| Tue 23 Oct 2001, 0:00 | | Fintech / Altron - Proposed Scheme Of Arrangement |
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Fintech Limited
(Incorporated in the Republic of South Africa)
(Registration number 1969/010524/06)
Share code FIN
ISIN code ZAE000015244
("Fintech")
Allied Electronics Corporation Limited
(Incorporated in the Republic of South Africa)
(Registration number 1947/024583/06)
Share code ATN
ISIN code ZAE000029658
("Altron")
Proposed scheme of arrangement
1. Introduction
Further to the cautionary announcement of Fintech published on Thursday 11
October 2001, Fintech shareholders are advised that the directors of Altron
have resolved to procure that Altron propose a scheme of arrangement ("the
scheme") in terms of Section 311 of the Companies Act, No 61 of 1973, as
amended ("the Act") between Fintech and its shareholders other than Altron
("scheme members") in terms of which, subject to fulfilment of the
conditions precedent referred to in 4, Fintech shareholders registered as
such on Wednesday 12 December 2001 ("scheme participants") will receive 290
cents in cash for each share held in Fintech ("cash consideration"). The
scheme, if implemented, will result in Fintech becoming a wholly-owned
subsidiary of Altron.
The cash consideration represents a premium of 26,1% to the closing JSE
Securities Exchange South Africa ("the JSE") market price of a Fintech share
on Wednesday 10 October 2001, being the day immediately preceding the
publication of the cautionary announcement.
Fintech has applied to the JSE to, subject to the implementation of the
scheme:
- suspend the listing of Fintech on the JSE from the commencement of trade
on Thursday 6 December 2001; and
- terminate the listing of Fintech on the JSE with effect from the
commencement of trade on Thursday 13 December 2001.
2. Rationale for the scheme
The sale of Fintech's technology assets to Bytes Technology Group Limited,
formerly Usko Limited ("BTG") in February 2001 and the subsequent unbundling
of Fintech's shares in BTG resulted in the streamlining of Fintech's
business into a focused financial services business. These transactions also
resulted in a significant reduction in the scale of Fintech's business
operations. With the market's aversion to smaller capitalisation companies,
the costs associated with an ongoing listing of Fintech and Altron's
refocusing of a number of its group operations coupled with its stated
objective of reducing the number of entry points into the Altron group, both
Fintech and Altron no longer see benefit in retaining Fintech's listing on
the JSE.
3. Meeting to be held in regard to the scheme
In order to obtain the approval of scheme members for the scheme, a meeting
of scheme members will be held in the Rand Room, Level 3, Nedcor Investment
Bank Limited, 1 Newtown Avenue, Killarney, Johannesburg at 09:00 on Tuesday
27 November 2001 ("scheme meeting").
4. Conditions precedent
The scheme is subject to fulfilment of the following conditions precedent,
namely:
- the scheme being approved by a majority representing not less than 75% of
the votes exercisable by scheme members present and voting either in person
or by proxy at the scheme meeting;
- the High Court of South Africa (Transvaal Provincial Division) ("the
Court") sanctioning the scheme in terms of the Act; and
- a certified copy of the Order of Court sanctioning the scheme being
registered by the Registrar of Companies in terms of the Act.
As Altron already beneficially owns 64,35% of Fintech's issued share
capital, directly and indirectly, in terms of section 12(2) of the
Competition Act, No 89 of 1998, no notification to the Competition
Commission is required.
5. Salient dates and times
The following are the expected dates and times regarding the scheme:
2001
Last day to trade in order to be
registered as a shareholder of Fintech
in order to vote at the scheme meeting,
by close of trade on the JSE on Thursday 15 November
Last day for being registered as a
shareholder of Fintech in order to vote
at the scheme meeting, by close of trade
on the JSE on Thursday 22 November
Last day to lodge forms of proxy
for the scheme meeting, by 09:00 on Friday 23 November
Scheme meeting held at 09:00 on Tuesday 27 November
Announcement of results of scheme
meeting and final data published on Wednesday 28 November
Court hearing to sanction the scheme
expected at 10:00 or as soon thereafter
as Counsel may be heard on Tuesday 4 December
Expected last day to trade in shares
of Fintech on the JSE in order to be
registered on the record date of the scheme Wednesday 5 December
Expected date for the suspension of
Fintech's listing on the JSE, from
commencement of trade on the JSE on Thursday 6 December
Expected record date to participate
in the scheme Wednesday 12 December
Expected operative date of the scheme Thursday 13 December
Expected date for termination of
Fintech's listing on the JSE, from
commencement of trade on the JSE on Thursday 13 December
Expected date from which the cash
consideration will be
made available to scheme members Thursday 13 December
Notes:
1. Any variation of the above dates and times, approved as necessary by the
JSE, Securities Regulation Panel ("SRP") and/or the Court, will be advised
by notification on SENS and in the press.
2. Fintech shareholders should note that, as Fintech is trading in the
STRATE environment, settlement for trade takes place five business days
after such trade. Therefore, Fintech shareholders who acquire Fintech shares
on the JSE after Thursday 15 November 2001 will not be eligible to vote at
the scheme meeting.
3. Dematerialised shareholders must provide their Central Securities
Depository Participant ("CSDP") with their instructions for voting or
attendance at the scheme meeting in terms of the custody agreement entered
into between the shareholders and the CSDP.
4. No dematerialisation of Fintech share certificates will take place from
Wednesday 5 December 2001.
6. Financial effects of the scheme
The table below sets out the pro-forma effects of the scheme on the market
value, dividend headline earnings and net tangible asset value attributable
to scheme participants:
Before After
Cents Cents percentage
Notes per share per share change
Market value 1 230,0 290,0 26,1
Market value 2 261,0 290,0 11,1
Dividend 3 10,0 20,6 106,0
Headline earnings 4 16,1 9,4 (41,7)
Net tangible
asset value 5 137,3 290,0 111,2
Notes:
1. The "Before" column is the closing JSE market price of a Fintech share on
Wednesday 10 October 2001, being the day immediately preceding the
publication of the cautionary announcement. The "After" column shows the
cash consideration.
2. The "Before" column is the closing JSE market price of a Fintech share on
Monday 22 October 2001, being the day immediately preceding publication of
this announcement. The "After" column shows the cash consideration.
3. The "Before" column represents the dividend paid by Fintech for the 12
months ended 28 February 2001. The "After" column reflects the after-tax
interest income, at an average tax rate of 30%, that a scheme participant
would have earned had the cash consideration been invested at an interest
rate of 10,15%, based on the average rate of interest earned on a twelve
month fixed deposit for the 12 months ended 28 February 2001.
4. The "Before" column is the unaudited headline earnings per Fintech share
calculated on the 125 665 580 shares in issue in Fintech for the 6 months
ended 31 August 2001. The "After" column reflects the after-tax interest
income, at an average tax rate of 30%, that a scheme participant would have
earned had the cash consideration been invested at an interest rate of
9,25%, based on the average rate of interest earned on a 6 month fixed
deposit for the 6 months ended 31 August 2001.
5. The "Before" column is the net tangible asset value per Fintech share
calculated on the 125 665 580 shares in issue at 31 August 2001. The "After"
column shows the cash consideration.
7. Opinions, recommendations and undertakings
Standard Corporate and Merchant Bank, a division of The Standard Bank of
South Africa Limited ("SCMB"), acting as independent financial adviser to
the board of directors of Fintech, has considered the terms and conditions
of the scheme and is of the opinion that, at the date of issue of its
letter, they are fair and reasonable to scheme members and has advised the
directors of Fintech accordingly.
The board of directors of Fintech has considered the terms and conditions of
the scheme and, taking into account the opinion of SCMB, is of the unanimous
opinion that the terms and conditions thereof are fair and reasonable to
scheme members and recommend that scheme members vote in favour of the
scheme at the scheme meeting. Those directors of Fintech who own shares in
their own right intend to vote such shares in favour of the scheme.
It should be noted that Messrs PD Redshaw, GM Rochussen, RE Venter and PL
Wilmot are directors of both Fintech and Altron. Mr IP Pennel, Fintech's
Chief Executive Officer, is a member of the Altron Executive Committee.
Scheme members holding in aggregate 81,0% of the scheme members' shares have
given written irrevocable undertakings to vote in favour of the scheme at
the scheme meeting.
8. Confirmation of financial resources
Nedbank, a division of Nedcor Bank Limited, has confirmed to the SRP that
sufficient financial resources are available to Altron to ensure that it is
able to honour its financial commitment in terms of the scheme.
9. Circular to shareholders of Fintech
A circular, which is subject to the prior approval of the SRP and JSE,
providing full information on the scheme and containing, inter alia, notice
of the scheme meeting, is being prepared and is expected to be posted to
shareholders of Fintech on or about Friday 2 November 2001.
Johannesburg
23 October 2001
Merchant bank and independent financial adviser to Fintech
Standadard Corporate and Merchant Bank
(A Division of The Standard Bank of South Africa Limited)
(Registration number 1962/000738/06
Investment bank to Altron
Nedcor
Investment Bank
Corporate law advisers and consultants
Edward Nathan & Friedland
Corporate law advisers & consultants
Joint sponsors to Fintech and Altron
Nedcor
Investment Bank
ENF Sponsors (Pty) LTD
(Registration number 2000/027636/07)
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