| Wed 23 Jul 2003, 17:27 | | Detailed Cautionary Announcement |
|
Wetherlys -
Wetherlys Investment Holdings Limited
(Incorporated in the Republic of South Africa)
(Registered number 1996/016455/06)
Share code: WET ISIN: ZAE000013827
("Wetherlys" or "the company")
DETAILED CAUTIONARY ANNOUNCEMENT
1. Introduction
Further to the cautionary announcement dated 3 July 2003, the board of directors
of Wetherlys ("the board") has been formally advised by Ellerine Holdings
Limited ("Ellerines") that, subject to a due diligence review and funding
confirmation, Ellerines intends to make an offer to shareholders of Wetherlys to
acquire the entire issued share capital of Wetherlys ("the transaction"). The
transaction is subject to the fulfilment of the conditions as set out in
paragraph 4 below.
2. Terms of the transaction
It is proposed that the transaction will be implemented by way of a scheme of
arrangement ("the scheme") in terms of section 311 of the Companies Act (No. 61
of 1973), as amended, ("the Act") to be proposed by Ellerines between Wetherlys
and all of its shareholders ("the scheme members").
The implementation of the transaction will result in Wetherlys" shareholders
receiving 390 cents in cash for each ordinary share in the share capital of
Wetherlys, which amounts to a total consideration of approximately R507 million.
Upon the implementation of the scheme, Wetherlys will become a wholly-owned
subsidiary of Ellerines and the JSE Securities Exchange South Africa ("JSE")
will, upon application, terminate the listing of Wetherlys. Wetherlys will,
however, operate independently of the other retailers in the Ellerines" group
and in so doing will retain its identity and branding.
3. Opinions
Wetherlys" management has met with Ellerines and is, subject to a positive
recommendation by the board, supportive of the transaction. The board is
undertaking the necessary steps to enable it to make a decision on recommending
such an offer to the shareholders of Wetherlys, in the manner contemplated in
the Code of the Securities Regulation Panel ("SRP"). In this regard, the board
has appointed:
- Standard Corporate and Merchant Bank as an independent financial adviser to
advise the board on whether the terms and conditions of the transaction are fair
and reasonable to Wetherlys" shareholders; and
- a sub-committee of independent directors to consider the transaction.
4. The conditions precedent
The implementation of the transaction is conditional upon the fulfilment of the
following conditions precedent:
- the satisfactory completion of a due diligence review of Wetherlys by
Ellerines by no later than Tuesday, 5 August 2003;
- the entering into by no later than Tuesday, 5 August 2003 of service
agreements between Ellerines and certain key members of management of Wetherlys,
which agreements will be subject to the successful implementation of the
transaction;
- the board, subject to the receipt of a fair and reasonable opinion,
recommending the transaction to the shareholders of Wetherlys;
Ellerines procuring confirmation, in a format acceptable to the SRP, that it has
- the funding in place to meet its obligations under the transaction, by no
later than Wednesday, 6 August 2003;
- to the extent necessary, the approval of the transaction by the shareholders
of Ellerines in general meeting;
- the obtaining of the approvals of all regulatory authorities if and to the
extent necessary, including those of the South African Reserve Bank, the SRP,
the JSE and the competition authorities;
- the sanctioning of the scheme by a majority representing not less than 75% of
the votes exercisable by scheme members present and voting either in person or
by proxy at a meeting of scheme members;
- the High Court of South Africa sanctioning the scheme in terms of the Act; and
- a certified copy of the Order of Court sanctioning the scheme being registered
by the Registrar of Companies in terms of the Act.
5. Cautionary announcement
Shareholders of Wetherlys are advised to continue to exercise caution when
dealing in the company"s securities until a further announcement is made on or
about Wednesday, 6 August 2003.
Johannesburg
23 July 2003
Merchant bank and independent financial Sponsor
adviser
Standard Corporate and Merchant Bank Nedbank Corporate
(A division of The Standard Bank of (A division of Nedbank Limited)
South Africa Limited)
Joint legal advisers
Moss Morris Derek H Rabin and Associates
Moss Morris Attorneys (Pty) Ltd
Date: 23/07/2003 05:09:16 PM Supplied by www.sharenet.co.za
Produced by the JSE SENS Department
