| Thu 17 Jan 2002, 0:00 | | Micrologix - Proposed Acquisition Of The Business |
|
Shipping (Proprietary) Limited ("the vendor"), Change of control and Waiver
of mandatory offer
MICROLOGIX LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1998/018118/06)
Share code MRX ISIN ZAE000016911
("Micrologix" or "the company")
PROPOSED ACQUISITION OF THE BUSINESS CONDUCTED BY SPECTRUM SHIPPING
(PROPRIETARY) LIMITED ("the vendor"), Change of control and Waiver of
mandatory offer
1. Introduction
Radagast Capital (Proprietary) Limited is authorised to announce that
Micrologix has entered into an agreement in terms of which it will acquire,
as a going concern, with effect from 1 July 2001, the clearing and
forwarding business conducted by the vendor ("the acquisition"). The
consideration for the acquisition is R6 million to be settled by the issue
to the vendor of 600 million ordinary shares in the company at an issue
price of 1 cent per share.
The agreement between Micrologix and the vendor is subject to the
suspensive conditions set out in paragraph 5 below. In addition,
shareholders of Micrologix are advised that the continued listing of the
company is in the discretion of the JSE Securities Exchange South Africa
("the JSE") and contingent upon the JSE's assessment of the suitability for
listing of the assets being acquired.
2. New nature of business of Micrologix
Micrologix, which will change its name to Spectrum Shipping Limited
("Spectrum Shipping") should the suspensive conditions governing the
acquisition be fulfilled, will operate as a clearing and forwarding
intermediary to local exporters and importers. Spectrum Shipping occupies a
niche position in the clearing and forwarding market as an independent
company with an established track record and well-diversified client base.
The revenue model of Spectrum Shipping exhibits typical rand-hedge qualities
and it is ideally positioned to benefit from the ongoing opening up of the
South African economy.
3. Rationale for the acquisition
Micrologix listed on the JSE in 1998 as a developer of hardware and
software and specifically focused on the development of the Medtel software.
Due to the high cost of development and adverse exchange rates the company
suffered losses and found itself in dire financial straits during 2000. In
October 2000 Gandalf Trust acquired 83 905 461 ordinary shares in the
company (55,94% of the issued share capital) and took effective control.
Gandalf Trust subsequently proposed an offer of compromise to the creditors
of Micrologix in terms of section 311 of the Companies Act, 1973 (Act 61 of
1973), as amended ("the Act"). The offer was accepted by the creditors of
the company and sanctioned by the High Court of South Africa (Transvaal
Provincial Division). Acceptance of the offer resulted in all creditors'
claims being settled and solvency being restored to the company.
Gandalf Trust has negotiated the acquisition in its capacity as
controlling shareholder of the company and is confident that the fortunes of
the company will be restored thereby.
4. Financial effects of the acquisition
The table below illustrates the pro forma effects of the acquisition on
Micrologix earnings as if it had been effective for the 12-month period
ended 31 December 2001. Due to their nature, the pro forma financial effects
may not give a fair reflection of Micrologix after the acquisition.
Unaudited Pro forma
before the after the
acquisition acquisition Percentage Audited
(Note 1) (Note 2) change: (Note 1)
31 Dec 31 Dec increase/ 31 Dec
Description Notes 2001 2001 (decrease) 2000
Earnings/(Loss) per
share (cents) 3 2,7 0,9 (67%) (18,6)
Headline earnings/(loss)
per share (cents) 3 (0,3) 0,2 n a (3,5)
Number of ordinary
shares in issue ('000) 4 150 000 750 000 150 000
Tangible net asset value
per share (cents) 5 4,3 2,4 (44%) 1,4
Net asset value
per share (cents) 5 4,3 2,4 (44%) 1,4
Number of ordinary
shares in issue ('000) 4 150 000 750 000 150 000
Notes:
1 The unaudited figures of Micrologix reflect the figures for the 12 months
ended 31 December 2001. Audited figures for the 12 months ended 31 December
2000 refer to the audited financial statements of Micrologix.
2 The pro forma after acquisition figures include the unaudited figures of
Micrologix before the acquisition, and the unaudited figures for the vendor
for the 12 months ended 31 December 2001. The vendor's unaudited profit
after taxation amounted to R1 962 595.
3 The large difference between the Micrologix unaudited earnings per share
and unaudited headline earnings per share reflects the impact of the section
311 Compromise with creditors.
4 The attributable and headline earnings per share are based on the
assumption that the shares were in issue for the full period, as opposed to
using the weighted average number of shares in issue.
5 The net asset value per share figures (before and after the acquisition)
were derived from the unaudited financial statements (published in the case
of the company) of Micrologix and the vendor for the six months ended 30
June 2001.
5. Suspensive conditions
The acquisition is subject to the following suspensive conditions, all of
which are inserted for the benefit of Micrologix:
5.1 approval of the disposal of the business of Spectrum Shipping by the
shareholders of the vendor in accordance with the provisions of the Act;
5.2 approval of the acquisition by the shareholders of Micrologix in
accordance with the provisions of the Act, which approval will include the
change of name of Micrologix and the reconstitution of the board of
directors of the company; and
5.3 approval of the acquisition and the documentation relating thereto to
the extent necessary by the JSE (including the listing of the additional
ordinary shares to be issued to the vendor in terms of the acquisition), the
Securities Regulation Panel ("the SRP") and any other regulatory
authorities.
6. Change of control and waiver of mandatory offer
Approval and implementation of the acquisition will result in a change of
control of Micrologix which would in the normal course give rise to a
mandatory offer to the minority shareholders of the company in terms of the
Rules of the SRP. Gandalf Trust, the current controlling shareholder, has
however indicated that it will waive its rights to such an offer and a
resolution to this effect will be included in the resolutions to be proposed
at the general meeting of the company referred to below.
7. Salient dates and times
2002
Circular to shareholders posted 15 February
Last date to lodge forms of proxy
for the general meeting (by 10:00) 11 March
General meeting held (at 10:00) 12 March
Results of general meeting published and
second surrender circular issued (the procedure
for surrender will be set out in the circular) 14 March
Last day to trade in Micrologix ordinary shares 20 March
Change of name to Spectrum Shipping Limited
effective from the commencement of trading 22 March
Listing of additional ordinary shares with effect
from the commencement of trading 22 March
Record date 28 March
Posting of new share certificates and safe custody
accounts credited as a result of the change of name 2 April
8. Opinion and recommendation
The directors of Micrologix are unanimously of the opinion that the terms
of the acquisition are fair and reasonable to the shareholders of the
company and recommend that the shareholders vote in favour of the special
and ordinary resolutions required to implement the acquisition.
Those directors of Micrologix who have beneficial interests in the share
capital of the company intend to vote in favour of the resolutions required
to implement the acquisition.
9. Circular to shareholders
A circular to shareholders of Micrologix containing full details of the
acquisition and revised listing particulars and convening a general meeting
of the company will be posted to shareholders within 28 days of this
announcement.
Johannesburg
18 January 2002
Corporate advisers
Radagast Capital
LFS
Lanark Financial Services (Proprietary) Limited
(Registration number 1999/021799/07)
Marwick & Co.
Sponsor
LPC Manhattan Sponsors (Pty) Ltd
(Registration number 1999/024792/07)
Attorneys
Deneys Reitz Attorneys Inc.
Reg. No. 1984/003385/21
Auditors
Compendium Inc.
