| Mon 21 May 2001, 0:00 | | Detailed Announcement Regarding The Proposed Dispo |
|
UNDERTAKING OF SENTRY
Sentry Group Limited
(Incorporated in the Republic of South Africa)
(Registration number 1989/006287/06)
("Sentry" or "the company")
DETAILED ANNOUNCEMENT REGARDING THE PROPOSED DISPOSAL OF THE ENTIRE BUSINESS
UNDERTAKING OF SENTRY
INTRODUCTION
Further to the announcement published on 10 April 2001, Standard Corporate
and Merchant Bank ("SCMB") is authorised to announce that a detailed
agreement has been concluded between Sentry, ADT Fire and Security plc ("ADT
plc"), ADT Security Services (Proprietary) Limited ("ADT") and certain
Sentry shareholders representing in aggregate approximately 44,1% of
Sentry's issued share capital. ADT plc and ADT are indirectly wholly owned
subsidiaries of Tyco International Limited. In terms of this agreement,
which supersedes the binding letter of intent signed on 6 April 2001,
subject to the suspensive conditions as set out in paragraph 2 below, ADT
plc has nominated ADT as the purchaser in terms of which ADT will acquire
the entire business undertaking of Sentry, for a total consideration of
approximately R627 million ("the consideration") ("the disposal").
It is proposed, subsequent to the implementation of the disposal, to
distribute the proceeds of the disposal to Sentry shareholders by way of an
advance liquidation distribution in anticipation of, or as part of, the
winding-up of Sentry by means of a members' voluntary winding-up in terms of
sections 349 and 350 of the Companies Act, 1973 (Act 61 of 1973), as amended
("the Act") ("the voluntary winding-up"). It is estimated that Sentry
shareholders will receive approximately 350 cents per share in cash as a
result of the disposal and the voluntary winding-up.
CONDITIONS OF THE DISPOSAL
The disposal is subject to the following suspensive conditions:
- the approval of the disposal in general meeting by the requisite majority
of Sentry shareholders;
- the approval of the Competition Commission; and
- the approval of the JSE Securities Exchange South Africa ("JSE"), the
Securities Regulation Panel ("SRP"), and other regulators as necessary.
In order to obtain the approval of the disposal by the relevant competition
authorities, ADT and Sentry jointly filed the requisite merger notification
with the Competition Commission on 2 May 2001. Accordingly, in terms of the
Competition Act, 1998, as amended, the Competition Commission has in the
normal course until 25 July 2001 to consider the aforesaid merger filing,
failing which the disposal will be deemed to have been approved.
FINANCIAL EFFECTS
The financial effects of the disposal on Sentry shareholders are illustrated
in the table below. These are predicated on the assumption that the
distributions to Sentry shareholders arising from the disposal and the
voluntary winding-up will total approximately 350 cents per share.
Pro forma
after the Percentage
Actual disposal change
(cents) (cents) (%)
Share price as at 1 March 2001 218,0 350,0 60,6
Share price as at 9 April 2001 270,0 350,0 29,6
Net asset value ("NAV") per share 29,8 350,0 1 074,5
as at 31 December 2000
Headline earnings per share 12,9 12,9 -
Earnings per share 10,7 12,9 20,6
1 March 2001 was the last day on which Sentry shares traded on the JSE prior
to the publication of the first cautionary announcement.
9 April 2001 was the last day on which Sentry shares traded on the JSE prior
to the announcement of the terms of the disposal.
The NAV calculation per share has been based on the interim balance sheet of
Sentry at 31 December 2000 and assumes that the disposal was effected on
that date. The pro forma NAV per share, after taking into account the
disposal, takes into consideration the estimated costs to be incurred by
Sentry in respect of the disposal and the voluntary winding-up, to the
extent to which they will be borne by Sentry.
The calculation of earnings per share is based upon the earnings and
headline earnings per share for the six-month period ended 31 December 2000.
The calculation of pro forma earnings per share and headline earnings per
share after the disposal assumes that the disposal was effected on 1 July
2000 and that the proceeds thereof were invested at an after tax interest
rate of 7,35%.
OPINIONS, RECOMMENDATIONS AND UNDERTAKINGS
4.1 SCMB was appointed by the board of Sentry ("the board") to consider the
terms and conditions of the disposal. SCMB has advised the board that it
has considered the terms and conditions of the disposal and is of the
opinion that such terms and conditions, including the consideration, are
fair and reasonable to Sentry shareholders.
4.2 The directors of Sentry have considered the terms and conditions of the
disposal, as well as SCMB's opinion, and are of the unanimous opinion that
they are fair and reasonable to shareholders. Accordingly, the board
recommends that shareholders vote in favour of the resolutions to be
proposed at the general meeting as described in paragraph 5 below. The
directors of Sentry intend to vote in favour of the resolutions to be
proposed at the general meeting in respect of their own holdings of Sentry
shares.
4.3 Certain shareholders, including some directors of Sentry, representing
approximately 44,1% of Sentry's issued share capital eligible to vote at the
general meeting, have undertaken irrevocably to vote in favour of the
resolutions necessary to effect the disposal and the voluntary winding-up.
GENERAL MEETING
A general meeting of Sentry shareholders will be held at 08:30 on Friday, 29
June 2001 at Sentry's registered office, 12 Baker Street, Rosebank,
Johannesburg, to consider, and, if deemed fit, pass, with or without
modification, the resolutions necessary to effect, inter alia, the disposal,
the delisting of Sentry from the JSE, and the voluntary winding-up of
Sentry.
JSE LISTING
Sentry's listing on the JSE will be suspended at the close of business on
Wednesday, 25 July 2001, and terminated on the expected record date (as set
out in paragraph 7 below).
SALIENT DATES AND TIMES 2001
Circular and notices of general meeting posted on Wednesday, 30
or about May
Last day to lodge forms of proxy in respect of the
resolutions to be proposed at the general meeting Thursday, 28
of Sentry shareholders by not later than 08:30 on June
General meeting to be held at 08:30 on Friday, 29 June
Results of the general meeting published on Monday, 2 July
Suspension of trading in Sentry shares on the JSE Wednesday,25
from the close of trading on July
The expected record date (Sentry shareholders should
be registered as such by the close of business on Friday, 27 July
this date in order to participate in the
distributions)
Termination of the listing of Sentry shares on the Friday, 27 July
JSE at the close of trading on
Payment of the advance liquidation dividend to Sentry
shareholders, who are registered as such on the Monday, 30 July
expected record date, on or as soon as reasonably
practicable after
Notes
1. The dates and times above are subject to amendment. Any such amendment
to the dates and times will be published in the press. In particular, the
expected record date, the date of suspension of trading, the date of
termination of the listing of Sentry shares and the date of payment of the
advance liquidation dividend are dependent on the date of issue of a
clearance certificate in respect of the disposal by the relevant competition
authorities, which clearance certificate may be issued earlier or later than
is anticipated in this announcement.
2. Subject to there being no amendment to the dates set out above, all
transactions on the JSE of Sentry shares from Monday, 23 July 2001 to
Friday, 27 July 2001 will be for immediate settlement.
DOCUMENTATION
A circular to Sentry shareholders, setting out full details of the
disposal, the delisting of Sentry, the voluntary winding-up, and other
administrative matters, incorporating a notice of general meeting and a form
of proxy, will be posted to Sentry shareholders on or about 30 May 2001.
Johannesburg
21 May 2001
Merchant bank and lead sponsor to Sentry
Standard Corporate and Merchant Bank
(A division of The Standard Bank of South Africa Limited)
(Registration number 1962/000738/06)
Corporate law advisers and consultants to Sentry
Edward Nathan and Friedland (Pty) Ltd
Registration number 1999/026464/07)
Joint sponsor to Sentry
Barnard Jacobs Mellet
Corporate Finance
Financial adviser to ADT plc
Merrill Lynch International
Registered in England
Registration number 2312079
Attorneys to ADT plc
Bell Dewar & Hall, Incorporated
(Registration number 1995/004675/21)
--------------------------------------------------------------------------------
