| Fri 6 Aug 2004, 8:49 | | Announcement Regarding An Odd-Lot Offer |
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Metropolitan Holdings Limited - Announcement Regarding An Odd-Lot Offer
Metropolitan Holdings Limited
(Incorporated in the Republic of South Africa)
Registration number: 2000/031756/06
(`Metropolitan`)
ISIN: ZAE000050456
JSE Share Code: MET
NSX Share Code: MTD
ANNOUNCEMENT REGARDING AN ODD-LOT OFFER
1. INTRODUCTION
1.1 In the circular to shareholders dated 4 November 2003, shareholders
were advised that the board had proposed an odd-lot offer in order to
reduce the number of shareholders who held odd-lots, being less than
100 shares in Metropolitan. The first odd-lot offer was necessitated
due to odd-lots having been created as a result of a previous
unbundling by New Africa Investments Limited (`NAIL`) of part of its
Metropolitan stake to its shareholders. The first odd-lot offer was
implemented on 15 December 2003.
1.2 Subsequent to the first odd-lot offer NAIL unbundled its remaining
Metropolitan stake to its shareholders. This has resulted in the
creation of numerous further odd-lot holdings in Metropolitan and
consequently, has necessitated Metropolitan undertaking a further odd-
lot offer to its shareholders who hold odd-lots.
2. RATIONALE
2.1 A breakdown of the composition of shareholders at 31 March 2004
revealed that:
- out of a total of 27 973 shareholders of listed Metropolitan
shares, 23 154 shareholders owned less than 100 Metropolitan
shares;
- the total holdings of these 23 154 shareholders constituted less
than 0.010% of the total issued share capital of Metropolitan;
- of these odd-lot holders, 22 273 owned less than 15 Metropolitan
shares;
- the total holdings of these 22 273 shareholders constituted less
than 0.006% of the total issued share capital of Metropolitan.
2.2 The minimum cost of executing a trade on the JSE Securities Exchange
South Africa (`JSE`) of an odd-lot holding of less than 100 shares
amounts to approximately R140.00 made up, inter alia, of brokerage
charges and Central Securities Depository Participant (`CSDP`) fees.
2.3 The closing price per Metropolitan share on 29 July 2004 amounted to
R7.30 and accordingly the value of 15 Metropolitan shares and 100
Metropolitan shares amounted to R109.50 and R730.00, respectively.
2.4 It is clear that for a shareholder holding 15 Metropolitan shares or
less, the cost of selling such Metropolitan shares exceeds their
value. In addition, for shareholders holding more than 15 but less
than 100 Metropolitan shares, the cost of selling such Metropolitan
shares is substantial in relation to the value of their holdings.
2.5 Furthermore, the annual total administration cost to Metropolitan in
respect of shareholders holding odd-lots amounts to approximately R2.8
million.
2.6 The board is of the view that shareholders holding odd-lots should be
afforded the opportunity of holding a more meaningful stake in
Metropolitan; alternatively, they should be offered a cost efficient
method of disposing of their Metropolitan shares without the negative
consequences detailed in paragraph 2.4 above.
2.7 The implementation of the odd-lot offer will also significantly reduce
the ongoing administrative cost to Metropolitan connected with a large
number of odd-lot holders without leading to Metropolitan being in
contravention of the minimum spread requirements of the JSE Listings
Requirements.
2.8 The board has accordingly proposed an odd-lot offer (subject to the
fulfilment of the conditions precedent referred to in paragraph 6
below) on the terms and conditions detailed in paragraph 3 below in
order to enable odd-lot holders:
- to acquire a more meaningful stake in Metropolitan; or
- to dispose of their odd-lots in a cost effective manner;
thereby reducing the number of odd-lot holders in an equitable manner.
3. TERMS OF THE ODD-LOT OFFER
3.1 All odd-lot holders will be afforded the opportunity to participate in
the odd-lot offer subject to the fulfilment of the conditions
precedent relating to the odd-lot offer. Shareholders should note that
this offer is a further odd-lot offer to the first odd-lot offer
proposed to shareholders in the circular of 4 November 2003 and all
shareholders who hold odd-lot holdings must again participate in the
odd-lot offer proposed in the circular posted to shareholders today, 6
August 2004 by exercising one of the options referred to in paragraph
3.2 below. Failure to do so will result in those shareholders` odd-lot
holdings being sold in terms of paragraph 4 below.
3.2 The odd-lot offer will open on Friday, 6 August 2004 and will be
implemented on the basis that odd-lot holders may, up to 12:00 on
Friday, 17 September 2004, elect to either:
3.2.1 acquire a sufficient number of additional Metropolitan
shares at the offer price in order to increase their
respective holdings to 100 Metropolitan shares; or
3.2.2 sell their odd-lot holdings to Metropolitan at the offer
price plus a 5% premium per Metropolitan share; or
3.2.3 retain their odd-lot holdings.
3.3 The aggregate number of Metropolitan shares which becomes available as
a result of the:
- odd-lot holders electing to sell their odd-lot holdings; or
- odd-lot holders being deemed to have sold their odd-lot holdings
because they failed to exercise any election,
will be used as far as is practicable or possible to satisfy the
demand for Metropolitan shares to be issued to those odd-lot holders
who have elected to increase their holding to 100 Metropolitan shares.
3.4 To the extent that the total number of such available shares is
insufficient to meet the aggregate requirement of those odd-lot
holders who have elected to increase their holding, new Metropolitan
shares will be issued, and to the extent that such available shares
exceed the aggregate number of shares to be issued to those odd-lot
holders who elect to increase their holding, such shares will be
repurchased by Metropolitan and cancelled.
3.5 Odd-lot holdings arising after the close of business on Friday, 17
September 2004 will not be entitled to participate in the odd-lot
offer and the odd-lot holders concerned will retain ownership of such
odd-lot holdings.
4. COMPULSORY SALE OF ODD-LOT HOLDINGS
The shares of those odd-lot holders who do not make an election or who do
not instruct their CSDP or broker as to their election, will be deemed to
have been sold to Metropolitan at the offer price plus a premium of 5%.
5. OFFER PRICE
The offer price per Metropolitan share will be equivalent to the volume
weighted average traded price of Metropolitan shares on the JSE over the
five trading days commencing on Tuesday, 24 August 2004 and ending on
Monday, 30 August 2004.
6. CONDITIONS PRECEDENT
The proposed odd-lot offer is subject to the special and ordinary
resolutions relating to the odd-lot offer being approved at the general
meeting referred to in paragraph 7 below and the special resolution being
registered by the Registrar of Companies.
7. GENERAL MEETING
A general meeting has been convened to be held in the Auditorium, 7 Parc du
Cap, Mispel Road, Bellville, Cape Town at 11:00 on Wednesday, 1 September
2004, for the purpose of considering and, if deemed fit, passing the
resolutions required to approve the proposed odd-lot offer, the specific
authority to repurchase odd-lots and the specific authority to issue shares
to odd-lot holders.
8. CIRCULAR
A circular to Metropolitan shareholders containing full details of the
proposed odd-lot offer and incorporating a notice of general meeting, a
form of proxy and a form of election and surrender will be posted to
shareholders on 6 August 2004.
9. IMPORTANT DATES AND TIMES
2004
Posting of circular and election period
for the odd-lot offer opens on Friday, 6 August
Forms of proxy to be received by the
transfer secretaries by 11:00 on Monday, 30 August
Offer price finalised and announced on the
JSE Securities Exchange News Service (`SENS`) on Tuesday, 31 August
Offer price published in the South African
and Namibian press on Wednesday, 1 September
General meeting of shareholders to be
held at 11:00 on Wednesday, 1 September
Results of the general meeting and finalisation
announcement published on SENS Wednesday, 1 September
Results of the general meeting and finalisation
announcement published in the South African and
Namibian press on Thursday, 2 September
Last day to trade in order to participate in/be
eligible for the odd-lot offer on Friday, 10 September
Shares trade `ex` odd-lot offer Monday, 13 September
Election period for the odd-lot offer closes at
12:00 on (see note 2) Friday, 17 September
Forms of election and surrender (together with
relevant documents of title/cheque/banker`s draft,
as applicable) for the odd-lot offer to
be received by the transfer secretaries
by 12:00 on (see note 2) Friday, 17 September
Record date to determine those shareholders
entitled to participate in the odd-lot offer
at the close of business on Friday, 17 September
Results of the odd-lot offer announced on SENS on Monday, 20 September
Implementation of the odd-lot offer
takes effect at the commencement of business on Monday, 20 September
Accounts of dematerialised odd-lot holders
updated and debited/credited at CSDP/broker
in respect of the odd-lot offer, cheques posted
to certificated odd-lot holders who have elected
to sell their odd-lots and share certificates
posted to certificated odd-lot holders
who have elected to acquire additional
shares, from Monday, 20 September
Results of the odd-lot offer published
in the South African and Namibian press on Tuesday, 21 September
NOTES:
1. Any Metropolitan shares purchased on the JSE or Namibian Stock Exchange
after Friday, 10 September 2004 will not be eligible to participate in the
odd-lot offer.
2. Dematerialised odd-lot holders are required to notify their duly appointed
CSDP of their election in respect of the odd-lot offer in the manner and
time stipulated in the custody agreement governing the relationship between
the odd-lot holder and his/her CSDP.
3. Certificated odd-lot holders who have elected by 12:00 on Friday, 17
September 2004 to acquire additional Metropolitan shares will be sent a
share certificate in respect of their new Metropolitan shares by registered
post from Monday, 20 September 2004 at the risk of the odd-lot holders
concerned. Cheques will be posted to certificated odd-lot holders who have
elected to sell their odd-lots from Monday, 20 September 2004 at the risk
of the odd-lot holders concerned.
4. Certificated shareholders should be aware that they will not be able to
trade their Metropolitan shares unless their share certificates have been
dematerialised. This period could be 24 hours up to 10 days, depending on
volumes processed. Shareholders may not dematerialise or rematerialise
their Metropolitan shares between Monday, 13 September 2004 and Friday, 17
September 2004, both days inclusive.
5. The above dates and times are subject to change. Any changes will be
published in the South African and Namibian press and released on SENS.
Cape Town
6 August 2004
Sponsor in South Africa
Merrill Lynch South Africa (Pty) Ltd
Legal adviser
Deneys Reitz Inc.
Sponsor in Namibia
Simonis Storm Securities (Pty) Ltd
Date: 06/08/2004 07:30:11 AM Produced by the JSE SENS Department
