| Mon 29 Mar 2004, 9:04 | | OLD MUTUAL - ANNOUNCEMENT |
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OLD MUTUAL - ANNOUNCEMENT
Old Mutual
Mutual & Federal Investments (Proprietary) Limited
(Incorporated in the Republic of South Africa)
(Registration number 1970/006620/07)
("M&F Investments")
(a wholly-owned subsidiary of Old Mutual (South Africa) Limited)
UNCONDITIONAL OFFER BY M&F INVESTMENTS, A WHOLLY-OWNED SUBSIDIARY OF OLD MUTUAL
(SOUTH AFRICA) LIMITED ("OMSA") TO ACQUIRE THE ENTIRE ISSUED SHARE CAPITAL OF
MUTUAL & FEDERAL INSURANCE COMPANY LIMITED ("MUTUAL & FEDERAL")
1. Introduction
Mutual & Federal announced on SENS on Tuesday 20 January 2004 OMSA"s (or its
nominee"s) firm intention to propose a scheme of arrangement between Mutual &
Federal and its shareholders other than M&F Investments ("the scheme") which, if
implemented, would result in Mutual & Federal becoming a wholly-owned subsidiary
of OMSA and the listing of the Mutual & Federal shares on the JSE and the NSX
being terminated.
It was also announced that if the scheme should not be proposed or be
unsuccessful, OMSA (or its nominee) would make an offer ("the offer"), for the
same cash consideration, to acquire all of the Mutual & Federal shares, other
than those already held by M&F Investments ("the offer shares").
On Monday 8 March 2004 the board of directors of Mutual & Federal announced that
it had considered the terms of the scheme and the offer and was of the opinion
that the terms and conditions thereof were not fair and reasonable to Mutual &
Federal shareholders.
Since the scheme will not be proposed, M&F Investments, being the nominee of
OMSA, hereby makes the offer to Mutual & Federal shareholders (other than M&F
Investments) ("the offerees") on the terms set out below.
RSA Overseas Holdings (Luxembourg) (No. 1) s.a.r.l.("RSA"), which holds 90 961
150 Mutual & Federal shares constituting 37.1% of the issued share capital of
Mutual & Federal (or 74.4% of the offer shares), has irrevocably undertaken, in
terms of an agreement concluded with OMSA on 19 January 2004 ("the RSA/OMSA
agreement"), to accept the offer in respect of all the Mutual & Federal shares
that it owns and to waive the offer consideration in excess of R14,77 in respect
of those shares.
2. Terms of the offer
2.1 The offer consideration
The offer consideration for every offer share held by an offeree who has
accepted the offer ("offer participant") and in respect of which the offer is
accepted, will be 1 702 cents in cash ("the offer consideration"), being 1 750
cents less the final dividend of 48 cents per share declared by Mutual & Federal
in respect of the 2003 financial year ("the final dividend") and payable to
shareholders recorded in the register on 19 March 2004. The salient dates and
times relating to the offer are set out in paragraph 7 below.
2.2 Offer unconditional
The implementation of the offer and payment of the offer consideration is not
conditional upon any minimum level of acceptances and is not subject to any
conditions.
3. Cash confirmation
The SRP has been given appropriate confirmation in terms of its requirements
that M&F Investments has sufficient resources available to it to satisfy full
acceptance of the offer.
4. M&F Investments" intention regarding Mutual & Federal
Should the offer be accepted by the offerees in respect of nine-tenths or more
of the offer shares, M&F Investments will invoke the provisions of section 440K
of the Companies Act 61 of 1973 ("the Act") to compulsorily acquire all the
offer shares in respect of which the offer was not accepted and apply for the
termination of the listing of Mutual & Federal.
If section 440K of the Act cannot be invoked, Mutual & Federal will continue as
a listed company and the board of directors of Mutual & Federal will remain
substantially unchanged.
Mutual & Federal will continue as a short-term insurer.
5. Special Arrangements
In terms of the RSA/OMSA agreement RSA has undertaken to pay to a bank nominated
by Old Mutual plc and with such bank acting as principal, a rand amount equal to
the offer consideration which RSA receives in terms of the offer, namely R1 343
million, plus the amount of the final dividend, namely R44 million (amounting to
a total of R1 387 million). Such bank will in turn pay to RSA GBP100 million. In
terms of the same agreement, Old Mutual plc will then pay to the said bank in UK
pounds, such consideration as may be agreed between Old Mutual plc and the said
bank, and will receive R1 387 million in return. Old Mutual plc has entered
into an agreement with Nedbank Limited (London Branch) to act as the said bank.
To the extent that the offer consideration exceeds 1477 cents per offer share,
(being 1525 cents less the final dividend), RSA has agreed to waive such excess
amount in respect of all of the offer shares it owns.
On 2 March 2004 OMSA assigned its rights and obligations in terms of the
RSA/OMSA agreement to M&F Investments.
The offer shall not be extended to option holders in their capacity as option
holders under the Mutual & Federal share option scheme. If, however, section
440K of the Act is invoked, M&F Investments will make an appropriate offer to
option holders.
6. Circular and response by the board of directors of Mutual & Federal
A circular to shareholders setting out the full terms of the offer was posted to
shareholders today, 29 March 2004. In terms of the Securities Regulation Code on
Takeovers and Mergers and the Rules of the Securities Regulation Panel, the
board of directors of Mutual and Federal is obliged to make a statement to
Mutual & Federal shareholders within 14 days of the opening of the offer.
7. Salient dates and times
Offer opens at 09:00 on Monday 29 March 2004
Last day for Mutual & Federal shareholders to
trade in Mutual & Federal shares on the JSE
and the NSX to be eligible to participate in the offer Thursday 22 April 2004
Mutual & Federal shares trade "ex" the offer Friday 23 April 2004
Record date for participating in the offer Friday 30 April 2004
Closing date of the offer at 12:00 on Friday 30 April 2004
Results of offer announced on SENS Monday 3 May 2004
Results of offer published in the press Tuesday 4 May 2004
Notes:
1. Any changes to the above dates and times will be released on SENS and
published in the press.
2. All times given in this announcement are local times in South Africa.
3. M&F Investments reserves the right to extend the closing date, in which
event all amended dates and times relating to the offer will be released on SENS
and published in the press as noted in note 1 above.
4. Dematerialised shareholders are required to notify their CSDP or broker, as
the case may be, of their intention to accept the offer in the manner and time
stipulated in the custody agreement entered into between such shareholders and
their CSDP or broker.
5. Certificated shareholders wishing to accept the offer are required to
complete the form of acceptance, surrender and transfer (attached to the
circular) in accordance with the instructions therein to be received by no later
than 12:00 on the closing date.
5. The offer consideration due to:
a. dematerialised offer participants will be paid into his/her account with
his/her CSDP or broker at his/her risk and dealt with in terms of the custody
agreement entered into between the offer participant and his/her CSDP or broker
within five business days after the date on which acceptance of the offer was
received by the transfer secretaries;
b. certificated offer participants will, unless prior arrangements have been
agreed to with M&F Investments, be posted, by ordinary post, at the risk of the
Mutual & Federal shareholder concerned, within five business days of the receipt
of the form of acceptance, surrender and transfer attached to the circular,
together with the relevant document(s) of title (in negotiable form) provided
such acceptances have been validly received before 12:00 on the closing date.
6. No dematerialisation or rematerialisation of Mutual & Federal shares will
take place during the period commencing on the day after the last day for Mutual
& Federal shareholders to trade in Mutual & Federal shares on the JSE to be
eligible to participate in the offer and terminating on the closing date.
Cape Town
29 March 2004
Sponsor to Old Mutual plc (the ultimate holding company of M&F Investments)
Merrill Lynch
Corporate law advisers and consultants to M&F Investments
Edward Nathan & Friedland (Proprietary) Limited
