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AST Group Limited - Detailed Terms Of The Rights Offer And Consolidation
AST Group Limited
(Incorporated in the Republic of South Africa)
(Registration number 1998/021790/06)
Share code: AAA
ISIN: ZAE000027397
("AST" or "the Company")
DETAILED TERMS OF THE RIGHTS OFFER AND CONSOLIDATION
1. Introduction
Further to the announcements dated 14 May, 25 June and 5 August 2003, the
board of directors of AST ("the board") is pleased to announce the terms of
the rights offer and the consolidation of AST shares of 0.01 cents per share
("AST shares") on a one for ten basis.
2. The rights offer
2.1 Terms of the rights offer
The board has resolved to proceed with a fully underwritten rights offer on
the following terms:
Number of shares offered in terms of the rights
offer ("rights shares") 986 111 111
Ratio of entitlement 142.85549 rights shares
for every 100 AST shares held
Price per rights share 9 cents
Total amount to be raised (before expenses) R88 750 000
Total number of AST shares in issue before the rights offer 690 285 744
Total number of AST shares in issue after the rights offer 1 676 396 855
2.2 Reason for the rights offer
The purpose of the rights offer is to raise R88.75 million (before expenses)
which will be utilised to reduce the Company"s debt.
2.3 Underwriting
Kumba Resources Limited, the Iscor Pension Fund, The Standard Bank of South
Africa Limited and Cadtech (Proprietary) Limited (collectively, "the
underwriters") have agreed to underwrite the rights offer to a maximum of
R88.75 million. An aggregate underwriting fee of R1.775 million (excluding
VAT), calculated at 2% of each underwriter"s underwriting commitment, is payable
by the Company to the underwriters. The underwriting agreement between the
Company and the underwriters is subject to certain conditions precedent as set
out in paragraph 2.8 below.
2.4 Waiver of potential mandatory offer
The underwriting of the rights offer may, should existing AST shareholders
not follow their rights, result in the underwriters collectively owning more
than 35% of the share capital of the Company. In this event, and given the
current financial position of the Company, the Securities Regulation Panel
has ruled in terms of Rule 34 of the Securities Regulation Code
on Take-overs and Mergers ("the Code") that the underwriters shall not,
collectively or individually, be obliged to make a mandatory offer to AST
shareholders as required in terms of Rule 8.1 of the Code, consequent to any
acquisition of AST shares as a result of the underwriters fulfilling their
underwriting obligations.
2.5 Listing on the JSE Securities Exchange South Africa ("the JSE")
An application has been made to the JSE for a listing of the renounceable
(nil paid) letters of allocation (under the share code AAAN) and the rights
shares.
2.6 Unaudited pro forma financial effects of the rights offer
The unaudited pro forma financial effects set out below are provided for
illustrative purposes only, to show the effect of the fully underwritten
rights offer on headline earnings per share ("HEPS"), diluted HEPS, earnings
per share ("EPS") and diluted EPS as if the rights offer proceeds had been
received on 1 July 2002 and net asset value ("NAV") and net tangible asset
value ("NTAV") per share as if the rights offer proceeds had been received
on 30 June 2003 and, because of their nature, may not give a fair reflection
of AST"s financial position and performance. The unaudited pro forma
financial effects have been compiled from the Company"s audited annual
financial statements for the year ended 30 June 2003, adjusted as described
below.
Before the After the Percentage
rights offer rights offer change (%)
HEPS (cents) (10.15)(1) (3.37)(3) 66.80
Diluted HEPS (cents)* (10.15)(1) (3.37)(3) 66.80
EPS (cents) (37.10)(1) (13.70)(3) 63.07
Diluted EPS (cents)* (37.10)(1) (13.70)(3) 63.07
NAV per share (cents) 18.46 (2) 12.45 (4) (32.56)
NTAV per share (cents) (3.50)(2) 3.54 (4) 201.14
* Due to the anti-dilutive effect of the rights offer, the new shares are,
under the provisions of AC 104, not taken into account when calculating the
diluted HEPS and EPS.
Notes:
1. The HEPS and EPS before the rights offer have been extracted from the
Company"s audited financial statements for the year ended 30 June 2003 and
have been calculated based on a weighted average number of 613 232 465 AST
shares. The diluted HEPS and EPS before the rights offer has been extracted
from the Company"s audited financial statements for the year ended
30 June 2003 and has been calculated based on a weighted average number of
940 462 041 AST shares.
2. The NAV and NTAV per share before the rights offer has been extracted
from the audited balance sheet of AST at 30 June 2003 and is based on
673 104 639 ordinary shares in issue at that date.
3. It has been assumed that the rights offer of 986 111 111 rights shares
was fully taken up by the AST shareholders for a total amount of
R88.75 million and that the proceeds (net of costs relating to the rights
offer) therefrom were received on 1 July 2002 and were immediately used to
settle a portion of the Company"s liabilities bearing interest at the
current prime rate of 14.5% over the year. The pro forma HEPS and EPS after
the rights offer has been based on a weighted average number of shares in issue
of 1 599 343 576 and a diluted weighted average number of shares in issue of
1 926 573 152, adjusted as if the full rights offer was taken up at
1 July 2002.
4. The pro forma NAV and NTAV per share after the rights offer has been
calculated based on 1 659 215 750 shares in issue adjusted as if the full
rights offer of R88.75 million (net of costs relating to the rights offer)
had been taken up at 30 June 2003.
2.7 Issue of letters of allocation in dematerialised form
AST will issue letters of allocation in dematerialised form and the
electronic record in respect of holders of certificated AST shares will be
maintained by Ultra Registrars (Proprietary) Limited, the transfer office of
AST. This will make it possible for holders of certificated AST shares to
enjoy the same rights and opportunities as those shareholders who have
already dematerialised their AST shares. AST will issue each holder of
certificated AST shares with a form of instruction in respect of a letter of
allocation reflecting the number of rights shares allocated to them. By
completing the relevant form of instruction, holders of certificated AST
shares will be able to indicate whether or not all or part of the rights to
the rights shares should be sold, renounced or taken up and whether or not
such holders of certificated AST shares wish to apply for additional rights
shares. The form of instruction will be sent to holders of certificated AST
shares together with the circular relating to the rights offer as referred to in
paragraph 4 below.
Holders of dematerialised AST shares will have the number of rights
shares allocated to them automatically credited to their custody account by
their appointed Central Securities Depository Participant ("CSDP") or broker
in electronic form. The CSDP or broker will advise such shareholders of the
procedure that they need to follow for the sale, renunciation or taking-up
of their rights shares and for the application for additional rights shares.
2.8 Conditions precedent to the rights offer
The implementation of the rights offer is subject to the fulfilment of the
following conditions precedent:
* the approval of the JSE and the granting of a listing for the 986 111 111
renounceable (nil paid) letters of allocation and the 986 111 111 rights shares
to be issued pursuant to the rights offer; and
* the registration of the rights offer and related documents by the Registrar of
Companies.
2.9 Important dates and times for the rights offer
The important dates and times pertaining to the rights offer have been set out
in the table below.
2003
Last day to trade in AST shares in order to
qualify to participate in the rights offer
(cum entitlement) on Friday, 5 September
Listing of letters of allocation on the JSE
commences at 09:00 on Monday, 8 September
Letters of allocation commence trading on the
JSE at 09:00 on Monday, 8 September
AST shares commence trading ex rights on the
JSE at 09:00 on Monday, 8 September
Record date for the rights offer at the close
of trade on Friday, 12 September
Rights offer opens at 09:00 on Monday, 15 September
Last day for trading in letters of allocation on
the JSE Friday, 26 September
Listing of rights shares on the JSE commences at
09:00 on Monday, 29 September
Rights offer closes at 14:30 on Friday, 3 October
Record date for letters of allocation Friday, 3 October
Refund cheques to holders of certificated AST shares,
if applicable, in respect of unsuccessful excess
applications, posted on or about Monday, 6 October
Entitlements in terms of the rights offer available on Monday, 6 October
Rights shares issued and posted to holders of
certificated AST shares on or about Monday, 6 October
CSDP or broker accounts in respect of holders of
dematerialised AST shares debited and updated on Monday, 6 October
Results of rights offer announced on SENS on or about Monday, 6 October
Results of rights offer announced in the press on Tuesday, 7 October
Notes:
1. These dates and times are subject to amendment. Any such amendment will
be published on SENS and in the press.
2. In respect of AST shares, share certificates may not be dematerialised or
rematerialised between Monday, 8 September 2003 and Friday,
12 September 2003, both days inclusive.
3. CSDPs effect payment on a delivery versus payment method in respect of
holders of dematerialised AST shares.
4. If you are a holder of dematerialised AST shares you are required to notify
your duly appointed CSDP or broker of your acceptance of the rights offer in
the manner and time stipulated in the agreement governing the relationship
between yourself and your CSDP or broker.
AST does not take responsibility and will not be held liable for any
failure on the part of any CSDP or broker to notify you of the rights offer
and/or to obtain instructions from you to subscribe for the rights shares
and/or to sell the rights allocated.
3. The consolidation
3.1 Terms of the consolidation
In order to provide the Company with a more meaningful share price, the
board proposed, and AST shareholders have in general meeting approved the
necessary resolutions to authorise, the consolidation of the share capital
of the Company on a one for ten basis. Thus a shareholder that holds ten
AST shares with a par value of 0.01 cent each prior to the consolidation
will hold one new AST share with a par value of 0.1 cent each ("new AST shares")
once the consolidation has been implemented.
At low share prices, such as have recently been experienced by AST, small
movements in the share price, which are limited by the JSE to whole cents,
constitute relatively significant percentage changes in value. The
consolidation will allow for more flexible and accurate pricing of the AST
share in the future.
3.2 Conditions precedent to the consolidation
The consolidation is subject to the following conditions precedent:
* the approval of the JSE; and
* the registration of the necessary special resolutions by the Registrar of
Companies.
3.3 Listing on the JSE
An application has been made to the JSE to amend the listing of AST shares
to take account of the consolidation.
3.4 Important dates and times for the consolidation
The consolidation will be implemented following the completion of the rights
offer. The important dates and times pertaining to the consolidation have
been set out in the table below.
2003
Last day to trade in AST shares prior to the
consolidation on Friday, 24 October
New capital structure of AST listed on the JSE at
09:00 on Monday, 27 October
Trading in new AST shares on the JSE commences at
09:00 on Monday, 27 October
Record date for the consolidation after the close of
trade on Friday, 31 October
In respect of holders of certificated AST shares,
if AST ordinary share certificates are surrendered
together with the surrender forms on or before the
close of trade on Friday, 31 October 2003, new AST
ordinary share certificates will be posted, at the
risk of AST shareholders, on Monday, 3 November
Holders of dematerialised AST shares will have their
safe custody accounts that they hold with their CSDP
or broker updated with the new AST shares on Monday, 3 November
Notes:
1. These dates and times are subject to amendment. Any such amendment will
be published on SENS and in the press.
2. Share certificates in preconsolidated form may not be dematerialised or
rematerialised after Friday, 24 October 2003.
4. Circular
A circular providing further details relating to the rights offer and
consolidation and incorporating revised listing particulars, a renounceable
(nil paid) letter of allocation and a form of surrender will, subject to the
approval of the JSE, be posted to AST shareholders on 15 September 2003.
Centurion
22 August 2003
Merchant bank and advisor
Standard Corporate and Merchant Bank
(A division of The Standard Bank of South Africa Limited)
(Registration number 1962/000738/06)
Attorneys to AST
Moss Morris Attorneys
Sponsor to AST
Cazenove South Africa (Proprietary) Limited
(Registration number 1998/011736/07)
Member of the JSE Securities Exchange South Africa
Attorneys to the Iscor Pension Fund
Routledge-Modise
(Registration number 1992/006150/21)
Reporting accountant
PricewaterhouseCoopers Inc.
Chartered Accountants (SA)
Registered Accountants & Auditors
(Registration no. 1998/012055/21)
Date: 22/08/2003 05:12:31 PM Produced by the JSE SENS Department
