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THE ACQUISITION OF A 34,9% INTEREST IN NAMIBIAN SEA PRODUCTS LIMITED
NAMIBIAN FISHING INDUSTRIES LIMITED
(Incorporated in the Republic of Namibia)
(Registration number 342/1947)
South African share code: NFH
Namibian share code: NMF
(ISIN: NA0008640220)
ANNOUNCEMENT WITH REGARDS TO THE ACQUISITION OF A 34,9% INTEREST IN NAMIBIAN SEA
PRODUCTS LIMITED
1. INTRODUCTION
Shareholders are advised that agreement has been reached between Namibian
Fishing Industries Limited ("Namfish") and Mr Peter Clark Kuttel ("Kuttel"), in
terms of which Namfish will acquire 34,9% of the entire issued share capital of
Namibian Sea Products Limited ("Namsea") ("the Acquisition") from Kuttel as
detailed in 3 below.
BACKGROUND AND RATIONALE
Namsea operates in the pelagic fishing industry in Namibia and Angola and is
listed on the JSE Securities Exchange South Africa ("JSE") and the Namibian
Stock Exchange ("NSX").
It operates a pilchard canning plant and fishmeal factory in Walvis Bay and its
fleet of vessels has contractual agreements with other pelagic concessionaires
in Namibia for providing fish to the Namsea factory.
Namsea`s vessels are also licensed to catch pelagic species in Angolan waters,
for delivery to a fishmeal factory at Tombwa in Southern Angola.
Namfish operates in the white fish industry in Namibia and this transaction
will, inter alia, give it access to the pelagic and midwater horse mackerel
industries.
The pelagic industry was negatively affected during the last five years as
pilchards were not in abundance and no or few quotas were given. Namfish
estimates that Namsea will gain considerably from any increase in the pilchard
quota.
The pelagic industry in Namibia experienced an excellent season in respect of
industrial fish used for fishmeal production. The product is high in demand and
there was a considerable increase in price during the past year. It is expected
that Namsea can earn considerable income from this source.
The entrenchment of Namsea and establishment of Namfish in the Angolan fishing
industry will allow both companies to earn foreign currency.
Namfish only acquired 34.9% of all the issued shares in Namsea and does not at
this stage intend to make an offer to other shareholders or increase its
shareholding in excess of 35%.
Certain directors of Namfish and persons associated with Namfish collectively
hold an interest of approximately 6% in Namsea.
SALIENT TERMS OF THE ACQUISITION
The minimum price payable to Kuttel for the acquisition is N$24 402 488 which
equates to 60c per share ("the initial consideration"), which purchase
consideration is subject to upwards adjustment ("the deferred consideration"),
based on the earnings per share of Namsea for the two years ending on 31
December 2004. The deferred consideration is payable in cash on 31 March 2005.
The initial consideration will be paid in cash immediately after approval by the
shareholders of Namfish of the transaction and against transfer of the relevant
share certificates.
FINANCIAL EFFECTS OF THE ACQUISITION
Had the transaction been implemented on 1 January 2001, the effect of the
acquisition on the earnings per share ("EPS") for the sixteen months ended 30
April 2002 and the net asset value per share ("NAV") and tangible net asset
value ("NTAV") of Namfish as at 30 April 2002 would have been as follows:
Before After Percentage
change
cents cents
EPS 23.9 25.3 5.9
NAV 158.9 158.9 -
TNAV 86.8 86.8 -
Notes:
The EPS in the after column is based on Namsea`s past twelve months earnings up
to 30 June 2002 expressed in sixteen months;
The EPS in the after column further assumed 1 500 000 Euro loan funding for the
transaction at 4% per annum and the remainder in the form of own cash and local
funding;
The NAV and TNAV calculation in the after column was based on the fact that the
stake in Namsea will be equity accounted.
CONDITIONS PRECEDENT
The agreement is conditional upon obtaining the requisite approval from the
Namfish shareholders in general meeting and approval of the NSX and the JSE.
Shareholders holding 67% of the issued share capital of Namfish have irrevocably
undertaken to vote in favour of the acquisition.
DOCUMENTATION
A detailed circular to Namfish shareholders containing details of the
transaction and notices convening the required meeting of shareholders will be
mailed to shareholders within 28 days or such later date as approved by the NSX
and the JSE.
Walvis Bay
11 October 2002
Sponsor to Namfish in SA Sponsor to Namfish in Namibia
PSG Capital Investment House Namibia
Date: 10/10/2002 05:05:00 PM Produced by the JSE SENS Department
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