| Wed 21 Dec 2011, 13:38 | | BRT/BRN - Brimstone Investment Corporation - Announcement regarding an increase |
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BRT BRN
BRT
BRT/BRN - Brimstone Investment Corporation - Announcement regarding an increase
in Brimstone`s shareholding in Oceana Group Limited to 16.86% (20.11% net of
treasury shares)
Brimstone Investment Corporation Limited
(Incorporated in the Republic of South Africa)
Registration number 1995/010442/06
Share Code: BRT ISIN: ZAE000015277
Share Code: BRN ISIN: ZAE000015285
("Brimstone" or the "Company")
ANNOUNCEMENT REGARDING AN INCREASE IN BRIMSTONE`S SHAREHOLDING IN OCEANA GROUP
LIMITED ("OCEANA") TO 16.86% (20.11% NET OF TREASURY SHARES)
1 Introduction
Brimstone is pleased to advise its shareholders that the Company has
acquired an additional 8,500,000 Oceana ordinary shares ("Oceana shares")
at R45.00 per share (cum dividend of R1.83 per share payable to Oceana
ordinary shareholders on 16 January 2012), thereby increasing its
shareholding in Oceana from 9.73% to 16.86% (from 11.61% to 20.11% net of
treasury shares) ("the Transaction"). The Oceana shares were acquired on
market and the Transaction is effective 21 December 2011.
2 Rationale for the Transaction
With the addressing of food security continuing to be a global priority,
Brimstone, one of South Africa`s leading Broad-based Black Economic
Empowerment ("BBBEE") investors, identified the food sector as one of its
areas of strategic focus. The Transaction allows Brimstone to meaningfully
increase its shareholding in Oceana, one of the larger food producers in
Southern Africa, and thereby increase its exposure to the sector.
The Transaction further enhances Oceana`s BBBEE ownership credentials.
3 Description of Oceana
Oceana, known for its Lucky Star brand, is the largest and most diversified
fishing company in South Africa and an important participant in Namibia`s
fishing industry, holding long-term fishing rights for multiple species in
both fisheries. Oceana is listed on the JSE Limited ("JSE") (share code:
OCE).
Oceana`s core business is the harvesting, sourcing, processing, marketing
and distribution of canned fish, fishmeal, fish oil, lobster, horse
mackerel, squid and hake both locally and internationally. It is an
industry leader in canned pilchard, horse mackerel and lobster with its
Lucky Star brand consistently rated one of the top brands in South Africa.
Oceana`s operating facilities are located in St Helena Bay, Lambert`s Bay,
Cape Town, Hout Bay, Port Elizabeth, Humansdorp and Walvis Bay. It employs
1,711 permanent and 512 seasonal employees and is one of the largest
employers on the west coast of South Africa.
Oceana also provides an extensive network of commercial cold storage and
fruit-handling facilities in South Africa and Namibia and operates a
factory producing french fries and other potato products in Lamberts Bay.
Further information on Oceana can be accessed at www.oceana.co.za.
4 Consideration for the Transaction
The total consideration for the Transaction is R382.5 million ("the
Purchase Consideration") and will be settled in cash through Brimstone
accessing its long term funding facilities.
5 Conditions precedent
The Transaction is not subject to any conditions.
6 Unaudited pro forma financial effect of the Transaction ("Financial
Effects")
Based on Brimstone`s unaudited results for the six months ended 30 June
2011 ("Interim Results"), the Financial Effects of the Transaction on
Brimstone`s headline earnings per share ("HEPS") is set out below. The
Financial Effects on Brimstone`s net asset value per share, net tangible
asset value per share and earnings per share for the six months ended 30
June 2011 have not been disclosed as these are not significant.
The Financial Effects are prepared for illustrative purposes only, and
because of its nature, may not give a fair presentation of Brimstone`s
financial position or the effect and impact of the Transaction. The
Financial Effects are the responsibility of Brimstone`s board of directors.
The accounting policies of Brimstone have been used in calculating the
Financial Effects.
Before the After the Change
Transaction(1) Transaction %
HEPS (cents) 81.2 78.6(3) (3.2)
Weighted average number of 243 863 243 863
shares in issue (000`s)
Notes:
1 Based on Brimstone`s Interim Results.
2 In calculating the Financial Effects on HEPS, it was assumed that the
Transaction was implemented on 1 January 2011 for statement of
comprehensive income purposes.
3 The HEPS figure was adjusted for the following:
a An increase in dividends received of R3.1 million and an increase
of R8.4 million in share of profits of associates and joint
venture.
b An increase of R16.5 million in finance costs, which are of a
continuing nature.
C An increased tax charge of R1.3 million.
4 Transaction costs have not been accounted for as they are not
material.
7 Categorisation of the Transaction
The Transaction is categorised as a Category 2 transaction in terms of the
JSE Listings Requirements.
21 December 2011
Cape Town
Investment Bank and Sponsor
Nedbank Capital
Date: 21/12/2011 13:38:01 Produced by the JSE SENS Department.
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