| Fri 22 Nov 2002, 14:55 | | Good Cape - Announcement |
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Good Cape - Announcement
GOOD CAPE LIMITED
(Incorporated in the Republic of South Africa)
(Registration No. 1987/006274/06)
Share Code: GDC ISIN no: ZAE000015590
("Good Cape" or the "Company")
DISPOSALS OF SUBSIDIARY COMPANIES AND ASSETS; DISTRIBUTION TO
SHAREHOLDERS BY WAY OF REDUCTION OF SHARE CAPITAL; CHANGE IN CONTROL AND
FURTHER CAUTIONARY ANNOUNCEMENT
1. INTRODUCTION
Further to the cautionary announcement dated 21 October 2002, the
Company announces that it entered into an agreement dated 22 October
2002, as amended and novated (the "Agreement") pursuant to which and
subject to the suspensive conditions set out in paragraph 7 below (the
"Suspensive Conditions"):
1.1 it and its subsidiaries shall dispose of certain assets and
liabilities to Rabfam Trading (Proprietary) Limited ("Rabfam") for a net
consideration of R3 663 000, subject to any adjustment in terms of
paragraph 6.2 below (the "Rabfam Sale");
1.2 Bellcanto Controlling Interests (Proprietary) Limited ("BCI"), a
wholly owned subsidiary of the Company, entered into an agreement (the
"Bellcanto Agreement") in terms of which BCI shall dispose of the entire
issued share capital and all claims it has against Bellcanto
(Proprietary) Limited ("Bellcanto") to a consortium comprising BoE
Corporate, a division of BoE Bank Limited, G B Rubenstein, A B
Rubenstein, J A M Mackay, P J A Blanckenberg and G F Porteus (the
"Consortium") for a consideration of R3 400 000;
1.3 it shall make a cash distribution (the "Distribution") to its
shareholders by way of a payment in reduction of share premium in terms
of section 90 of the Companies Act 61 of 1973, as amended (the "Act"),
of 34,27 cents per ordinary share in the Company ("Share"); and
1.4 there will be a change in control of the Company in that Abbey
Propcor Holdings Limited ("Abbey") will sell to Edge to Edge 188
(Proprietary) Limited ("Edge to Edge"), 18 376 173 Shares in the Company
(the "Sale Shares") constituting 58,053% of the total issued share
capital of the Company for a purchase consideration of 10,125 cents per
Share (the "Sale"). The Sale purchase consideration shall be payable on
the closing date of the Sale (the "Sale Closing Date") which shall be
the later of; the third business day after the fulfilment of the last of
the Suspensive Conditions; and the business day immediately following
the day on which the Shares trade on the JSE Securities Exchange South
Africa ("JSE") ex the Distribution.
Pursuant to the change in control arising from the Sale, Edge to Edge
has undertaken and is required in terms of the Securities Regulation
Code on Mergers and Take overs ("the Code") to, after implementation of
the Sale, make a corresponding offer to acquire the Shares of the
minority shareholders for 10,125 cents per Share (the "Offer").
Accordingly, should all the Suspensive Conditions be fulfilled,
shareholders of the Company will be entitled to the Distribution of
34,27 cents per Share and, shareholders accepting the Offer, to a
purchase consideration of 10,125 cents per Share, being a potential
aggregate amount of 44,395 cents per Share.
2. RATIONALE
As indicated in the Company`s 2002 annual report, the board
considers that it is unlikely the Company will be able to maintain its
primary listing on the JSE in view of the Company`s diminishing property
portfolio; the ongoing costs of being listed on the JSE; and that in
order to maintain a primary listing it will be necessary, by October
2003, to have at least R30 000 000 in equity capital with a pre-tax
profit of R8 000 000. Accordingly, the board considers the Rabfam Sale
and Bellcanto Agreement (collectively the "Disposals") and Distribution
as providing shareholders with an opportunity to realise their
investment.
3. THE RABFAM SALE
Rabfam shall in effect acquire all assets and assume all
liabilities of the Company and its various subsidiaries, other than:
3.1 the Company`s shares in its wholly owned subsidiary Good Cape
(Albert Road) Holdings Limited ("Albert Road"), which owns certain
property at 251 Albert Road, Woodstock, Cape Town; and
3.2 the assets and liabilities to be retained by Bellcanto described
in paragraph 4.1 below and the companies retained by the Company as set
out in paragraph 4.2 below.
4. BELLCANTO AGREEMENT
4.1 In terms of the Bellcanto Agreement BCI shall sell to the
Consortium the entire issued share capital of and all of its claims
against Bellcanto. The Bellcanto Agreement is subject to the Rabfam
Sale and after implementation, Bellcanto shall essentially only hold the
following material assets:
4.1.1 its 50% shareholding in Bellcanto (Croydon) Nominees Limited
which owns San Croy Business Park, Croyden; and
4.1.2 37,5% joint venture interests in certain serviced and
unserviced sites in Bedfordview, Johannesburg.
4.2 After implementation of the Disposals and the Distribution, the
Company shall essentially retain the following subsidiaries: Albert
Road; Good Cape (Epping) Holdings Limited; Good Cape Group Limited and
BCI. Except for Albert Road, none of these subsidiaries will retain any
material assets.
5. RELATED PARTY TRANSACTIONS
As B P Rabinowitz (a director of the Company) has an indirect
beneficial interest in Rabfam and Abbey, they are related parties in
terms of the Listings Requirements of the JSE and the Rabfam Sale is a
related party transaction. Accordingly, such related parties shall not
be entitled to vote the Shares held by them on any resolution in
connection with the Rabfam Sale at the general meeting to be convened to
consider the Rabfam Sale. The directors of the Company will obtain a
fair and reasonable opinion from independent advisors, the full details
of which will be included in a circular to be sent to shareholders in
due course.
6. DISTRIBUTION
6.1 The Company proposes making the Distribution of 34,27 cents per
Share, being an aggregate distribution of R10 847 866 based on 31 654
117 Shares in issue. The Distribution will be made as soon as is
reasonably possible after the Sale Closing Date.
6.2 Abbey and Rabfam warrant that the amount of the Distribution will
be 34,27 cents per Share and shall in the event of a shortfall, pay an
amount equal to such shortfall as an increase in the net amount payable
by Rabfam in terms of the Rabfam Sale. If the Company has any surplus
cash after making provision for the Distribution, then the Company shall
pay an amount equal to such excess to Rabfam as a reduction in the net
amount payable by Rabfam in terms of the Rabfam Sale.
7. SUSPENSIVE CONDITIONS
The implementation of the Disposals, the Distribution and the Sale
are subject to the fulfilment or waiver of, inter alia, the following
Suspensive Conditions:
7.1 Edge to Edge confirming in writing to Abbey that the Investment
Committee of BoE Corporate (a division of BoE Bank Limited) has passed a
resolution approving the purchase of the Sale Shares by Edge to Edge;
7.2 all regulatory and other approvals which may be required are
obtained, including, inter alia:
7.2.1 JSE and the Securities Regulation Panel ("SRP") approval; and
7.2.2 shareholder approvals of, inter alia, the Disposals and
Distribution.
8. UNAUDITED PRO FORMA FINANCIAL EFFECTS
The table below sets out the unaudited pro forma financial effects of
the Disposals and Distribution and the events after year end but before
the Disposals, as set out in the notes below, based on the published
audited consolidated financial statements of the Company for the
eighteen months ended 30 June 2002. The unaudited pro forma financial
effects are provided for illustrative purposes only and because of the
historical nature, may not give a fair reflection of the financial
position and results into the future.
Audited Pro % change
Before forma
30/06/02 After
Earnings/loss per Share (cents) 2.1 (5.5) -
Headline loss per Share (cents) (4.0) (2.4) -39.5
Net asset value per Share (cents) 43.2 5.5 -87.3
Net tangible asset value per Share 43.2 5.5 -87.3
(cents)
Cash distribution per Share (cents) - 34.3
Number of Shares in issue (`000) 31654 31654
Average weighted number of Shares 31654 31654
in issue (`000)
Notes:
Events after year end but before the Disposal
1. The guaranteed net proceeds of R3 784 866 from various disposals
already made by the Company since 30 June 2002 ("the Sale of Remainder
Assets"), have been taken into account in the same way as the Disposal
in calculating the unaudited pro forma net asset value per Share.
2. Mortgage bonds of R6 210 000 that were raised against the buildings
sold after 30 June 2002 but before the Disposals, were taken into
account in calculating the unaudited pro forma net asset value per
Share.
3. The redeeming of preference shares of R20 000 000 were taken into
consideration in calculating the unaudited pro forma net asset value per
Share.
Assumed timing of transactions
4. For purposes of calculating the unaudited pro forma earnings per
Share, it was assumed that the Sale of Remainder Assets and the
Disposals were effected on 1 January 2001.
5. For purposes of calculating the unaudited pro forma net asset value
per Share, it was assumed that the Sale of Remainder Assets, the
Disposals and Distribution were effected on 30 June 2002.
6. For purposes of calculating the unaudited pro forma earnings per
share it was assumed that the distribution of R10 847 866 was effected
on 1 January 2001 and thus no interest effect was taken into account.
General
7. The net loss of R766 000 on the Sale of Remainder assets and the
Disposal was based on the actual Disposal values and the book values as
at 30 June 2002 for purposes of calculating the unaudited pro forma
financial effects.
8. The net trading profits for the 18 months attributable to the
disposed subsidiaries, amounting to R1 294 000, were eliminated in
calculating the unaudited pro forma earnings per Share.
9. Estimated expenses of R344 000 relating to the Disposals were taken
into consideration in calculating the unaudited pro forma financial
effects.
9. CHANGE IN CONTROL AND OFFER
In terms of to the Agreement, the Sale Shares will be sold by Abbey to
Edge to Edge for a consideration of 10,125 cents per Share. Edge to
Edge has undertaken and is required in terms of the Code to, forthwith
after the Sale Closing Date, make the Offer to the Minority Shareholders
upon, inter alia, the following terms:
8.1 it shall comply with the Listings Requirements of the JSE and the
Code and the Rules of the SRP; and
the consideration will be the same as the consideration for each of the
Sale Shares, being 10,125 cents per Share.
10. GENERAL MEETING AND CIRCULAR TO SHAREHOLDERS
A general meeting of shareholders will be convened at which the
shareholders of the Company will consider, and if deemed fit, pass
resolutions to approve each of the Disposals and the Distribution and
any other resolutions (if any) required to give effect thereto. Full
details of the aforementioned transactions will be set out in a circular
to be posted to shareholders in due course.
11.. FURTHER CAUTIONARY ANNOUNCEMENT
Shareholders will be advised of the salient dates relating to the
transactions in a further announcement to be made in due course.
Shareholders should therefore continue to exercise caution when dealing
in their Shares until such further announcement is made.
CAPE TOWN
22 November 2002
Sponsor
Sasfin Bank Limited
(Registration No. 1951/002280/06)
Reporting Accountants
PricewaterhouseCoopers Inc
Chartered Accountants (SA)
Registered Accountants and Auditors
(Registration no 1998/012055/21)
Legal adviser
Sonnenberg Hoffmann Galombik
Date: 22/11/2002 02:17:57 PM Produced by the JSE SENS Department
