| Wed 15 Oct 2003, 16:31 | | Mandatory offer to Alacrity shareholders and furth |
|
Alacrity/Pamodzi -
ALACRITY FINANCIAL SERVICES LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1994/000078/06)
Share code: ALY
ISIN code: ZAE000023966
("Alacrity")
PAMODZI UKUVIKELA INVESTMENTS (PROPRIETARY) LIMITED
(Incorporated in the Republic of South Africa)
(Registration number: 2000/016300/07)
("Pamodzi")
Announcement regarding a mandatory offer to Alacrity shareholders and further
cautionary announcement
1. Introduction
Alacrity shareholders are referred to the further cautionary announcement
published on the Securities Exchange News Service ("SENS") of the JSE Securities
Exchange South Africa ("JSE") on 29 August 2003. In terms of the aforementioned
announcement Alacrity was advised that Pamodzi had entered into an agreement in
terms of which it would, subject to the fulfillment of certain suspensive
conditions, acquire additional shares in Alacrity ("the Pamodzi Transaction"),
and that should the Pamodzi Transaction become unconditional, Pamodzi would be
required to extend an offer to Alacrity shareholders other than Pamodzi and the
holder of any Alacrity shares held as treasury shares ("Alacrity minority
shareholders") in accordance with the provisions of the Securities Regulation
Code on Take-Overs and Mergers ("the Code") administered by the Securities
Regulation Panel ("the SRP").
Alacrity was advised on 14 October 2003 that the suspensive conditions relating
to the Pamodzi Transaction, which suspensive conditions included the
unconditional approval of the Competition Authorities, have been fulfilled and,
accordingly, Pamodzi has acquired an additional 17 172 800 Alacrity shares
(representing 13.2% of the issued share capital of Alacrity) at 20 cents per
share, net of costs, from Swanvest 120 (Proprietary) Limited ("Swanvest"), a
wholly owned subsidiary of Santam Limited. Pamodzi now holds 50.1% of the issued
share capital of Alacrity.
In terms of the Code, Pamodzi is obliged to extend a mandatory offer to all
Alacrity minority shareholders to acquire all or any of their Alacrity shares
("the offer") at an offer price of 20 cents per Alacrity share. Pamodzi has
however increased the aforementioned mandatory offer price to 41 cents per
Alacrity share payable in cash ("the offer consideration").
2. The offer
2.1 Terms of the offer
In terms of the offer, Pamodzi will irrevocably and unconditionally offer to
acquire any or all of the Alacrity shares from each Alacrity minority
shareholder for the offer consideration.
2.2 Offer consideration
Each Alacrity minority shareholder who accepts the offer will receive a
consideration of 41 cents in cash per Alacrity share.
2.3 Intention to invoke the provisions of section 440K of the Companies Act,
1973 (Act 61 of 1973), as amended ("the Companies Act")
Should acceptances of the offer by Alacrity minority shareholders representing
not less than nine-tenths of the Alacrity shares held by Alacrity minority
shareholders be obtained, Pamodzi may, at its election, invoke the provisions of
section 440K of the Companies Act and compulsorily acquire the Alacrity shares
held by the Alacrity minority shareholders who had not previously accepted the
offer.
2.4 Cash confirmation
The SRP has been furnished with written confirmation that Pamodzi has sufficient
cash resources and/or facilities with which to meet its obligations in terms of
the offer.
2.5 Special arrangements
Subject to obtaining the necessary regulatory approvals, Swanvest has undertaken
to Pamodzi to acquire any Alacrity shares in respect of which acceptances have
been received and which would result in Pamodzi holding more than 50.1% of the
Alacrity shares in issue, and Pamodzi will procure that where possible such
Alacrity shares will be transferred directly to Swanvest.
3. Proposed delisting of Alacrity
Taking into account the limited public spread of Alacrity shareholders that may
exist subsequent to the implementation of the offer and the costs involved in
maintaining Alacrity"s listing, the board of directors of Alacrity ("the
Alacrity board") will propose that, subject to the approval of Alacrity
shareholders being obtained in general meeting in terms of paragraph 1.15 of the
Listings Requirements of the JSE, the ordinary shares of Alacrity be delisted
from the JSE ("the proposed Alacrity delisting").
4. Pro forma financial effects of the offer
The table below sets out the pro forma financial effects of the offer on an
Alacrity minority shareholder who accepts the offer:
Note Before After the
Per Alacrity share the offer offer % change
(cents) (cents)
Market value - 14 October 1 30.00 41.00 36.67
2003
Market value - 28 August 2 25.00 41.00 64.00
2003
Market value - 10 July 2003 3 21.00 41.00 95.24
Earnings and headline
earnings 4 1.68 1.72 2.38
Net asset value 5 2.93 41.00 1 299.32
Net tangible 5 (8.20) 41.00 NA
asset/(liability) value
The pro forma financial effects have been prepared for illustrative purposes
only, to provide information on how the offer might have affected the financial
position of Alacrity minority shareholders and, because of its nature, may not
give a true reflection of the financial effects of the offer. The pro forma
financial effects have been calculated on the basis set out below.
Notes:
1. The "Before" column reflects the closing market price of an Alacrity share
on 14 October 2003, being the trading day immediately preceding the date of this
announcement. The "After" column reflects the offer consideration.
2. The "Before" column reflects the closing market price of an Alacrity share
on 28 August 2003, being the trading day immediately preceding the publication
of the further cautionary announcement on 29 August 2003 referred to in
paragraph 1 above. The "After" column reflects the offer consideration.
3. The "Before" column reflects the closing market price of an Alacrity share
on 10 July 2003, being the trading day immediately preceding the publication of
the cautionary announcement on 11 July 2003. The "After" column reflects the
offer consideration.
4. The "Before" column reflects the earnings and headline earnings per Alacrity
share for the 6 months ended 30 June 2003, calculated on the basis of the
weighted average number of 117.351 million Alacrity shares in issue (excluding
any Alacrity treasury shares) throughout the period. The "After" column reflects
the after tax interest which an Alacrity minority shareholder would have earned
had an amount equivalent to the offer consideration been invested at an after
tax interest rate of 8.4% per annum for the 6 months ended 30 June 2003.
5. The "Before" column reflects the net asset value and net tangible liability
value per Alacrity share as at 30 June 2003, and is based on 117.351 million
shares in issue (excluding any Alacrity treasury shares) at 30 June 2003. The
"After" column reflects the offer consideration.
No account has been taken of any personal taxes, save as set out in note 0, that
might be applicable to Alacrity minority shareholders in the calculation of the
above pro forma financial effects.
5. Opinions and recommendations
The Alacrity board has appointed an independent adviser to provide an
independent opinion on whether the terms of the offer are fair and reasonable to
Alacrity minority shareholders. The Alacrity board will review the terms of the
offer and consider the opinion of the independent adviser and will, in turn,
make a recommendation to Alacrity minority shareholders.
6. Documentation and further announcement
A circular giving details of the offer and the proposed Alacrity delisting
is in the course of preparation and will, subject to the approval of the JSE,
the SRP and the South African Reserve Bank, be posted to Alacrity shareholders
in due course.
An announcement giving the salient dates of the offer will be made on or about
the date on which the abovementioned circular is posted.
7. Further cautionary announcement
Alacrity shareholders are referred to the further cautionary announcement
published on SENS on 29 August 2003 and are advised that negotiations, which are
unrelated to the offer, are still in progress which, if successfully concluded,
may have a material effect on the price at which the Alacrity shares trade on
the JSE. Alacrity shareholders are therefore advised to continue to exercise
caution when dealing in their Alacrity shares until a further announcement
regarding the aforementioned negotiations is made.
Johannesburg
15 October 2003
Corporate adviser and Sponsor to Alacrity:
Quaestor Capital (Proprietary) Limited
Corporate adviser to Pamodzi:
Investec Corporate Finance
Legal adviser to Pamodzi:
Cliffe Dekker Inc.
Date: 15/10/2003 04:01:22 PM Supplied by www.sharenet.co.za
Produced by the JSE SENS Department
