| Mon 5 May 2003, 8:19 | | ZARARA ENERGY LIMITED - PROPOSED CAPITAL REDUCTION |
|
ZARARA ENERGY LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1895/001078/06)
Share code: ZRR ISIN: ZAE000033080
("Zarara" or "the Company")
PROPOSED CAPITAL REDUCTION AND PAYMENT TO SHAREHOLDERS
1. Introduction
Shareholders are advised that the Zarara Board of Directors has resolved,
subject to the approval of shareholders at the forthcoming annual general
meeting of the necessary ordinary resolution, to reduce Zarara"s share premium
account in terms of section 90 of the Companies Act, 1973 (Act 61 of 1973), as
amended, and to make payment to shareholders of an amount of R57 236 248
(equivalent to 285 cents per share) ("the proposed distribution").
2. Rationale for the proposed distribution
Following the sale by Zarara of its shares in SA Bioproducts Holdings (Pty)
Ltd ("SA Bioproducts") and the withdrawal by New Republic Bank Limited of its
claim against Zarara, the proposed distribution is deemed by the directors to be
appropriate in view of the previously stated objectives to realise the Company"s
remaining assets to the best advantage of its shareholders. To this end, the
proposed distribution will take place subject to the passing, by shareholders at
the annual general meeting, of the required ordinary resolution.
3. Unaudited pro forma financial effects
As detailed in the circular to shareholders dated 17 January 2003 and in
Zarara"s 2002 Annual Report ("the Annual Report"), several transactions occurred
subsequent to the September 2002 financial year-end ("the transactions"). Set
out below are the unaudited pro forma financial effects of the transactions on
Zarara prior to the proposed distribution, based on the audited financial
results of Zarara for the year ended 30 September 2002.
Before the After the
transactions transactions Change
(cents)1 (cents) %
Loss per share (111,7) (182,1)2 (38,7)
Headline loss per share (90,3) (177,2)2 (49,1)
Net asset value per share 288,4 315,53 9,4
Notes:
1. Extracted from the audited financial results of Zarara for the year ended 30
September 2002.
2. Adjusted to reflect the earnings and headline earnings per share that the
Company would have earned had the transactions been effected by the Company with
effect from 1 October 2001 (from 1 January 2002 in respect of the sale of SA
Bioproducts, being the date on which Zarara originally acquired SA Bioproducts)
and the proceeds arising from the proposed sale had been invested to earn an
after tax interest income of 6,3% for the 12 months ended 30 September 2002 (for
nine months to 30 September 2002 for proceeds received in respect of the sale of
SA Bioproducts).
3. Adjusted to reflect the effect on the net asset value had the transactions
been effected by the Company with effect from 30 September 2002.
The table below sets out the unaudited pro forma financial effects of the
proposed distribution on Zarara after taking into account the unaudited pro
forma financial effects of the transactions as illustrated above.
Before the After the
proposed distribution proposed distribution Change
(cents)1 (cents) %
Loss per share (182,1) (182,1)2 0
Headline loss per share (177,2) (177,2)2 0
Net asset value per share 315,5 30,53 (90,3)
Notes:
1. Extracted from the unaudited pro forma financial effects of the transactions
calculated above.
2. Adjusted to reflect the earnings and headline earnings per share that the
Company would have earned had the proposed distribution been effected by the
Company with effect from 1 October 2001.
3. Adjusted to reflect the effect on the net asset value had the proposed
distribution been effected by the Company with effect from 30 September 2002.
4. Information pertinent to the proposed distribution and annual general
meeting
Full information regarding the proposed distribution as well as a notice
convening the annual general meeting of the Company is contained in the Annual
Report. The Annual Report will be posted to shareholders of Zarara on
Tuesday, 6 May 2003. Accordingly, the annotation "RE", as referred to in an
announcement dated 4 April 2003, will be lifted.
5. Change of sector
Following the completion of the transactions and the proposed distribution,
Zarara"s listing on the JSE Securities Exchange South Africa ("the JSE") lists
will be transferred to the "Financials - Specialty and Other Finance" sub sector
"Other Financial" from the "Resources - Oil and Gas" sub sector "Exploration and
Production" on Monday, 23 June 2003.
6. Salient dates relating to the proposed distribution
The salient dates and times of the proposed distribution are as follows:
2003
Last day to lodge form of proxy for the annual
general meeting by 11:00 on Monday, 26 May
Annual general meeting to be held at 11:00 on Wednesday, 28 May
Results announcement of annual general meeting
published on SENS on Wednesday, 28 May
Results announcement of annual general meeting
published in the press on Thursday, 29 May
If the resolution to effect the proposed distribution
is approved, it is anticipated that the following
timetable will be applicable for shareholders:
Last day to trade ("Cum") in order to receive
the proposed distribution payment on Friday, 6 June
Zarara shares to trade "Ex" the proposed
distribution payment on Monday, 9 June
Record date on which Zarara shareholders must
be recorded in the shareholders" register to be
entitled to the proposed distribution payment on Friday, 13 June
Proposed distribution payment made to shareholders on Tuesday, 17 June
Change of sector, which is likely to be effective on Monday, 23 June
Notes:
1. Any change to the above times and dates as approved by the JSE, as required,
will be advised by notification in the press and on SENS.
2. Share certificates may not be dematerialised or rematerialised between
Monday, 9 June 2003 and Friday, 13 June 2003, both days inclusive.
Johannesburg
5 May 2003
Corporate adviser and sponsor
PricewaterhouseCoopers
Corporate Finance (Pty) Ltd
(Registration number 1970/003711/07)
Reporting accountants
Deloitte & Touche Chartered Accountants (SA)
Registered accountants and auditors
