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L.a. Group Limited - Specific Repurchase Of Shares
Release Date: 10/06/2004 16:09:00 Code(s): LAN LAR
L.A. GROUP LIMITED - SPECIFIC REPURCHASE OF SHARES
L.A. GROUP LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1936/008786/06)
JSE Share Code: LAR
ISIN: ZAE000028676
JSE Share Code: LAN
ISIN: ZAE000028684
(`L.A. Group` or `the company`)
SPECIFIC REPURCHASE OF L.A. GROUP SHARES
1. INTRODUCTION
Shareholders are advised that the company has entered into an agreement
with Sanlam Investment Management, a division of Sanlam Life Insurance
Limited (`Sanlam`) in terms of which it will, subject to the conditions
precedent set out below, acquire 756 373 L.A. Group ordinary shares and 8
327 874 L.A. Group `N` ordinary shares (`the repurchase shares`) held by
Sanlam on behalf of its clients, at a price of 280 cents per share (`the
specific repurchase`).
2. THE SPECIFIC REPURCHASE
2.1 Terms Of The Specific Repurchase
Subject to the fulfilment of the conditions precedent set out in 2.3 below,
L.A. Group will repurchase the repurchase shares from Sanlam for a
repurchase price of R25 435 891 (`the repurchase price`) with effect from 1
September 2004.
2.2 Rationale
The board of directors of L.A. Group are of the opinion that the specific
repurchase offers the company an opportunity to enhance its earnings and
net asset value by acquiring its own shares at a reasonable price.
2.3 Conditions Precedent
The specific repurchase is conditional upon, inter alia, the following
conditions precedent:
2.3.1 The requisite approvals being received from the JSE
Securities Exchange South Africa (`the JSE`);
2.3.2 The approval of the special resolutions required to
authorise the specific repurchase by L.A. Group shareholders
in general meeting; and
2.3.3 Registration of the special resolutions by the Registrar of
Companies.
2.4 Funding For The Specific Repurchase
R25 million of the repurchase price will be financed by a financial
institution and the balance will be funded by internal cash resources.
The financial institution will be repaid as follows:
2.4.1 R10 million on 1 February 2005
2.4.2 R10 million on 1 August 2005; and
2.4.3 R5 million on 1 February 2006.
The financial institution will take cession of the repurchased shares
and release same to the company for cancellation upon repayment of its
funding.
2.5 Treatment Of The Repurchased Shares
The company will, pursuant to the specific repurchase, terminate the
listing of the repurchased shares on the JSE and cancel such shares
upon release thereof by the financial institution as set out above.
2.6 Financial Effects
The following table and accompanying notes set out the unaudited pro
forma financial effects of the specific repurchase on the earnings per
share, headline earnings per share, net tangible asset value and net
asset value per share of the company based on the published
reviewed results for the year ended 29 February 2004. The table has
been prepared for illustrative purposes only to provide information on
how the specific repurchase might have effected the financial
information presented and, because of its nature, may not give a true
reflection of the effect of the specific repurchase.
Before(1) After Change
(cents) (cents) %
Earnings per ordinary and
`N` ordinary share
51.26 57.58(2) 12.3%
Headline earnings per
ordinary and `N` ordinary
share 52.08 58.56(2) 12.4%
Net asset value 444.44 477.17(3) 7.4%
Net tangible asset value
434.52 465.27(3) 7.1%
Weighted number of
ordinary and `N` ordinary 54 731 7792 45 647
shares in issue (`000) 532(2)
Number of ordinary and `N`
ordinary shares in issue 54 731 45 647
(`000) 779(2) 532(2)
Notes:
1. Based on the published reviewed results for the year ended 29 February
2004.
2. Based on the number of shares in issue of 62 001 701 less shares held in
treasury of 7 269 922.
3. Based on the assumptions that the specific repurchase was concluded and the
repurchased shares were cancelled on 1 March 2003; and an after-tax
interest rate of 7% on R25 000 000 and an after-tax interest rate of 4.9%
on R435 891 was applicable throughout the year.
4. Based on the assumption that the specific repurchase was concluded and the
repurchased shares were cancelled on 28 February 2004.
3. DOCUMENTATION AND GENERAL MEETING
A general meeting of shareholders will be held to approve the specific
repurchase. A circular containing full details of the specific repurchase
and convening the general meeting will be posted to shareholders in due
course.
Cape Town
10 June 2004
Sponsor
Sasfin Corporate Finance
A division of Sasfin Bank Limited
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