| Mon 10 Mar 2003, 14:15 | | Mettle - Announcement to the shareholders of iPROP |
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Mettle Limited
Incorporated in the Republic of South Africa)
(Registration number 1996/010795/06)
(Formerly Greenwich Group Limited)
JSE Share code: MEL ISIN: ZAE000028569
("Mettle" or "the company")
Announcement to the shareholders of iPROP HOLDINGS LIMITED
("Iprop HOLDINGS") OF AN OFFER TO ACQUIRE THE BUSINESSES OF IPROP HOLDINGS,
IPROP LIMITED AND LERIX INVESTMENTS (PTY) LIMITED
1.INTRODUCTION
1.1 Mettle Limited ("Mettle") is authorised to announce that Rowan Tree 4 (Pty)
Limited ("Rowan Tree"), a wholly-owned subsidiary of Mettle, has delivered an
offer ("the Rowan Tree Offer") to a representative of the board of directors of
iProp Holdings to acquire the businesses of iProp Holdings, iProp Limited
("iProp") and Lerix Investments (Pty) Limited ("Lerix") (collectively referred
to as "the Sellers").
1.2 Such businesses comprise the assets and liabilities of the Sellers ("the
Businesses"), save for a loan indebtedness which iProp has to iProp Holdings and
a loan indebtedness which Lerix has to Nedbank Ltd, it being contemplated that
part of the cash proceeds payable by Rowan Tree, in the event that the Rowan
Tree Offer is accepted and becomes unconditional according to its terms, will be
utilised to discharge such liabilities to iProp Holdings and to Nedbank Ltd.
1.3 Such offer when compared with the Clidet Transaction (as referred to and as
more fully described below) will result in an additional R9.9 million of
distributable proceeds available to the shareholders of iProp Holdings. On a
fully diluted basis this amounts to a premium of 60 cents per share.
2. THE CLIDET TRANSACTION GENERALLY
2.1 The Sellers have concluded a similar transaction with Clidet No 433 (Pty)
Limited ("Clidet") on the basis that such transaction ("the Clidet Transaction")
is subject to the fulfilment of various conditions precedent ("the Clidet
Conditions Precedent").
2.2 Details of the Clidet Transaction are the subject matter of an announcement
made by the board of directors of iProp Holdings on 21 January 2003, and of a
Circular to Shareholders of iProp Holdings, issued on 14 February 2003 ("the
Clidet Circular").
3. IMPROVED OFFER
3.1 Following a review by Rowan Tree and its advisers of the Clidet Circular and
the audited financial statements of iProp Holdings for the year ended 30
September 2002 ("the Effective Date Financial Statements"), Rowan Tree has
committed itself to the Rowan Tree Offer in the belief that it is a considerably
better offer than the Clidet Transaction.
3.2 In stating the financial effects of the Rowan Tree Offer and in making
comparisons between the terms and conditions of the Rowan Tree Offer and the
terms and conditions of the Clidet Transaction, it is being assumed -
3.2.1 that the contents of the Effective Date Financial Statements and of the
Clidet Circular are correct; and
3.2.2 that there has been no adverse change in the net asset value of iProp
Holdings since 1 October 2002; and
3.2.3 that the "Transaction Liabilities", which are assumed by Clidet in terms
of the Clidet Transaction, will not exceed R4.4 million.
3.3 The terms and conditions of the Rowan Tree Offer are substantially the same
as the terms and conditions of the Clidet Transaction except that -
3.3.1 if the Rowan Tree Offer is accepted and becomes unconditional according to
its terms, the net cash proceeds available to iProp Holdings for distribution to
the shareholders of iProp Holdings will be R92.6 million, which equates to
560 cents per iProp Holdings share on a fully diluted basis and which amounts to
a premium of 60 cents per iProp Holdings share when compared to the price
payable in terms of the Clidet Transaction;
3.3.2 the Rowan Tree Offer is not subject to Rowan Tree having to secure
funding, Rowan Tree having already done so and having furnished the board of
directors of iProp Holdings with a payment guarantee from Nedbank Ltd for the
full amount of the cash component of the purchase price. For the sake of clarity
it is pointed out that, as is the case in terms of the Clidet Transaction, a
portion of the purchase price is to be discharged Rowan Tree assuming certain
liabilities;
3.3.3 the Rowan Tree Offer is subject to certain additional conditions
precedent, as more fully set out in paragraph 5 hereof;
3.3.4 closing under the Rowan Tree Offer, in the event that it is accepted and
becomes unconditional according to its terms, will happen on one day, and
against delivery to Rowan Tree of the Businesses as contemplated in the Rowan
Tree Offer, the full purchase price will be paid. Such payment will be effected
by an assumption of the liabilities which are to be assumed in terms of the
Rowan Tree Offer and by way of a cash payment pursuant to the Nedbank payment
guarantee;
3.3.5 the Sellers warrant to Rowan Tree that they will be able to give good
title of the Businesses to Rowan Tree on transfer. No other warranties are
required from the Sellers.
4. STRUCTURE OF THE ROWAN TREE OFFER
In the event that the Rowan Tree Offer is accepted, the implementation of the
acquisition of the Businesses will be effected as follows -
4.1 by Rowan Tree directly acquiring the Sellers" assets (excluding any Mining
Rights held by them and cash up to R37 million) and the Sellers" liabilities
(excluding the claim of iProp Holdings for R28.433 million owing to it by iProp,
the loan indebtedness of Lerix to Nedbank Ltd, rehabilitation liabilities and
liabilities associated with the litigation referred to in paragraph 20 of the
Clidet Circular);
4.2 by Rowan Tree indirectly acquiring any Mining Rights held by iProp or any
subsidiaries of the Sellers, and any rehabilitation liabilities of iProp and of
any subsidiaries of the Sellers, as well as any liabilities of iProp associated
with the abovementioned litigation,in consequence of it acquiring the issued
shares in iProp and such subsidiaries;
4.3 the R37 million cash referred to will not be acquired directly or indirectly
by Rowan Tree and such cash will be available as part of the proceeds for
ultimate distribution to the shareholders of iProp Holdings;
4.4 delivery and payment will take place, after the fulfilment of all conditions
precedent, as soon as the Sellers are able to register transfer of the immovable
properties (which constitute part of the direct sale to Rowan Tree) in the name
of Rowan Tree.
5. THE ADDITIONAL ROWAN TREE CONDITIONS PRECEDENT
5.1 In addition to the Clidet Conditions Precedent (but excluding those referred
to in paragraph 5.3) the Rowan Tree Offer is subject to the following conditions
precedent -
5.1.1 that the disposal of the Businesses to Rowan Tree is advertised in
accordance with the provisions of Section 34 of the Insolvency Act No 24 of 1936
and that no demand as contemplated in Section 34(2) thereof is made after such
publication but prior to closing and that no proceedings as contemplated in
Section 34(3)(b) thereof are instituted prior to closing;
5.1.2 that Rowan Tree obtains written confirmation in respect of the endowment
policies, reflected in the Effective Date Financial Statements at a value of R13
million, from the issuers of such policies that they will be capable of being
surrendered for a net amount of at least R13 million within 30 days of the date
on which the Rowan Tree Offer becomes unconditional;
5.1.3 to the extent necessary, that Mettle, obtains the approval of the JSE
Securities Exchange South Africa and of the Securities Regulation Panel and of
its shareholders. At the date of this announcement, Mettle shareholders
representing in excess of 50% of the ordinary shares of Mettle have provided
irrevocable undertakings to vote in favour of the transactions contemplated in
the Rowan Tree Offer.
5.2 The conditions referred to paragraphs 5.1.1 and 5.1.2 above are entirely for
the benefit of Rowan Tree who may waive either or both such conditions.
5.3 The Rowan Tree Offer is not subject to certain of the Clidet Conditions
Precedent, namely -
5.3.1 that all agreements for the funding of Clidet, in connection with the
Clidet Transaction, are entered into and become unconditional in accordance with
their terms;
5.3.2 that Lerix registers transfer of its immovable property in the name of
Clidet and that a mortgage bond of R50 million in favour of Absa Bank Ltd be
registered over such property.
6 SHARES HELD IN IPROP HOLDINGS
6.1 Metway 19 (Pty) Limited, a wholly owned subsidiary of Mettle, holds 190 000
shares in iProp Holdings.
7. DOCUMENTATION AVAILABLE FOR INSPECTION
7.1 A copy of the Rowan Tree Offer, as well as a copy of the Nedbank payment
guarantee, is open for inspection by shareholders of iProp Holdings and their
respective advisers, at the offices of Mettle, 33 Fricker Road, Illovo
Boulevard, Sandton.
7.2 Should any iProp Holdings shareholder wish to make such inspection, this can
be arranged by contacting any of the following employees of Mettle: Reinette
Fleischmann - (011) 446 9200 or Anisabel van Zyl (021) 915 3300.
7.3 If an iProp shareholder or its adviser wishes to discuss any aspects of the
Rowan Tree Offer, this can be arranged through contacting any one of the
individuals referred to in paragraph 0 hereof.
8. ACTIONS TO BE TAKEN BY IPROP HOLDINGS SHAREHOLDERS
8.1 A general meeting ("the Meeting") of iProp Holdings shareholders is to be
held at 09h30 on Wednesday, 12 March 2003, at the address indicated in the
notice given to iProp Holdings shareholders of the Meeting. The purpose of the
Meeting is to consider and vote on the Clidet Transaction.
8.2 iProp Holdings shareholders have been requested, in terms of the Clidet
Circular, to lodge their proxy forms for the Meeting by 09h30 on Monday,
10 March 2003.
8.3 In light of the Rowan Tree Offer, it is the hope of Rowan Tree that the
shareholders of iProp Holdings will, if necessary, revoke their proxy forms and
thereafter attend the meeting for the purpose of voting against the Clidet
Transaction.
8.4 It is the expectation of Rowan Tree that the board of directors of iProp
Holdings will make an announcement to the shareholders of iProp Holdings in due
course, detailing the response of the board, to the Rowan Tree Offer, as well as
the further actions required by the shareholders of iProp Holdings.
Johannesburg
10 March 2003
Corporate Advisor Transactional Sponsor
-Mettle Limited -Exchange Sponsors-
Attorneys
-Prinsloo, Tindle & Andropoulos Inc-
