholders. The Independent Board has received an opinion from the
independent expert to the effect that the offer consideration is fair
and reasonable. The substance of the external advice and the views of
the Independent Board will be detailed in the offer circular to be
sent to RAH shareholders in relation to the offer.
The Independent Board, based on the information currently available is
satisfied that the offer is fair and reasonable and unanimously
recommend to RAH shareholders that they accept the offer by tendering
their RAH shares in terms of the offer
8. THE OFFER CLOSING DATE
The closing date of the offer is 12:00 on Friday, 27 January 2012. RAH
shareholders that wish to accept the offer must accordingly do so (in
the manner stipulated in the offer circular) by not later than 12:00
on Friday, 27 January 2012.
The payment of the offer consideration will be made to RAH
shareholders as set out in paragraphs 9 and 10 below.
9. SALIENT DATES AND TIMES
2011
Opening date of offer at 09:00 Monday, 5 December
2012
Last day for RAH shareholders to trade on the Friday, 20 January
JSE to participate in the offer
Shares trade ex the right to participate in the Monday, 23 January
offer
Record date on which RAH shareholders must be Friday, 27 January
recorded in the register in order to
participate in the offer
Closing date of the offer (12:00) Friday, 27 January
Results of the offer announced on SENS Monday, 30 January
Results of the offer published in the press on Tuesday, 31 January
Offer consideration posted to offer Offer consideration
participants who have not dematerialised their settlement dates, being
RAH shares (once documents of title have been within six business
received) days after acceptance
of the offer until the
sixth business day
after the closing date
Offer consideration credited to the CSDP or Offer consideration
broker, as the case may be, of offer settlement dates, being
participants who have dematerialised their RAH within six business
shares and who have accepted the offer days after acceptance
of the offer until the
sixth business day
after the closing date
Notes:
1) The above dates and times are subject to amendment following the
approval from the TRP. Any such change will be announced on SENS
and/or published in the press.
2) All times indicated above are South African times.
10. ACTIONS TO BE TAKEN BY RAH SHAREHOLDERS
RAH shareholders that wish to accept the offer ("offer participants")
and who have dematerialised their RAH shares, either in whole or in
part, should instruct their duly appointed CSDP or broker, in the
manner and time stipulated in the agreement governing their
relationship with their CSDP or broker, to accept the offer and
electronically deliver their RAH shares.
The offer consideration will be credited to the CSDP or broker, as the
case may be, of offer participants who have dematerialised their RAH
shares and accepted the offer, at their risk and dealt with in terms
of the custody agreement entered into between the offer participant
and their CSDP or broker, on the respective dates set out in paragraph
9 above.
RAH shareholders who have not dematerialised their RAH shares
("certificated RAH shareholders") who wish to accept the offer must
complete the form of acceptance, surrender and transfer attached to
the offer circular in accordance with the instructions contained
therein and forward it together with the relevant documents of title,
by hand or by mail to the transfer secretaries, Computershare Investor
Services 2004 (Pty) Limited, Ground Floor, 70 Marshall Street,
Johannesburg, 2001 (PO Box 61763, Marshalltown, 2107) so as to be
received by not later than 12:00 on the closing date.
The offer consideration will be posted to certificated RAH
shareholders accepting the offer, on the respective dates set out in
paragraph 9 above, provided the form of acceptance, surrender and
transfer, together with the relevant document(s) of title (in
negotiable form) are received by the transfer secretaries before 12:00
on the closing date of the offer.
Additional copies of the form of acceptance, surrender and transfer to
be used by certificated RAH shareholders who wish to accept the offer
may be obtained from the offices of Sun International`s transfer
secretaries, Computershare Investor Services 2004 (Proprietary)
Limited.
11. DOCUMENTATION
Further details of the offer will be included in the offer circular to
be sent to RAH shareholders, containing, inter alia, a form of
acceptance, surrender and transfer. The offer circular is expected to
be posted to RAH shareholders on or about Monday, 5 December 2011.
12. RESPONSIBILITY STATEMENT
Sun International and the Independent Board accept responsibility for
the information contained in this firm intention announcement. To the
best of their respective knowledge and belief, the information
contained in this announcement is true and nothing has been omitted
which is likely to affect the import of the information.
Johannesburg
1 December 2011
Investment bank to Sponsor to Sun Attorneys to Sun
Sun International International International
Investec Bank Investec Bank ENS
Limited Limited
Independent Expert Sponsor to RAH Attorneys to RAH
to RAH
KPMG Investec Bank Bowman Gilfillan
Limited
Date: 01/12/2011 10:58:04 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.
