| Mon 8 Apr 2002, 0:00 | | Spectrum Shipping Limited - Proposed Acquisition O |
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By CSS Logistics
SPECTRUM SHIPPING LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1998/018118/06)
JSE Share code: SUM ISIN: ZAE000037446
("Spectrum Shipping" or "the company")
PROPOSED ACQUISITION OF THE BUSINESS CONDUCTED BY CSS LOGISTICS
(PROPRIETARY) LIMITED ("CSS Logistics")
1. Introduction
Further to the cautionary announcement published by Spectrum Shipping on
12 February 2002, Radagast Capital (Proprietary) Limited is authorised to
announce that the company has entered into an agreement in terms of which it
will acquire, as a going concern, with effect from 26 February 2002, the
business conducted by CSS Logistics ("the acquisition").
CSS Logistics provides integrated agency services to exporters of fresh
produce world-wide and, in particular, has an agreement to provide such
services to Capespan (Proprietary) Limited ("Capespan") on an exclusive
basis. Capespan is the largest exporter of deciduous and citrus fruit in
Southern Africa.
The consideration for the acquisition is R6 000 000 to be settled by the
issue to CSS Logistics of 75 000 000 ordinary shares in the company at an
issue price of 8 cents per share. In addition, the company will issue 25 000
000 ordinary shares at an issue price of 8 cents per share to key employees
of the business in terms of restraints of trade to be entered into between
such employees and the company.
The agreement between Spectrum Shipping and CSS Logistics is subject to
the suspensive condition that Capespan agrees to cede and assign the
agreement between it and CSS Logistics to Spectrum Shipping and it is
anticipated that this cession and assignment will be finalised by 10 April
2002.
2. Rationale for the acquisition
Spectrum Shipping operates as a clearing and forwarding intermediary to
local exporters and importers. As was stated in the pre-listing statement of
the company issued on 25 February 2002, the clearing business of Spectrum
Shipping constitutes at present approximately 90% of revenue, and the
acquisition, which is in the forwarding business, offers the company a
complementary source of revenue growth with no additional overhead or
developmental costs and with a highly-regarded skills base.
3. Financial effects of the acquisition
The table below illustrates the pro forma effects of the acquisition on the
earnings and asset value per share of Spectrum Shipping as if it had been
effective for the 12-months ended 31 December 2001. Due to their nature, the
pro forma financial effects may not give a fair reflection of the company
after the acquisition.
Pro forma Pro forma
before the after the Percentage
acquisition acquisition change:
(Note 1) (Note 2) increase/
Description Notes 31 Dec 2001 31 Dec 2001 (decrease)
Earnings per share (cents) 0,8 0,9 12,5
Headline earnings
per share (cents) 0,2 0,4 100
Number of ordinary shares
in issue ('000) 3 750 000 850 000
Tangible net asset value
per share (cents) 2,6 2,5 (3,8)
Net asset value
per share (cents) 2,6 2,5 (3,8)
Number of ordinary shares
in issue ('000) 3 750 000 850 000
Note 1
The pro forma before the acquisition figures consolidate the audited figures
of the former Micrologix Limited and the audited figures of the business of
Spectrum Shipping Company (Pty) Ltd for the 12 months ended 31 December
2001.
Note 2
The pro forma after the acquisition figures combine the pro forma before the
acquisition figures with the audited figures of CSS Logistics for the 12
months ended 31 December 2001 as if the acquisition had been effective at 1
January 2001. The audited profit after taxation of CSS Logistics amounted to
R1 272 025.
Note 3
The earnings and net asset value per share figures 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.
By order of the board
D C Kelly
Chief Financial Officer
Mount Edgecombe
9 April 2002
Corporate adviser
Radagast Capital
Sponsor
LPC Manhattan Sponsors (Pty) Ltd
(Registration number 1999/024792/07)
