(Incorporated in the Republic of South Africa)
(Registration number 1997/002203/06)
ISIN: ZAE 0000
Share Code: VLE
DISPOSAL BY VALUE TRUCK RENTAL (PTY) LIMITED (A WHOLLY OWNED SUBSIDIARY OF
VALUE GROUP LIMITED) ("VALUE GROUP") OF ITS FAST MOVING CONSUMER GOODS
("FMCG") CUSTOMER BASE IN THE EASTERN CAPE REGION TO TFD NETWORK AFRICA
(PTY) LIMITED ("TFD")
1. Introduction
The Value Group is authorised to announce that it has concluded a sale
agreement with TFD ("the agreement") in terms of which TFD will acquire
Value Group's customer base in East London and Port Elizabeth in respect of
warehousing and distribution of FMCG's and liquor products ("the disposal"),
subject to the fulfilment of the conditions precedent set out below.
2. The disposal
2.1 Terms of the disposal
In terms of the agreement signed between Value Group and TFD on Monday, 5
November 2001, it was agreed that the cash consideration payable in respect
of the disposal would be R5 million (five million Rand), constisting of an
upfront cash payment of R1 million and thereafter the remaining R4 million
to be paid in equal monthly instalments over a period of 20 months, subject
to certain conditions precedent being fulfilled as detailed in 2.3 below.
2.2 Rationale for the disposal
Value Group has experienced difficulties in procuring critical mass in the
Eastern Cape region, where TFD has already established a footprint in both
the distribution and warehousing of FMCG. Hence the agreement is beneficial
to both parties, with TFD utilising the transportation resources of Value
Group and Value Group utilising TFD's distribution resources for FMCG in the
Eastern Cape.
2.3 The conditions precedent
The disposal is conditional, inter alia, upon the following:
2.3.1 the approval of the disposal by the board of directors of Value
Group, CIC Holdings Ltd (the holding company of TFD) and TFD; and
2.3.2. the approval by the Competition Commission if required.
3. Financial effects of the disposal
The transaction is not expected to have a material effect on earnings or net
asset value per ordinary share.
Isando
7 October 2001
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