| Thu 26 Aug 2004, 10:26 | | Acquisition Of A Strategic Interest In Clough Ltd |
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Murray & Roberts - Acquisition Of A Strategic Interest In Clough Limited
Murray & Roberts Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number 1948/029826/06)
Share code: MUR ISIN: ZAE000008983
(`Murray & Roberts` or `the company`)
ACQUISITION OF A STRATEGIC INTEREST IN CLOUGH LIMITED
Introduction
Shareholders are advised that Murray & Roberts has entered into an agreement
dated 25 August 2004 with Clough Limited (`Clough`, ASX:CLO) and McRae
Investments Pty Ltd (`McRae`) representing the Clough family interests in
Clough, that will result in Murray & Roberts holding 29.28% of the shares in
Clough.
Listed on the Australian Stock Exchange, Clough is one of Australia`s largest
multi-disciplinary engineering and contracting groups. It operates globally in
industry sectors such as onshore and offshore oil and gas, petrochemicals,
minerals, infrastructure and property and has a significant capability in
project management, engineering and construction and facilities installation,
operations and maintenance.
In terms of the agreement and subject to the fulfilment of certain conditions
precedent set out in paragraph 2 below, Murray & Roberts will:
* subscribe for 60 million new shares in Clough (`subscription`) for a total
consideration of A$40.8 million (`subscription consideration`); and
* acquire 60 million shares in Clough from McRae (`acquisition`) for a total
consideration of A$40.8 million (`acquisition consideration`),
(collectively `transaction`). The subscription and acquisition are indivisible
transactions. At current exchange rates, the value of the transaction would
amount to approximately ZAR 380 million.
The transaction
Terms and conditions
Murray & Roberts currently holds a 4.9% interest in Clough. Following the
transaction, Murray & Roberts will hold a 29.28% shareholding in Clough and
McRae will hold 34.62% of Clough shares. The transaction is subject to
fulfilment of the following conditions precedent, which are expected to be
fulfilled on or about 4 November 2004 (`effective date`):
* approval of the transaction by Clough shareholders in general meeting;
* confirmation of no objection by the Australian Foreign Investment Review
Board; and
* approval by the South African Reserve Bank.
* satisfactory completion of a due diligence review by Murray & Roberts.
Upon fulfilment of the conditions precedent, Murray & Roberts will:
subscribe for 60 million new shares in Clough at A$0.68 per share. The
subscription consideration will be paid to Clough upon the issue of the new
Clough shares, expected to be completed in early November 2004; and
acquire 60 million shares in Clough from the Clough family at A$0.68 per share.
The acquisition consideration will be paid to the Clough family on the date of
transfer of the shares to Murray & Roberts.
Both the subscription consideration and acquisition consideration will be funded
by Murray & Roberts from internal capacity.
Other significant terms of the agreement
The new Clough shares acquired by Murray & Roberts in terms of the subscription
will be subject to a voluntary escrow period of 12 months.
Murray & Roberts and McRae will enter a shareholders agreement relating to their
investment in Clough that will include the grant of certain rights to Murray &
Roberts in relation to the remaining Clough shares held by McRae.
Once the initial acquisition is complete, Murray & Roberts and McRae will have
aggregate interest in 63.9% of the issued share capital of Clough.
Murray & Roberts, subject to market conditions, may decide to acquire up to a 3%
interest in Clough every six months as permitted by the Australian Corporations
Act.
It is expected that upon fulfilment of the conditions precedent, two
representatives of Murray & Roberts will join the Clough board of directors.
The agreement provides for establishing an equal joint venture between Clough
and Murray & Roberts, focused in Australia and Southeast Asia, to address
additional opportunities, particularly in relation to metals and minerals
extraction, processing and industrial plant facilities associated with the
resources sector.
Rationale
The principal objective of the agreement between Murray & Roberts and McRae is
to develop the business of Clough and to provide Murray & Roberts with an
operational presence in Southeast Asia in pursuit of Globalising Murray &
Roberts as a growth strategy. This strategic relationship establishes the
framework for expanded global opportunities and should deliver significant
mutual advantages by the blending of each party`s geographic and specialist
focus and strengths.
It is expected that the strategic relationship will add further value by
introducing Clough into regions of the world where Murray & Roberts has a
leading presence, with a particular focus on new oil and gas business
opportunities in the Middle East and the west coast of Africa. In turn, it
provides Murray & Roberts with access into the engineering and contracting oil
and gas sector.
Financial effects
The transaction is not expected to have a material effect on the financial
results for the year to 30 June 2005.
Johannesburg
25 August 2004
Corporate advisor to Murray & Roberts: Euroz Corporate
Sponsor to Murray & Roberts: Merrill Lynch South Africa (Pty) Limited
Legal advisor to Murray & Roberts: Blake Dawson Waldron
Transaction support to Murray & Roberts: Bridge Capital
Date: 26/08/2004 08:00:09 AM
Produced by the JSE SENS Department
