| Thu 24 Jun 2004, 17:29 | | Proposed Specific Share Repurchase |
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Aspen - Proposed Specific Share Repurchase Of 21 300 000 Aspen Ordinary Shares
Release Date: 24/06/2004 17:15:01 Code(s): APN
ASPEN - PROPOSED SPECIFIC SHARE REPURCHASE OF 21 300 000 ASPEN ORDINARY SHARES
FROM PEU HEALTH (PTY) LTD AND RENEWAL OF CAUTIONARY ANNOUNCEMENT
Aspen Pharmacare Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number 1985/002935/06)
JSE Share code: APN
ISIN: ZAE000023586
(`Aspen`)
PROPOSED SPECIFIC SHARE REPURCHASE OF 21 300 000 ASPEN ORDINARY SHARES FROM PEU
HEALTH (PROPRIETARY) LIMITED (`PEU HEALTH`) AND RENEWAL OF CAUTIONARY
ANNOUNCEMENT
1. Specific Share Repurchase
1.1 Introduction
Investec Bank Limited is authorised to announce that Aspen or a wholly
owned subsidiary of Aspen will, in terms of the share repurchase
agreement entered into between Aspen and Peu Health dated 23 June
2004, acquire 21 300 000 Aspen shares (representing 5.9% of the
existing Aspen shares in issue net of treasury shares) from Peu Health
(`the specific share repurchase`), subject to the conditions precedent
set out in 1.5.
To the extent that shares are repurchased by a wholly-owned subsidiary
of Aspen, such shares will be held by the subsidiary as treasury
shares. To the extent that shares are repurchased directly by Aspen,
such shares will be cancelled as issued shares and will revert to
authorised but unissued share capital.
1.2 Rationale for the specific share repurchase
The funding arrangement utilised by Peu Health to acquire its holding
of 21 300 000 Aspen shares has had to be unwound and accordingly Peu
Health is required to dispose of its Aspen shares. Aspen is entering
into the specific share repurchase to facilitate an orderly exit by
Peu Health from its investment in Aspen.
Aspen may, subject to obtaining the prior approval of Aspen
shareholders, utilise some or all of the Aspen shares which are
subject to the specific share repurchase to facilitate further Black
Economic Empowerment (`BEE`). In this regard, shareholders are advised
that the cautionary announcement dated 6 May 2004 relates to ongoing
discussions between Aspen and a BEE consortium regarding the proposed
introduction of that consortium as a shareholder of Aspen (`the
proposed BEE transaction`).
CEPPWAWU Pharmaceutical Investments (Proprietary) Limited will remain
as a BEE shareholder in Aspen and will hold 7.9% of Aspen`s shares in
issue net of treasury shares after implementation of the specific
share repurchase.
1.3 Terms of the specific share repurchase
The share repurchase consideration of R234 300 000 (`the share
repurchase consideration`) is equivalent to 1 100 cents per Aspen
share and will be settled in cash from internal resources.
1.4 Financial effects of the specific share repurchase
The unaudited pro forma financial effects of the specific share
repurchase, as set out in the table below, have been prepared for
illustrative purposes only and to provide information on how the
specific share repurchase may have impacted the historic financial
results of Aspen. Because of their nature, the unaudited pro forma
financial effects may not give a fair reflection of Aspen`s financial
position after the implementation of the specific share repurchase or
the effect on future earnings.
The table below sets out the unaudited pro forma financial effects of
the specific share repurchase on earnings, headline earnings, net
asset value and net tangible asset value per Aspen share, subject to
the assumptions set out below.
Actual Pro forma Increase/
`Before` `After` (decrease)
(cents) (cents) (%)
Basic earnings per share
for the six months ended 44.9 45.3 0.9
31 December 20032
Headline earnings per
share for the six months 47.2 47.7 1.1
ended 31 December 20032
Net asset value per share
at 31 December 20033 248.8 194.6 (21.8)
Net tangible asset value
per share at 31 December 105.7 42.4 (59.9)
20033
Number of shares in issue
at 31 December 2003, net 356 309 335 009
of treasury shares (`000)
Weighted average number of
shares in issue for the
six months ended 31 355 773 334 473
December 2003, net of
treasury shares (`000)
Notes:
1. The actual `before` financial information has been extracted,
without adjustment, from the unaudited interim financial results
of Aspen for the six months ended 31 December 2003.
2. The unaudited pro forma `after` basic and headline earnings per
share calculations have been based on the following assumptions:
* the specific share repurchase was implemented on 1 July
2003; and
* the share repurchase consideration was funded from internal
resources which would otherwise, but for the specific share
repurchase, have been invested by Aspen in an interest
bearing account at an average after tax rate of 7% for the
six months ended 31 December 2003.
3. The unaudited pro forma `after` net asset value and net tangible
asset value per share calculations have been based on the
assumption that the specific share repurchase was implemented on
31 December 2003.
1.5 Conditions precedent
The specific share repurchase is subject to the following conditions
precedent:
1.5.1 the passing of the requisite resolutions by Aspen
shareholders in general meeting approving the specific share
repurchase in accordance with the Companies Act, 1973 (Act
61 of 1973), as amended, and the Listings Requirements of
the JSE Securities Exchange South Africa (`the JSE`);
1.5.2 the registration of the requisite special resolution by the
Registrar of Companies; and
1.5.3 the granting, to the extent required, of all regulatory
approvals for the specific share repurchase, including
approval by the JSE.
It is anticipated that the specific share repurchase and the delisting
of any shares acquired directly by Aspen will be implemented on or
about Friday, 30 July 2004.
1.6 Documentation and general meeting
A circular containing full details of the specific share repurchase
and convening a general meeting of Aspen shareholders (`the general
meeting`) to pass the requisite resolutions to approve the specific
share repurchase will be sent to Aspen shareholders in due course.
In terms of the JSE Listings Requirements, the special resolution
necessary to give effect to the specific share repurchase will be
required to be passed by at least 75% of the shareholders present in
person or by proxy and voting at the general meeting, excluding any
parties participating in the specific share repurchase. Consequently,
Peu Health will not be eligible to vote in respect of their
shareholding at the general meeting for the purpose of approving the
specific share repurchase.
2. Renewal Of Cautionary Announcement
Further to the cautionary announcement dated 6 May 2004, shareholders are
advised that discussions in respect of the proposed BEE transaction are
still in progress which, if successfully concluded, may have a material
effect on the price of Aspen shares. Accordingly, shareholders should
continue exercising caution when dealing in Aspen shares until a full
announcement is made.
Sandton
24 June 2004
Merchant bank
Investec Corporate Finance
Sponsor
Investec Securities
Reporting accountants and auditors
PricewaterhouseCoopers Inc.
Attorneys
Werksmans Inc.
