| Fri 21 May 2004, 17:24 | | FINANCIAL EFFECTS OF THE ACQUISITION BY METBOARD |
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METBOARD PROPERTIES LIMITED - FINANCIAL EFFECTS OF THE ACQUISITION BY METBOARD
OF A PORTFOLIO OF PROPERTIES FROM SUBSIDIARY COMPANIES OF LYONS CORPORATE LEASE
FUND (PROPRIETARY) LIMITED (`LCLFL`) AND CORRECTION
METBOARD PROPERTIES LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1998/005425/06)
Share code: MPL ISIN: ZAE000014874
(`Metboard`)
FINANCIAL EFFECTS OF THE ACQUISITION BY METBOARD OF A PORTFOLIO OF PROPERTIES
FROM SUBSIDIARY COMPANIES OF LYONS CORPORATE LEASE FUND (PROPRIETARY) LIMITED
(`LCLFL`) AND CORRECTION
1. Introduction
Metboard linked unitholders are referred to the announcement released on
the Securities Exchange News Service of the JSE Securities Exchange South
Africa on Thursday, 29 April 2004 (`the acquisition announcement`), in terms
of which it was announced that Metboard had entered into separate sale and
purchase agreements (`the sale and purchase agreements`) with the relevant
wholly or partly owned subsidiary companies of LCLFL (`the sellers`) for the
acquisition of 22 properties (`the properties`) for an aggregate purchase
consideration of R176 355 519 (`the acquisition consideration`), subject to
the terms and conditions as set out in the acquisition announcement (`the
acquisitions`).
In terms of the sale and purchase agreements, the acquisition consideration
will be settled as to:
- R35 271 104, representing 20% of the acquisition consideration, through the
issue of 11 341 191 new Metboard linked units at a price of 311 cents per
linked unit (`the consideration units`); and
- the balance of R141 084 415, representing 80% of the acquisition
consideration, in cash (`the cash consideration`).
2. Pro forma financial effects of the acquisitions
The table below sets out the pro forma financial effects of the acquisitions
on the headline earnings and distribution per Metboard linked unit for the
six-month period ended 30 September 2003 and on the net asset value and
tangible net asset value per Metboard linked unit at 30 September 2003. The
pro forma financial effects are presented for illustrative purposes only and
may not give a fair reflection of the financial position of Metboard post the
implementation of the acquisitions.
Per Metboard linked unit Pro forma Adjustments Pro forma
before the after the Change
acquisitions acquisitions (%)
Headline earnings (cents) 18,03 (0,73) 17,30 (4,05)
Distribution (cents) 18,00 (0,73) 17,27 (4,06)
Net asset value (cents) 309,72 0,06 309,78 0,02
Tangible net asset value (cents) 309,72 0,06 309,78 0,02
Notes:
The ` Pro forma after the acquisitions` column assumes:
1. the properties had been transferred and registered into the name of
Metboard with effect from 1 April 2003 and the net property income
attributable to the properties for the six-month period ended 30 November 2003
was earned by Metboard for the six-month period ended 30 September 2003;
2. an average interest rate of 11,5% on the cash consideration was incurred by
Metboard for the six-month period ended 30 September 2003;
3. the acquisitions were implemented with effect from 1 April 2003 and the
consideration units were in issue for the full six-month period ended 30
September 2003 for the calculation of Metboard`s headline earnings per linked
unit and distribution per linked unit;
4. the acquisitions were implemented on 30 September 2003 and the
consideration units were issued on 30 September 2003 for the calculation of
Metboard`s net asset value per linked unit and tangible net asset value per
linked unit; and
5. the pro forma headline earnings per linked unit and distribution per linked
unit were based on a weighted average of 216 126 768 Metboard linked units in
issue during the six-month period ended 30 September 2003.
The `Pro forma after the acquisitions` column does not take into account the
net property income attributable to the Quality Products building for the
calculation of headline earnings per linked unit and distribution per linked
unit as this building was acquired with effect from November 2003 by the
relevant seller.
3. Correction
Metboard linked unitholders are referred to the acquisition announcement in
terms of which it was announced that, solely for the purpose of finalising
the mechanism for the calculation of the antecedent divestiture for inclusion
in the sale and purchase agreements, Metboard and the sellers had agreed to an
antecedent divestiture of a pro rata portion of an agreed 21 cents per
Metboard consideration unit (`the antecedent divestiture`) in relation to
Metboard`s distribution for the six-month period ending 30 September 2004
(`the September distribution`). Metboard linked unitholders are hereby advised
that the antecedent divestiture was misstated in the acquisition announcement
and that it should have been disclosed as an antecedent divestiture of a pro
rata portion of an agreed 18 cents per consideration unit (`the revised
antecedent divestiture`) as contained in the sale and purchase agreements.
The consideration units will be issued by Metboard to the sellers upon the
transfer of the properties into the name of Metboard, which is anticipated to
take place after 1 July 2004 but prior to the last day to trade in order to
participate in the September distribution. As a result, the sellers, to the
extent that they are still holders of the consideration units, will receive
the full September distribution even though they will not be entitled to a
portion of such distribution. To the extent that the revised antecedent
divestiture is overpaid, the difference between the revised antecedent
divestiture and the actual September distribution will be repaid by Metboard
to the sellers and to the extent that the revised antecedent divestiture is
underpaid, Metboard will receive from the sellers the difference between the
revised antecedent divestiture and the actual September distribution. Metboard
linked unitholders are advised that the revised antecedent divestiture of 18
cents is not a profit forecast, but represents an amount arrived at solely for
the purpose of finalising the mechanism for the calculation of the revised
antecedent divestiture to be included in the sale and purchase agreements.
4. Documentation
Given the monetary value of the acquisitions, Metboard linked unitholder
approval is not required for the implementation of the acquisitions. A
circular, for information purposes only, setting out all relevant information
relating to the acquisitions will be posted to Metboard linked unitholders on
or about 2 June 2004.
5. Withdrawal of cautionary announcement
Metboard linked unitholders are referred to the acquisition announcement and
are advised that as the pro forma financial effects of the acquisitions have
now been published, caution is no longer required when dealing in their
Metboard linked units.
By order of the Board
Sandton
21 May 2004
Merchant bank
Investec Corporate Finance
Investec Bank Limited
(Registration number 1969/004763/06)
Sponsor
Investec Bank Limited
(Registration number 1969/004763/06)
Date: 21/05/2004 05:03:56 PM Produced by the JSE SENS Department
