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Rebecca Price Trust
RULING OF THE SECURITIES REGULATION PANEL
("the Panel")
In Re:
The Appeal by
MGX Holdings Limited
and
the Trustees of the Mandy Rebecca Price Trust
Appellants
against the ruling of the Executive Committee
of the Panel dated 5 July 2001 and 7 August 2001
Respondent
1. Having heard evidence and considered the oral and written submissions of
the parties, the Panel rules unanimously that the Appellants were acting in
concert for the purposes of entering into an affected transaction.
Accordingly the Appeal is dismissed.
2. The Appellants are ordered jointly and severally forthwith to make an
unconditional offer to all persons other than the two Appellants who were
shareholders of EC Hold Limited on 11 October 1999 to purchase all such
persons' shares in EC Hold Limited. The offer price shall be R2,40 per share
and the offer shall in all other respects comply with Section F Rule 8 of
the Panels' Rules and Code and all other applicable rules of the Panels'
Rules and Code.
3. The matter of the costs of the Panel was raised but not argued by the
parties during the course of proceedings before the Panel and to avoid
further delays the Panel orders that its costs and the costs of the
Executive Committee whose decision was taken on Appeal shall be paid by the
Appellants jointly and severally but either the Appellants or the Executive
Committee shall be entitled for a period of 10 business days to require the
Panel to hear argument why that order for costs should be varied.
N.B The attention of persons referred to in the above orders who ceased to
be shareholders of EC Hold Limited on or after 11 October 1999, and of the
Appellants, is directed to the provisions of Section 440M(4) of the
Companies Act No. 61 of 1973 as amended, which reads as follows:
"440M(4)
Any person who contravenes any of the rules shall be liable to any other
person for any loss or damage suffered by that person as a result of such
contravention."
It will be advisable for interested parties to consult their legal advisors
as to their respective rights and obligations.
Dated at Johannesburg this 18th day of March 2002.
Chairperson
C A JAFFE'
MGX Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number 1983/012697/06
Share code: MGX ISIN: ZAE000009262
("MGX")
ANNOUNCEMENT BY MGX
MGX has been informed that the Securities Regulation Panel ("the Panel")
today dismissed MGX's appeal against the decision of the Executive Committee
consisting of three persons of the Panel, that MGX and the MRP Trust acted
in concert in the acquisition of shares in EC Hold Limited ("EC Hold"). No
reasons for this current decision were supplied by the Panel, as MGX is
advised it should have done. The Panel's ruling relates to the Rules
contained in the Securities Regulation Code on Take-Overs and Mergers.
The Board of Directors of MGX maintain its position that no concert party
activity occurred with respect to share dealings in EC-Hold shares. MGX will
therefore continue to consider its alternative courses of action, taking all
of its stakeholders into consideration. Should the Panel decide to proceed
with the matter and to institute proceedings in the High Court, MGX and its
legal advisors are confident that the High Court will exercise proper
judicial discretion, according to appropriate laws of process and evidence,
in considering the facts.
For information only, MGX advises that in terms of this current ruling,
should the Panel succeed in requiring MGX to offer to purchase shares of EC
Hold at a higher price, the increase in the purchase price of this
investment is likely to be less than the R30 million previously noted, and
should not materially affect the business of MGX.
Midrand
19 March 2002
Merchant bank and sponsor
Standard Corporate and Merchant Bank
(A division of The Standard Bank of South Africa Limited)
(Registration number 1962/000738/06)
Attorneys
Knowles Husain Inc Attorneys
(Registration number 2000/000004/21)
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