| Wed 11 Sep 2002, 18:04 | | Caxton/ Ctp Holdings - Proposed Scheme Of Arrangem |
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Caxton/ CTP Holdings - Proposed Scheme of Arrangement
CAXTON PUBLISHERS AND PRINTERS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1947/025989/06)
SHARE CODE: CXT ISIN: ZAE000017182
("Caxton")
CTP HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1947/026616/06)
SHARE CODE: CTP ISIN: ZAE000001871
("CTP")
PROPOSED SCHEME OF ARRANGEMENT TO CONSTITUTE CAXTON AS A WHOLLY-OWNED
SUBSIDIARY OF CTP
1. The scheme
1.1 Further to the cautionary announcement dated 6 September 2002, PSG
Investment Bank is authorised to announce that CTP, the holder of 79,4% of the
issued share capital of Caxton, will propose a scheme of arrangement in terms of
section 311 of the Companies Act, 1973 (Act 61 of 1973), as amended ("the
scheme") between Caxton and its shareholders other than CTP ("scheme members"),
which on implementation will result in:
- Caxton becoming a wholly-owned subsidiary of CTP;
- the listing of Caxton on the JSE Securities Exchange South Africa ("the JSE")
being terminated.
1.2 In terms of the scheme, the consideration payable to scheme members will be:
- a cash payment of 410 cents per Caxton share ("the cash consideration").
Scheme members receiving the cash consideration will also receive the dividend
of 16 cents per share declared by Caxton for the year ended 30 June 2002; or
- if so elected, shares in CTP in the ratio of 8,1 CTP shares for every 100
Caxton shares held ("the share alternative"). Scheme members receiving the
share alternative will also receive the dividend of 16 cents per share declared
by Caxton for the year ended 30 June 2002 but will not be entitled to receive
the dividend declared by CTP for the year then ended.
1.3 The approval and implementation of the scheme is subject to:
- the scheme being approved by a majority representing three-fourths of the
votes exercisable by scheme members present and voting either in person or by
proxy at a meeting of scheme members;
- the scheme being sanctioned by the High Court of South Africa (Witwatersrand
Local Division) and the Order of Court being lodged with, and registered by, the
Registrar of Companies;
- the passing by CTP shareholders of a special resolution to increase CTP`s
authorised share capital for CTP to have sufficient unissued shares to satisfy
the share alternative; and
- receipt of the necessary regulatory approvals including, to the extent
required, approvals from the JSE, the Securities Regulation Panel ("SRP") and
the South African Reserve Bank.
1.4 Caxton shareholders representing 66% of scheme members have given
irrevocable undertakings to vote in favour of the scheme and to elect the share
alternative.
1.5 The SRP has been provided with confirmation that CTP is able to satisfy the
cash consideration taking into account the undertakings referred to in 1.4.
2. Rationale for the scheme
The implementation of the scheme:
- will simplify the CTP group structure by eliminating the pyramid shareholding
structure and reducing the entry points into the CTP group;
- will save the cost of maintaining Caxton as a separately listed company, the
benefits of which are restricted by the small public free float of shares which
is well below the 20% public shareholder spread which has become mandatory in
terms of the Listings Requirements of the JSE;
- will afford scheme members receiving the cash consideration the opportunity to
realise their shares at a premium to the prevailing market price; and
- will enhance the tradeability of CTP shares and afford scheme members electing
the share alternative the benefit of greater tradeability of the CTP shares they
will receive over their Caxton shares.
3. Pro forma financial effects of the scheme
The pro forma financial effects of the scheme on CTP and scheme members are
presented below for illustrative purposes only and are based on the published
results of Caxton and CTP for the year ended 30 June 2002 and, in the case of
the effects on earnings on the assumption that the scheme took place on 1 July
2001 and in the case of the effects on net asset value, that the scheme was
effective on 30 June 2002.
3.1 On CTP
Before(1) After(2)
(cents (cents Change
per share) per share) (%)
Adjusted headline earnings 517 527 2
Headline earnings 487 495 2
Earnings 489 430(3) (12)
Net asset value 4 410 4 356 (1)
Net tangible asset value 4 410 4 280 (3)
Shares in issue (millions) 37,1 43,5 N/A
Notes:
(1) Extracted from the published results of CTP for the year ended 30 June 2002.
(2) Assumes that 66% of scheme members receive the share alternative and the
balance of scheme members the cash consideration.
(3) Goodwill of R33,4m arising in terms of the scheme has been written off
against earnings.
3.2 On scheme members
After After
cash share
Before(1) consideration alternative
(cents (cents Change (cents Change
per share) per share) (%) per share) (%)
Adjusted headline earnings 41 36(4) (12) 43(3) 5
Headline earnings 38 36(4) (5) 40(3) 5
Earnings 42 36(4) (15) 35(3) (17)
Net asset value 328 410 25 353(3) (8)
Net tangible asset value 328 410 25 347(3) 6
Market price (2) 350 410 17 381 9
Notes:
(1) Extracted from the published results of Caxton for the year ended 30 June
2002.
(2) Based on the market price of CTP and Caxton shares on 5 September 2002,
being the last practicable trading date before the publication of the cautionary
announcement on 6 September 2002.
(3) Based on the pro forma earnings and net asset value per CTP share after the
scheme set out in 3.1 above.
(4) Assumes that scheme members reinvest the cash consideration to yield 8,5%
after tax.
4. OPINIONS AND RECOMMENDATIONS
In terms of the SRP Code on Take-overs and Mergers, the board of directors of
Caxton will appoint an independent adviser to report on whether the terms and
conditions of the scheme are fair and reasonable.
The board of Caxton, on receipt of the report required of the independent
advisers, will make appropriate recommendations to scheme members.
5. DOCUMENTATION AND SALIENT DATES
Further details of the above will be included in circulars to CTP and Caxton
shareholders, incorporating notices of the general and scheme meetings
respectively, which will be posted to shareholders of CTP and Caxton within 30
days of this announcement.
Salient dates in relation to the scheme will be published prior to the issuing
of any of the abovementioned documentation.
Johannesburg
12 September 2002
Corporate adviser and sponsor
PSG INVESTMENT BANK
Attorneys
FLUXMANS ATTORNEYS
Date: 11/09/2002 05:05:00 PM Produced by the JSE SENS Department
