| Tue 25 Nov 2003, 16:03 | | Salient Dates And Times And Supplementary Informa |
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Pepkor Limited - Salient Dates And Times And Supplementary Information
Pepkor Limited
(Incorporated in the Republic of South Africa)
(Registration number 1965/007765/06)
Ordinary share code: PEP ISIN: ZAE000005344
("Pepkor" or "the Company")
SALIENT DATES AND TIMES AND SUPPLEMENTARY INFORMATION
1. INTRODUCTION
1.1 Shareholders are referred to the Pepkor announcement of 23 October 2003
("the Terms Announcement"), which contained details of the firm intention
of Castellina Investments (Proprietary) Limited ("Castellina") to make an
offer to acquire the entire ordinary issued share capital of Pepkor (save
for those ordinary shares held by Pepkor subsidiaries as treasury shares),
and to procure the redemption of all the preference shares of Pepkor ("the
Offer"), by way of a scheme of arrangement in terms of Section 311 of the
Companies Act (Act 61 of 1973) as amended ("the Scheme").
1.2 As advised in the Terms Announcement, the Offer will be R10 for each
Pepkor ordinary share. In terms of the Offer, the Pepkor ordinary
shareholders will be entitled:
1.2.1 to receive R10 per share for each Pepkor ordinary share ("the
Cash Consideration"); or
1.2.2 for every 100 Pepkor ordinary shares to receive:
(a) 60.885 ordinary shares in the issued share capital of Castellina,
issued at R1 per share; plus
(b) class "A" loan claims of R711.894 against Castellina; plus
(c) bridging loan claims of R227.221 against Castellina,
which will be equivalent to R1 000 for every 100 Pepkor ordinary
shares held (collectively the "Reinvestment Alternative").
Furthermore the preference shareholder will receive R33,3 million for
the loss of all rights attaching to the Pepkor preference shares as a
result of their redemption by Pepkor on the implementation of the
Scheme as set out in 4.1 below.
2. CONVENING OF THE SCHEME MEETING
On Monday, 24 November 2003, the High Court of South Africa (Cape Provincial
Division) ("the Court") granted Pepkor leave to convene the scheme meeting, at
which Pepkor ordinary shareholders ("Shareholders") will be requested to vote on
the Scheme.
3. IMPORTANT DATES AND TIMES
The important dates and times are set out below:
2003
Last day for Shareholders to trade their Pepkor
ordinary shares to be recorded in the register
of Shareholders or in the sub-registers of Pepkor
administered by Central Securities Depository
Participants ("CSDP"), on the voting record date Monday, 1 December
Voting record date - the date on which Shareholders
must be recorded in the register of Shareholders or
in the relevant sub-registers of the CSDPs
administering the sub-registers of Pepkor, in order
to be able to vote at the scheme meeting by 17:00 on Monday, 8 December
Last day to lodge forms of proxy for the scheme
meeting by 10:00 on Tuesday, 9 December
Scheme meeting to be held at 10:00 on Thursday, 11 December
Result of scheme meeting announced on the
Securities Exchange News Service ("SENS") Thursday, 11 December
Result of the scheme meeting announced in the
press on Friday, 12 December
2004
Court hearing, at 10:00 or as soon thereafter
as Counsel may be heard, to sanction the Scheme on Tuesday, 13 January
If the Scheme is sanctioned and implemented
Order of Court sanctioning the Scheme registered at
the South African Registrar of Companies on or
about Wednesday, 14 January
Results of the Court sanctioning the Scheme
announced on SENS on Wednesday, 14 January
Results of the Court sanctioning the Scheme
announced in the press on Thursday, 15 January
Last day for Shareholders to trade to be recorded
in the register of Shareholders or in the
sub-registers of Pepkor administered by a
CSDP on the consideration record date Friday, 16 January
Suspension of the listing of Pepkor ordinary
shares on the JSE Securities Exchange South Africa
("JSE") at the commencement of trade on Monday, 19 January
Consideration record date, being the date on which
Shareholders must be recorded in the Pepkor
register of Shareholders or in the relevant
sub-registers administered by CSDPs on the
consideration record date, to be eligible to
participate in the scheme consideration Friday, 23 January
Posting of Election and Surrender circular (see note 2) Monday, 26 January
Election period commences Monday, 26 January
Election Period closes on the election record date
at 14:30 on Friday,13 February 2004, being the
latest date and time by which scheme participants
must have elected to receive either the Cash
Consideration or the Reinvestment Alternative
in accordance with the
instructions to be contained in the Election and
Surrender circular, which elections must be delivered
to the transfer secretaries of Pepkor by 14:30 on Friday, 13 February
Operative date of the Scheme from the commencement
of trading on (see note 4) Monday, 16 February
Delisting of Pepkor"s ordinary shares on the JSE
from the commencement of trading on Tuesday, 17 February
Note:
1. The above dates and times are subject to change and any change will be
published by Pepkor on SENS and in the South African press.
2. Subsequent to the sanctioning of the Scheme by the Court an Election and
Surrender circular will be posted to all scheme participants on the first
business day following the consideration record date. This Election and
Surrender circular will, inter alia, contain information on the election by
scheme participants, to be made during the election period, to receive the
scheme consideration in cash or to elect the Reinvestment Alternative. Should a
scheme participant not make a valid election in accordance with the instructions
to be contained in the Election and Surrender circular, the scheme participant
will be deemed to have elected the Cash Consideration in respect of all his/her
Pepkor ordinary shares.
3. Share certificates may not be dematerialised or rematerialised after Friday,
16 January 2004.
4. Scheme participants will receive the scheme consideration, being either the
Cash Consideration or the Castellina ordinary shares and loan claims credited
under the Reinvestment Alternative, within five business days of the fulfillment
of all the suspensive conditions provided that they validly exercise their
election and, where applicable, provided that the documents of title for their
Pepkor ordinary shares have been received by the transfer secretaries of Pepkor.
4. SUPPLEMENTARY INFORMATION
4.1 Arrangement with the preference shareholder
4.1.1 As an integral part of the Scheme, Pepkor and Castellina have
entered into an arrangement with the preference shareholder, being
Fincom (Proprietary) Limited, a company which is under the ultimate
control of
CH Wiese and which holds all of Pepkor"s preference shares ("the
Preference Shareholder"). In terms of this agreement, Castellina will
pay the Preference Shareholder R33,3 million for the loss of all
rights conferred by the Pepkor preference shares on the redemption of
these shares by Pepkor on the implementation of the Scheme. This
obligation will be discharged by allotting and issuing 33 300 000
Castellina ordinary shares to the Preference Shareholder.
4.1.2 The Preference Shareholder has agreed that all the bridging
loan claims which would otherwise have been credited to it in terms of
the Reinvestment Alternative by virtue of the Pepkor ordinary shares
held by it, will be subordinated to all other bridging loan claims of
Castellina and will be credited as class "A" loan claims.
4.1.3 The Preference Shareholder has also agreed to waive its rights
to receive such class "A" loan claims which would otherwise have been
credited to it in terms of the Reinvestment Alternative by virtue of
the Pepkor ordinary shares held by it at the operative date of the
Scheme as would have had a face value of R33,3 million.
4.1.4 The effect of the waiver in 4.1.3 above is that the Preference
Shareholder will effectively receive an amount of R9.2755 in respect
of each Pepkor ordinary share held by it. Accordingly, on
implementation of the Scheme, the Preference Shareholder will, by
virtue of its holding of Pepkor ordinary shares and Pepkor preference
shares, in aggregate, receive R459 604 620, which is equivalent to R10
per Pepkor ordinary share.
4.2 Rule 13 of the Code
4.2.1 Rule 13 of the Securities Regulation Code on Takeovers and
Mergers ("Code") regulates special deals with favourable conditions
and provides that " ...Except with the consent of the Panel, an
offeror or persons acting in concert with it shall not make any
arrangements with holders of the relevant securities and shall not
deal or enter into arrangements to deal in securities of the offeree
company, or enter into arrangements which involve acceptance of an
offer, either during an offer or when one is reasonably in
contemplation, if there are favourable conditions attached which are
not being extended to all holders of relevant securities..."
4.2.2 The Executive Director of the Securities Regulation Panel
("SRP") is of the view that, notwithstanding the equality in the
aggregate consideration to be received by the Preference Shareholder
in terms of the Scheme (when divided by the number of Pepkor ordinary
shares held by the Preference Shareholder), the composition of such
aggregate consideration will differ in respect of the mix of the
Castellina ordinary shares and loan claims, from that to be received
by other scheme participants. The SRP is of the view that such
differentiation constitutes a "special condition" within the meaning
of the Code.
4.2.3 The SRP has nevertheless approved the circular to Shareholders
and consented in terms of Rule 13 of the Code to the Scheme proceeding
and has granted an exemption in terms of Rule 34 of the Code from
strict compliance with the Code, provided that:
4.2.3.1 not only is the Scheme to be approved by a majority
representing not less than three-fourths of the votes exercisable by
the relevant scheme members present and voting either in person or by
proxy at the scheme meeting by scheme members eligible to attend and
vote thereat, but
4.2.3.2 also that the majority required by 4.2.3.1 above includes
the votes of a simple majority (being 50% plus 1 of those present and
voting at the Scheme meeting) of the independent Scheme Members (see
4.3.3.1 below).
4.2.4 The full terms of the ruling by the Executive Director of the
SRP have been included in the circular to Shareholders and announced
on SENS on Tuesday, 25 November 2003. A signed copy of this ruling is
also available for inspection at the office of Pepkor"s sponsor
Barnard Jacobs Mellet Corporate Finance (Pty) Limited, at 2nd Floor,
Barnard Jacobs Mellet House, 5 Sturdee Avenue, Rosebank, 2196 or at
the office of the lead and transaction sponsor Exchange Sponsors
(Proprietary) Limited at Hyde Park Manor, 79 Hyde Park Lyne, Hyde
Park, 2196.
4.3 Suspensive conditions
4.3.1 As described in the Terms Announcement, the Offer is
conditional upon the fulfilment of certain suspensive conditions by no
later than 30 June 2004.
4.3.2 Shareholders are advised that the suspensive condition that the
underwriters have to be assured of obtaining not less than 30% of the
total issued ordinary share capital of Castellina, as previously set
out in 6.1.6 of the Terms Announcement, has been amended to provide
that only the following two underwriters namely, South African Private
Equity Fund III L.P. ("SAPEF") and South African Private Equity Trust
III ("SAPET") both private equity funds under the management of Brait
S.A., collectively, receive not less than 15% of the total issued
share capital of Castellina, (after taking into account all the
Castellina ordinary shares to be issued in terms of the Scheme and the
issue of Castellina ordinary shares to a trust in terms of the new
executive share incentive scheme), provided that this condition shall
be deemed to be fulfilled if SAPEF and SAPET inform Castellina and
Pepkor in writing that they waive the benefits of this condition.
4.3.3 The following new suspensive condition required by the SRP in
terms of 4.2.3.2 above has been incorporated into the relevant
agreements:
4.3.3.1 unless this condition is waived by the SRP by a ruling
to such effect, that a majority representing not less than three-
fourths of the votes exercisable by the relevant scheme members
present and voting either in person or by proxy at the scheme
meeting by scheme members eligible to attend and vote thereat,
includes a simple majority (being 50% plus 1 of those present and
voting at the scheme meeting) of independent scheme members.
Independent scheme members are such group of scheme members as
meet criteria to be determined prior to the scheme meeting by the
Executive Director of the SRP after due consideration by him of
the register of shareholders of Pepkor and such written and oral
representations as he may receive from registered shareholders
and other interested parties, which group shall at least exclude
the Preference Shareholder, all entities directly or indirectly
controlled by CH Wiese which have an interest in Pepkor; Old
Mutual Life Assurance Company (South Africa) Limited ("OMLACSA"),
(which is the beneficial owner of 14 235 626 Pepkor ordinary
shares); and companies deemed to be acting in concert with
OMLACSA in terms of Section 440A(2)(a) of the Companies Act;
5. FAIR AND REASONABLE AND RECOMMENDATIONS
5.1 The Pepkor board of directors ("the Pepkor Board") appointed Absa
Corporate and Merchant Bank, Corporate Finance, a division of Absa Bank
Limited ("ACMB"), to consider the terms of the Offer, including the payment
to the Preference Shareholder (see 4.1.1 above).
5.2 ACMB has considered these matters and:
5.2.1 in respect of the Cash Consideration of R10 per Pepkor ordinary
share, is of the opinion that the offer price is fair and reasonable,
5.2.2 in respect of the Reinvestment Alternative, is of the opinion
that the Reinvestment Alternative is fair and reasonable after
considering the following significant factors:
5.2.2.1 Castellina will be an unlisted company whose ordinary shares
will not be easily tradeable and whose class "A" loan claims and
bridging loan claims will be repaid from the cash flow of Castellina;
5.2.2.2 Castellina, in terms of normal private equity transactions,
will be highly geared in terms of its debt to equity ratio; and
5.2.2.3 the ultimate investment decision to accept the Reinvestment
Alternative compared to the Cash Consideration of R10 will depend upon
the individual risk and investment profile of the particular Pepkor
ordinary shareholder.
5.2.3 In respect of the payment of R33,3 million for the Pepkor
Preference Shares, and after giving cognisance to the ruling by the
Executive Director of the SRP (see 4.2 above), ACMB is of the opinion
that this payment is fair and reasonable.
5.3 The Pepkor Board agrees with the opinion of ACMB and, accordingly,
recommends that scheme members vote in favour of the Scheme. The Pepkor
Board members, in respect of their own holdings of Pepkor ordinary shares,
intend to vote in favour of the Scheme at the scheme meeting.
6. CIRCULAR
A circular containing full details of, inter alia, the Scheme and the actions
required by Shareholders will be posted to Pepkor ordinary shareholders on
Wednesday, 26 November 2003.
Cape Town
25 November 2003
Corporate advisor to Castellina
BRAIT
Corporate advisor to Pepkor
JAVELIN CAPITAL LIMITED
(Registration number 2000/010500/06)
Attorneys to Pepkor
JAN DE VILLIERS ATTORNEYS
Auditors and reporting accountants
PricewaterhouseCoopers Inc.
Chartered Accountants (SA)
Registered Accountants & Auditors
(Registration no. 1998/012055/21)
Joint attorneys to Castellina
Read Hope Phillips Attorneys
Joint attorneys to Castellina
MALLINICKS ATTORNEYS
Independent advisor to Pepkor
ABSA
Corporate & Merchant Bank
Transaction and lead sponsor
Exchange Sponsors
Sponsor to Pepkor
Barnard Jacobs Mellet
Corporate Finance
Tax advisor
Deloitte & Touche Chartered Accountants (SA)
Registered Accountants and Auditors
Debt financier
OLD MUTUAL
Specialised Finance
Date: 25/11/2003 03:55:10 PM Supplied by www.sharenet.co.za
Produced by the JSE SENS Department
