| Tue 21 Sep 2004, 17:58 | | FURTHER INVESTMENT BY ARCH EQUITY (PROPRIETARY) L |
|
PSG GROUP LIMITED - FURTHER INVESTMENT BY ARCH EQUITY (PROPRIETARY) LIMITED
(`Arch Equity`), PSG GROUP`S BEE PARTNER, IN PSG GROUP
PSG GROUP LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1970/008484/06)
Share code: PSG ISIN: ZAE000013017
(`PSG Group` or `the company`)
FURTHER INVESTMENT BY ARCH EQUITY (PROPRIETARY) LIMITED (`Arch Equity`), PSG
GROUP`S BEE PARTNER, IN PSG GROUP
1. Background
1.1 Arch Equity is a black company as defined in the Financial Sector Charter.
The directors of Arch Equity are Messrs D Lockey (CEO), PJ Mouton (executive
director) JF Mouton (non-executive), N Mtshotshisa (non-executive Chairman) and
J Moropa (non-executive).
1.2 Arch Equity has, over the last number of months acquired 19,7 million PSG
Group shares, resulting in Arch Equity holding 17,1% of PSG Group`s issued share
capital.
1.3 It is intended that Arch Equity will subscribe for so many further PSG
Group shares as will result in Arch Equity holding a 20% direct interest in PSG
Group.
2. Specific issue of PSG Group shares for cash to Arch Equity
2.1 Subject to PSG Group shareholder approval, PSG Group will issue to Arch
Equity 4 675 000 PSG Group ordinary shares (`the new PSG Group shares`) for
cash, at a subscription consideration of 314 cents per share, i.e. a total
consideration of R14 679 500 (`the issue for cash`).
2.2 The new PSG Group shares will represent 3,9% of PSG Group`s issued shares
after the issue for cash.
2.3 Arch Equity is a non-public shareholder in terms of the Listings
Requirements (`Listings Requirements`) of the JSE Securities Exchange South
Africa (`the JSE`).
2.4 The issue price of 314 cents per share represents the weighted average
traded price of 314 cents per share for the 30 trading days ended 20 August
2004, being the date the issue price was agreed by the directors of PSG Group
and Arch Equity.
2.5 In terms of the Listings Requirements, the approval of a 75% majority of
the votes cast by all shareholders present or represented by proxy at a general
meeting of PSG Group shareholders, excluding any parties and their associates
participating in the issue for cash, is required for the resolution to be
proposed at the general meeting to be effective. Arch Equity will thus be
excluded from voting their existing PSG Group shares at such general meeting.
2.6 Application will be made to the JSE for the listing of the new PSG Group
shares upon their issue.
3. Related party transaction
3.1 In terms of the Listings Requirements, Arch Equity is an `associate` of Mr
D Lockey by virtue of his substantial indirect shareholding in Arch Equity. In
addition, Messrs D Lockey and JF Mouton are both directors of Arch Equity and of
PSG Group. Consequently, the issue for cash is a `related party transaction` in
terms of the Listings Requirements.
3.2 Messrs Lockey and Mouton will be taken into account in determining a quorum
at the general meeting and they may vote the PSG Group shares owned and
controlled by them, but their votes will not be taken into account in
determining the results of the voting at the general meeting in relation to the
issue for cash.
3.3 PSG Group will appoint independent advisers to consider the terms of the
issue for cash, and to give an opinion on whether the terms of the issue for
cash is fair and reasonable to PSG Group shareholders.
4. Pro forma financial effects of the issue for cash
The table below sets out the unaudited pro forma financial effects of the
issue for cash on PSG Group. The unaudited pro forma financial effects have
been prepared for illustrative purposes only and because of their nature may not
give a fair reflection of PSG Group`s financial position nor the effect on
future earnings after the issue for cash.
The financial effects set out below are based on the audited financial
results of PSG Group for the year ended 29 February 2004 and the financial
position of PSG Group at that date and have been prepared assuming that:
for purposes of the earnings and headline earnings per share figures, the issue
for shares was effected on 1 March 2003; and
for purposes of the net asset value and net tangible asset value per share
figures, the issue for cash was effected on 29 February 2004.
Before the After the
issue for issue for Change
cash cash %
(cents) (cents)
Earnings per share 29,3 29,0(1) (1,0)
Headline earnings per 72,6 70,5(1) (2,9)
share
Net asset value per share 316 316 -
Net tangible asset value per 277 279 0,7
share
Number of shares at year
end (`000)
- in issue 105 000 109 675
- weighted average 111 700 116 375
Actual shares in issue(2) 115 000 119 675
Notes:
(1) Assuming interest earned on R13,9 million, being the gross proceeds of the
issue for cash of R14,7 million less the estimated transaction costs of R800
000, at an after-tax rate of 7%.
(2) Subsequent to year end PSG Group issued 10 million shares to Arch Equity
(`the previous issue`). The previous issue was the subject of a previous
announcement and subsequent circular to shareholders dated 7 April 2004. The
figures in the `Before the issue for cash` column above are based on the shares
in issue at year-end and the weighted average number of shares in issue for the
year ended 29 February 2004, i.e. before the previous issue.
5. Circular to PSG Group shareholders
A circular to PSG Group shareholders, containing full details of the issue
for cash and notice of a general meeting of PSG Group shareholders will, subject
to JSE approval, be sent to PSG Group shareholders in due course.
Stellenbosch
21 September 2004
Corporate adviser and joint
sponsor
PSG CAPITAL LIMITED
(Registration number
2002/017396/06)
Lead sponsor
PRICEWATERHOUSECOOPERS
CORPORATE FINANCE (PTY) LTD
(Registration number
1970/003711/07)
Date: 21/09/2004 05:52:21 PM Produced by the JSE SENS Department
