| Fri 31 Aug 2001, 0:00 | | Axiam - Offer To Minority Shareholders, Suspension |
|
of Listing
AXIAM HOLDINGS LIMITED
(formerly TBB Holdings Limited)
(Incorporated in the Republic of South Africa)
(Registration number 1997/020853/06)
Share code: AXA ISIN code: ZAE 000027777
("Axiam" or "the company")
OFFER TO MINORITY SHAREHOLDERS, SUSPENSION
AND PROPOSED TERMINATION OF LISTING
Introduction
In the preliminary unaudited results of Axiam for the period ended 28
February 2001 published on 4 June 2001, the directors of Axiam cautioned
that they were not in a position to present audited financial statements for
the period then ended as they were still in the process of unraveling the
financial affairs of Axiam. The process has further identified unrecorded
liabilities at 28 February 2001 which will have the effect of reducing the
net asset value disclosed in the preliminary profit announcement from R5 019
000 to R73 000. Based on expected recoveries to date, other than in respect
of the actions referred to below and before providing for contingent
liabilities, the net asset value of Axiam is not expected to exceed 100
cents per share.
Axiam remains focused on recovering from responsible parties the erosion of
shareholder value that occurred prior to the assumption by PSG Investment
Bank Holdings Limited ("PSGBH") of control of Axiam on 23 October 2000 in
terms of a rescue operation. In pursuance thereof Axiam has instituted
various actions under the Companies Act, 1973 (Act 61 of 1973), as amended
("the Act'), and other legislation that appear to have been contravened, the
outcomes of which are uncertain and could be protracted. In addition, the
Minister of Trade and Industry has appointed inspectors to investigate the
affairs of the company in terms of section 258(1) of the Act. In this
regard, meetings have been held with the inspectors and the matter is
progressing.
In order to curtail further losses all businesses of Axiam have been or are
in the process of being wound down, disposed of or discontinued.
Proposed delisting of Axiam
The directors of Axiam are of the opinion that there appears to be no
justification for the continued listing of Axiam on the JSE Securities
Exchange South Africa ("the JSE") considering:
- the state of Axiam's affairs referred to above;
- that PSGBH controls 98% of Axiam's issued share capital with 334 273
shares out of 16 598 596 shares in issue held by minority shareholders;
- that there is limited prospect of Axiam satisfying the new shareholder
spread requirements of the JSE which become mandatory on 31 December 2001;
- the costs of maintaining a listing.
Consequently, it is proposed:
- to extend an offer to minority shareholders by converting their 334 273
shares into an equal number of redeemable preference shares which will be
redeemed at 100 cents per share, out of the proceeds of a fresh issue of
shares to be subscribed for by PSGBH in terms of section 98 of the Act; and
- that should the net asset value of Axiam after the recovery of losses
referred to above exceed 100 cents per share, such additional amount per
share net of costs will be paid to minority shareholders. The additional
payment will not attract interest and will only be made if the amount
exceeds 10 cents per share,
(collectively, "the redemption").
PricewaterhouseCoopers Corporate Finance (Pty) Limited has considered the
terms and conditions of the redemption and, subject to a review of
underlying documentation, which is currently in the course of preparation
and the finalisation of the audit for the year ended 28 February 2001, is of
the opinion that such terms and conditions are fair and reasonable to
minority shareholders.
The redemption is subject, inter alia, to 75% of minority shareholders
present or represented at a separate class general meeting passing the
requisite resolutions and to the registration of the special resolutions by
the Registrar of Companies.
Subject to the approval and implementation of the redemption, the listing
of Axiam on the JSE will be terminated. A resolution will be proposed that,
failing the implementation of the redemption, Axiam's listing will be
terminated. Such resolution is subject to 50% of minority shareholders
present or represented at a separate class meeting voting in favour thereof.
PSG Investment Bank Limited has confirmed to the Securities Regulation
Panel ("the SRP") that Axiam will have sufficient cash resources to honour
its commitment in terms of the redemption.
Suspension of listing and documentation
The listing of Axiam was suspended on the JSE at the request of the
directors on Friday, 31 August 2001 pending the finalisation of the
financial statements of Axiam for the year ended 28 February 2001 and
posting of the circular referred to below. The financial statements,
together with a circular to Axiam shareholders containing the details and
financial effects of the redemption on minority shareholders will, subject
to JSE and SRP approvals, be posted to Axiam shareholders within 30 days of
this announcement or such later date as may be approved by the JSE and the
SRP.
Johannesburg
3 September 2001
Sponsor
PSG Investment Bank
Attorneys
FRRW
Fluxman Rabinowitz - Raphaely Weiner Inc. Attorneys
www.frrw.co.za
Independent advisers to minority shareholders
PricewaterhouseCoopers
Corporate Finance (Pty) Ltd
(Registration number 1970/003711/07)
