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ordinary shares in NAC on the open market
New Africa Capital Limited
(Incorporated in the Republic of South Africa)
(Registration number 2000/031756/06)
(Share code: NAC ISIN: ZAE000033130)
("NAC" or "the Company")
Repurchase of a further 3% of the issued ordinary shares in NAC on the open
market
1. Repurchase
The directors of NAC are authorised to announce the purchase by its wholly-
owned subsidiary company, Metropolitan Life Limited ("Metropolitan"), of an
additional 22 105 259 of the Company's ordinary shares as Treasury Stock on
the open market during the period 30 October 2001 to 4 January 2002. This
represents 3.04% of the total issued ordinary share capital of the Company
at the date of the listing of NAC, being the date on which the general
authority to repurchase shares ("the Authority Date") became effective for
the purposes of the Listing Requirements of the JSE Securities Exchange
South Africa ("JSE").
As announced on 23 October 2001, Metropolitan acquired 1.56% of the
issued share capital of NAC during the period 28 September 2001 to 22
October 2001.
In addition to this Treasury Stock, the Insurance subsidiaries in the NAC
group cumulatively hold 4.38% of the total issued share capital of NAC on
behalf of their policyholders, in terms of Section 32(2) of the Long-Term
Insurance Act, 1998.
2. Details of the cumulative share repurchases (Treasury Stock)
The details of the cumulative share repurchases between 28 September 2001
and 4 January 2002 are set out below:
Number of ordinary shares repurchased 33 490 559
Repurchase as a percentage of total trade in NAC shares 34.14%
Percentage of the Company's issued ordinary shares
at the Authority Date 4.60%
Total value of ordinary shares purchased R279 550 460
Highest value paid per ordinary share purchased 885 cents
Lowest value paid per ordinary share purchased 745 cents
Number of ordinary shares which may still be repurchased
by the Company in terms of the general authority 80 208 205
Percentage of the Company's issued ordinary shares
which may still be repurchased by the Company
in terms of the general authority 11.02%
Number of ordinary shares which may still be repurchased
by subsidiaries of NAC (on behalf of either shareholders
or policyholders) 7 430 157
Percentage of the Company's issued ordinary shares
which may still be repurchased by subsidiaries
(on behalf of either shareholders or policyholders) 1.02%
3. Source of funds
The share repurchases were implemented using funds generated in the ordinary
course of business.
4. Directors' opinion
The directors of NAC have considered the effects of the share repurchases
and are unanimously of the opinion that, for a period of 12 months after the
date of this announcement:
* the Company and its subsidiaries will be able to meet their debts in the
ordinary course of business;
* the assets of the Company and its subsidiaries, fairly valued in
accordance with Generally Accepted Accounting Practice, will remain in
excess of the liabilities of the Company and its subsidiaries;
* the issued capital and reserves of the Company and its subsidiaries are
adequate for the purposes of the business;
* the working capital available to the Company and its subsidiaries is
sufficient for the Company and its subsidiaries.
5. Pro forma financial effects of the repurchases
The table below sets out the financial effects of the repurchase of 4.60% of
NAC's issued ordinary share capital:
Before the After the Increase/
repurchases repurchases (Decrease)
(cents) (cents) %
Earnings per share 34,02 35.12 3.2
Headline earnings per share 36,78 38.01 3.4
Embedded value per share 1 066 1 077 1.0
Tangible net asset value per share 737 732 (0,6)
Assumptions:
1. The pro forma financial effects on the NAC group are calculated based on
the results for the six months ended 30 June 2001, assuming that the
purchases to date had been carried out on 1 January 2001. The accounting
policies employed by NAC for the six months ended 30 June 2001 have been
applied in making these calculations.
2. The pro forma adjustments assume that the ordinary shares had been
repurchased with funds realized from the sale of equities on which there
would have been a loss of investment income, calculated at an after-tax rate
of 2.7% per annum.
3. The shares held on behalf of policyholders are not eliminated on
consolidation, and thus have no effect on the group results.
6. JSE listing
The shares have been acquired by Metropolitan, a wholly-owned subsidiary of
NAC, to be held on behalf of shareholders as Treasury Stock. Accordingly,
the shares will continue to be listed on the JSE.
7. Rationale
The repurchase of shares by NAC forms part of its capital management
programme to ensure that surplus capital is efficiently deployed.
NAC will continue to consider, and if appropriate, conduct further
repurchases in order to manage the level of capital in the NAC group.
Bellville
7 January 2002
Financial adviser to NAC
Deutsche Securities
Member of the Deutsche Bank Group
Deutsche Securities (SA) (Proprietary) Limited
(Registration number 1995/011798/07)
Sponsor to NAC
AMB
African Merchant Bank Limited
Registered Bank
Registration number 1996/016470/06
Sponsor to NAC in Namibia
Lexus Securities (Pty) Ltd
Colin van Zyl
Member of the Namibian Stock Exchange
Trading as Lexus Securities
Legal adviser to NAC
Deneys Reitz Attorneys Inc.
Reg. No. 1984/003385/21
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