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EOH - PURCHASE BY EOH OF THE REMAINING 30% SHAREHOLDING IN EOH CONSULTING
SERVICES WESTERN CAPE (PROPRIETARY) LIMITED
ENTERPRISE OUTSOURCING HOLDINGS LIMITED
Incorporated in the Republic of South Africa
(Registration number 1998/014669/06)
Share code: EOH ISIN: ZAE000022026
(`EOH` or `EOH Group`)
PURCHASE BY EOH OF THE REMAINING 30% SHAREHOLDING IN EOH CONSULTING SERVICES
WESTERN CAPE (PROPRIETARY) LIMITED (`EOH WESTERN CAPE`)
1. Introduction
Shareholders are advised that EOH has finalised an unconditional transaction
with S Stuttaford, L Mostert and B Goldblatt (`the related parties`) on 26 July
2004 relating to the proposed acquisition by EOH of the 30% equity interest that
it does not already own in EOH Western Cape from the executive directors of EOH
Western Cape (`the transaction`). The related parties are executive directors of
the company and each holds 10% of the shares in EOH Western Cape.
2. Rationale and terms
The transaction was concluded on standard terms for an acquisition of this
nature and will allow EOH to remove minority shareholders and simplify the Group
structure. The aggregate consideration for the transaction is R1 770 000 being
R360 000 in cash and R1 410 000 in EOH shares issued at R2,35 per share. The
effective date of the acquisition is 1 February 2004. All conditions precedent
have been fulfilled and regulatory approvals obtained.
3. Pro forma financial effects of the acquisition
Set out below are the pro forma financial effects of the transaction, the issue
of shares and the payment of cash as portion of the consideration based on the
published interim reviewed financial results of the company for the six months
ended 31 January 2004. This pro forma financial information has been prepared
for illustrative purposes only and because of its nature may not give a true
picture of EOH`s financial position and results of operations, nor the effect
and impact of the acquisition going forward.
Before the After the Change
acquisition acquisition (%)
Earnings per share (cents) 17,98 18,30 1,75
Headline earnings per share (cents) 19,08 19,44 1,88
Net asset value per share (cents) 118,06 119,43 1,16
Net tangible asset value per share (cents) 76,54 75,97 (0,74)
Actual number of shares in issue 50 667 356 51 267 356
Weighted average number of shares in issue 49 088 989 49 688 989
The pro forma financial effects in the `After the acquisition` column are based
on the following assumptions:
- the effect on net asset value and net tangible asset value per share is the
acquisition had been implemented on 31 January 2004;
- the effect on the earnings and headline earnings per share is based on 49
688 989 shares in issue during the period from 1 August 2003 to 31 January
2004 on the assumption that the acquisition was effected on 1 August 2003;
- an effective tax rate for the enlarged group of 30%;
- an after-tax interest charge of 4,4%; and
- the goodwill being amortised over 20 years.
4. Fair and reasonable opinion
The JSE has been provided with written confirmation from Merchant Sponsors
(Proprietary) Limited and Fisher Hoffman PKF (Jhb) Inc (`the independent
experts`), acceptable to the JSE, that the terms of the proposed transaction
with the related party are fair and reasonable to the shareholders of EOH. The
fair and reasonable opinion statement will be available for inspection at the
registered office of EOH for a period of 28 days from the date of this
announcement.
Johannesburg
3 September 2004
Sponsor and joint independent expert
Merchant Sponsors (Proprietary) Limited
Joint independent expert
Fisher Hoffman PKF (Jhb) Inc
Date: 03/09/2004 11:45:22 AM Produced by the JSE SENS Department
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