| Thu 1 Mar 2012, 10:11 | | MUR - Murray & Roberts Holdings Limited - Declaration information relating to a |
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MUR
MUR
MUR - Murray & Roberts Holdings Limited - Declaration information relating to a
renounceable rights offer of approximately R2 billion and further cautionary
announcement
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO
THE UNITED STATES, CANADA, AUSTRALIA, JAPAN AND HONG KONG
Murray & Roberts Holdings Limited
(Incorporated in the Republic of South Africa)
Registration number: 1948/029826/06
JSE Code: MUR ISIN: ZAE000073441
("Murray & Roberts" or "Group" or "Company")
DECLARATION INFORMATION RELATING TO A RENOUNCEABLE RIGHTS OFFER OF APPROXIMATELY
R2 BILLION AND FURTHER CAUTIONARY ANNOUNCEMENT
1 INTRODUCTION
Shareholders of Murray & Roberts ("Shareholders") are referred to the
announcement by Murray & Roberts released on the Securities Exchange News
Service ("SENS") of the JSE Limited ("JSE") on Tuesday, 31 January 2012 and
published in the South African press on Wednesday, 1 February 2012,
regarding the notice of general meeting, which notice was posted to
Shareholders on Tuesday, 31 January 2012 ("Notice"). Shareholders are
further referred to the announcement released on SENS on Wednesday, 29
February 2012 regarding the approval by the requisite majority of
Shareholders of all the resolutions proposed at the general meeting.
The board of directors of Murray & Roberts ("Board") is pleased to announce
that the Company intends to raise approximately R2 billion through a
renounceable rights offer ("Rights Offer"), subject to the satisfaction of
the conditions precedent set out in paragraph 3 below. It is the Company`s
intention to have the Rights Offer fully underwritten subject to customary
terms and conditions to be contained in an underwriting agreement, which is
expected to be entered into at the time of the launch of the Rights Offer.
In furtherance of this intention, the Company has appointed J.P. Morgan
Securities Ltd ("J.P. Morgan") and The Standard Bank of South Africa
Limited ("Standard Bank") as Joint Global Coordinators and Joint
Bookrunners for the Rights Offer.
2 RATIONALE AND APPLICATION OF PROCEEDS
Subsequent to the October 2008 global financial crisis, and in particular
since early 2010, Murray & Roberts` business environment has been impacted
by the weakening of the global economy and the slowdown in South African
public spending on infrastructure. These factors, together with the
challenges experienced on three of the Group`s projects namely, Dubai
International Airport, Gautrain Rapid Rail Link and the Gorgon Pioneer
Materials Offloading Facility, which resulted in unresolved claims, caused
Murray & Roberts to end the 2011 financial year in a weakened financial
position.
As a result, managing short-term liquidity has been a key focus for the
Group in recent months given the protracted nature of major claims
resolution processes and timing of anticipated proceeds from claim
settlements in respect of the abovementioned three projects. To date, the
Group has recognised as uncertified revenues a cumulative amount of
approximately R2,2 billion of these and other claims. This is marginally up
from the R2,0 billion previously reported, primarily due to foreign
exchange movements. The Group`s uncertified revenues are significantly
lower than the estimated value of its claims and variation orders.
In order to improve the Group`s liquidity, Murray & Roberts successfully
completed the restructuring of its South African term debt and bank
facilities during November 2011. This restructuring improves alignment
between the Group`s debt repayment tenure and the timing of anticipated
proceeds to be derived from the settlement of the three major unresolved
claims.
Notwithstanding the Board`s expectation that the term debt and bank
facilities will meet the Group`s expected liquidity requirements over the
short and medium term, the Board intends to implement the Rights Offer
which should allow the Group to withstand the impact of current uncertain
global economic and financial markets. The Board is of the view that the
Rights Offer represents the best opportunity for the Group to retain
strategic flexibility and to preserve and grow long-term Shareholder value.
Specifically, the successful completion of the Rights Offer should give the
Group sufficient flexibility to:
a) benefit from reduced overall debt levels and increased headroom under its
banking facilities. The expected net proceeds from the Rights Offer will be
deployed, in whole or in part, to reduce the Group`s debt. The Board
believes that this strengthening of the Group`s overall financial position
will provide additional support to its recovery and growth plan; and
b) fund the Group`s order book and enable the Group to continue with its
growth strategy. Notwithstanding the current economic environment, the
Group`s order book, secured at an acceptable margin, increased to R57
billion at 31 December 2011. The Board believes that the remaining expected
net proceeds (if any) may be deployed to deliver the projects in the
Group`s order book and provide greater flexibility to invest in core
businesses to enhance its market positions, while pursuing potential growth
opportunities in sub-Saharan Africa and Western Australia.
3 CONDITIONS PRECEDENT
The implementation of the Rights Offer is subject to the fulfilment of the
following conditions precedent:
* the filing of the special resolutions approved at the general meeting
of Shareholders held on Wednesday, 29 February 2012 with the Companies
and Intellectual Property Commission ("Commission"), and the
registration of these resolutions by the Commission, to the extent
applicable;
* approval by the JSE of the circular relating to the Rights Offer (to
be posted in due course) ("Rights Offer Circular");
* approval by the JSE of the application for the listing of the letters
of allocation envisaged in terms of the Rights Offer and of the
application for listing of any Rights Offer shares required for
implementation of the Rights Offer; and
* any other relevant approvals required by the JSE.
4 RENEWAL OF CAUTIONARY ANNOUNCEMENT
Shareholders are advised that the final terms, pro forma financial effects
and salient dates and times of the Rights Offer will be announced in due
course. Shareholders are accordingly advised to continue to exercise
caution when dealing in the Company`s securities until a further
announcement regarding the Rights Offer is made.
Bedfordview
1 March 2012
Joint Global Coordinator and Joint Global Coordinator, Joint
Joint Bookrunner Bookrunner and Transaction
JP Morgan Sponsor
Standard Bank
Lead Independent Sponsor Independent reporting
Deutsche Securities (SA) (Pty) Ltd accountantsDeloitte & Touche
South African legal advisors to the Legal advisors to the Company as to
Company US and English law
Webber Wentzel Linklaters LLP
South African legal advisors to the Legal advisors to the Joint Global
Joint Global Coordinators Coordinators as to US and
Werksmans English law
Latham & Watkins (London) LLP
NOTICE TO RECIPIENTS
The distribution of this announcement in certain jurisdictions may be
restricted. This announcement does not constitute an offer of, or an invitation
to purchase, any securities of the Company in any jurisdiction.
This announcement includes certain "forward-looking statements" that reflect
the current views or expectations of the Board with respect to future events and
financial and operational performance. All statements other than statements of
historical fact are, or may be deemed to be, forward-looking statements,
including, without limitation, those concerning: the Group`s strategy; the
economic outlook for the industry; use of the proceeds of the Rights Offer;
and the Group`s liquidity and capital resources and expenditure. These
forward-looking statements are not based on historical facts, but rather
reflect the Group`s current plans, estimates, projections and expectations
concerning future results and events and generally may be identified by the
use of forward-looking words or phrases such as "believe", "expect",
"anticipate", "intend", "should", "planned", "may", "potential" or similar
words and phrases.
This announcement is not an offer for the sale of securities. The securities
discussed herein have not been and will not be registered under the U.S.
Securities Act of 1933, as amended (the "U.S. Securities Act"), or under any
securities laws of any state or other jurisdiction of the United States and may
not be offered, sold, taken up, exercised, resold, renounced, transferred or
delivered, directly or indirectly, within the United States absent an exemption
from, or in a transaction not subject to, the registration requirements of the
U.S. Securities Act and in compliance with any applicable securities laws of
any state or other jurisdiction of the United States. The Company does not
intend to register any part of the Rights Offer in the United States.
J.P. Morgan and Standard Bank are acting exclusively for the Company and no
one else in connection with the Rights Offer. They will not regard any other
person (whether or not a recipient of this announcement) as their respective
clients in relation to the Rights Offer and will not be responsible to anyone
other than the Company for providing the protections afforded to their
respective clients nor for giving advice in relation to the Rights Offer or any
transaction or arrangement referred to herein. No representation or warranty,
express or implied, is made by J.P. Morgan and Standard Bank as to the accuracy,
completeness or verification of the information set forth in this announcement,
and nothing contained in this announcement is, or shall be relied upon as, a
promise or representation in this respect, whether as to the past or the future.
J.P. Morgan and Standard Bank assume no responsibility for its accuracy,
completeness or verification and, accordingly, disclaim, to the fullest extent
permitted by applicable law, any and all liability which they might otherwise
be found to have in respect of this announcement or any such statement.
Date: 01/03/2012 10:11:01 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.
