| Mon 2 Jul 2012, 11:20 | | Acquisition by Metropolitan Life Namibia of Momentum Group's 49% shareholding in Momentum Life Assurance Namibia |
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MMI
Acquisition by Metropolitan Life Namibia of Momentum Group's 49% shareholding in Momentum Life Assurance Namibia
MMI Holdings Limited
(Incorporated in the Republic of
South Africa)
(Registration number
2000 031756 06)
ISIN ZAE000149902
JSE Share Code MMI
NSX Share Code MIM
(a??MMI Holdingsa??)
Acquisition by Metropolitan Life Namibia Limited, a subsidiary of MMI Holdings, of Momentum Group Limiteda??s 49
percent shareholding in Momentum Life Assurance Namibia Limited, resulting in the consolidation of MMI
Holdingsa?? operations in Namibia
INTRODUCTION
Shareholders of MMI Holdings are referred to the announcement published by MMI Holdings and FNB Namibia
Holdings Limited on 21 June 2012. Shareholders are advised that Metropolitan Life Namibia Limited
("Metropolitan Life Namibia"), a subsidiary of MMI Holdings, has entered into a binding sale of shares agreement
with Momentum Group Limited ("Momentum") in terms of which Metropolitan Life Namibia will, subject to the
fulfilment of the suspensive condition referred to below ("Suspensive Condition"), acquire Momentum's 49 percent
shareholding in Momentum Life Namibia from Momentum (the "Transaction").
Momentum Life Namibia conducts business as a registered long-term insurer in Namibia.
SMALL RELATED PARTY TRANSACTION
MMI Holdings is a material shareholder of Metropolitan Life Namibia, Momentum and Momentum Life Namibia for
purposes of the Listings Requirements of the JSE Limited ("Listings Requirements"). As a result the Transaction
is categorised as a small related party transaction in terms of section 10.7 of the Listings Requirements.
THE TRANSACTION
Rationale for the Transaction
The acquisition by Metropolitan Life Namibia of the remaining 49 percent of Momentum Life Namibia from
Momentum concludes the integration of Metropolitan Life Namibia and Momentum Life Namibia. The Transaction
will enable a coordinated approach in growing the businesses, using three independent brands, Momentum,
Metropolitan and Swabou as client facing brands that will cover the full Living Standards Measure spectrum in the
Namibian market.
The consolidation of MMI Holdings' insurance operations in Namibia will lead to improved efficiencies and is in
line with international practices for insurance groups and financial conglomerates. The Transaction creates a
platform for MMI Holdings to grow its presence in Namibia.
Terms of the Transactions
In terms of the Transaction, Momentum will dispose of its 49 percent interest in Momentum Life Namibia to
Metropolitan Life Namibia with effect from (i) 1 July 2012 if the Suspensive Condition is fulfilled on or before
31 July 2012; or (ii) the last business day of the calendar month during which the Suspensive Condition is fulfilled
if the Suspensive Condition is fulfilled after 31 July 2012 (the "Transaction Closing Date").
Purchase price
The purchase price payable by Metropolitan Life Namibia to Momentum for Momentum's 49 percent shareholding
in Momentum Life Namibia is N$349 198 085, adjusted upwards at 13 percent from 1 July 2012 up to the
Transaction Closing Date.
The purchase price shall be paid by K 2012071065 (South Africa) Proprietary Limited ("HoldCo"), a subsidiary of
MMI Holdings, on behalf of Metropolitan Life Namibia from its own resources.
Following the implementation of the Transaction, Momentum Life Namibia will become a wholly-owned subsidiary
of Metropolitan Life Namibia.
Pro forma financial effects
The pro forma financial effects of the Transaction on MMI Holdings' earnings per share, headline earnings per
share, net asset value per share and tangible net asset value per share, based on MMI Holdings' latest published
interim financial results for the 6-month period ended 31 December 2011, are insignificant as contemplated in
paragraph 9.15 of the Listings Requirements.
SUSPENSIVE CONDITION
The Transaction is subject to the suspensive condition that MMI Holdings receives confirmation from an
independent expert acceptable to the JSE Limited ("JSE") that the terms of the Transaction are fair to the
shareholders of MMI Holdings.
FURTHER ANNOUNCEMENT
In terms of section 10.7(b) of the Listings Requirements, MMI Holdings is required to provide the JSE with written
confirmation from an independent expert acceptable to the JSE, that the terms of the Transaction are fair as far
as the shareholders of MMI Holdings are concerned ("Fairness Opinion").
MMI Holdings has engaged Deloitte and Touche to prepare the Fairness Opinion. Following receipt of the
Fairness Opinion, MMI Holdings will provide the JSE with a copy thereof and will release a further announcement
on SENS advising shareholders of the findings in the Fairness Opinion. Assuming that Deloitte and Touche found
that the terms of the Transaction are fair to MMI Holdings shareholders, the Fairness Opinion will lie for inspection
at MMI Holdings' registered office for a period of 28 days from the date of the further announcement.
2 July 2012
Merchant bank and sponsor to MMI Holdings
RAND MERCHANT BANK (A division of FirstRand Bank Limited)
Legal advisors to MMI Holdings
Webber Wentzel
Sponsor to MMI Holdings
Merrill Lynch South Africa (Proprietary) Limited
NSX sponsor to MMI
Simonis Storm Securities Proprietary Limited
Date: 02/07/2012 11:20:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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