| Fri 13 Mar 2020, 17:26 | | HULAMIN LIMITED - HLM : Transaction by a wholly owned subsidiary |
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HLM : Transaction by a wholly owned subsidiary:
HULAMIN LIMITED
(Incorporated in the Republic of South Africa)
Registration number 1940/013924/06
JSE Code: HLM
ISIN: ZAE000096210
("Hulamin" or "the Company")
Transaction by a wholly owned subsidiary
1. Introduction
Hulamin through its wholly owned subsidiary, Hulamin Extrusions Proprietary Limited, ("Hulamin
Extrusions" or "the Seller"), entered into an agreement with Pioneer Metals Proprietary Limited
("Pioneer" or the "Purchaser") on 11 March 2020 ("the Agreement") whereby the Purchaser will
purchase immovable property described as Erf 7733, Clayville, Gauteng held under title deed number
T177688/2016, measuring 6,9619 hectares, situated at 1 Westview Road, Clayville, together with all
buildings, fixtures and fittings of a permanent nature, as well as equipment and spares ("the Sale
Assets") as set out in the Agreement, from the Seller ("the Transaction").
The effective date of the Transaction is expected to be on transfer of the property with the relevant
deeds office.
The Agreement contains warranties that are usual for transactions of this nature.
2. Rationale for the Transaction
Following a strategic review of the Hulamin Extrusions business it was decided to cease operations at
the Olifantsfontein plant and consolidate the business on one site in order to enhance the profitability
of the business. The disposal of the Olifantsfontein operation follows from the closure of the plant.
3. Nature of the businesses of the Seller and the Buyer
3.1 Hulamin Extrusions
Hulamin Extrusions is a leading local supplier of standard and custom aluminium extrusions for use
largely in the engineering and architectural markets.
3.2 Pioneer
Pioneer is a manufacturer copper alloy, brass and bronze casting products.
4. Conditions precedent
The Transaction is subject to the fulfilment and/or waiver, where appropriate, of certain conditions
precedent including, inter alia:
- the necessary consents, with or without conditions, having been obtained from the South African
Competition Commission or the South African Competition Tribunal within 120 business days from
the date of signature of the Agreement; and
- the Purchaser obtaining a bank guarantee in the usual form for transactions of this nature, payable
free of commission to the Seller for the sum of R54 million within 45 days from the date on which
the above condition is fulfilled.
5. Consideration
The purchase price payable by the Purchaser to the Seller in respect of the Sale Assets is a total cash
consideration of R55 million (exclusive of VAT). A deposit of R1 million is payable within 7 days from
the date of signature of the Agreement.
6. Financial information
The net asset value of the Sale Assets as at 30 June 2019 is R16.636 million. This information has
been extracted from Hulamin's unaudited interim financial results for the period ended 30 June 2019
and has been prepared in accordance with International Financial Reporting Standards.
7. Application of sale proceeds
The cash proceeds from the disposal of the Sale Assets will be applied by the Company to reduce debt
levels and fund working capital.
8. JSE Classification of the Transaction
The Transaction is categorised as a category 2 transaction in terms of the JSE Listings Requirements
and accordingly is not subject to approval by the shareholders of the Company. There are no related
parties involved in the Transaction.
Pietermaritzburg
13 March 2020
Sponsor
Questco Corporate Advisory Proprietary Limited
Date: 13-03-2020 05:27:00
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