| Thu 21 Oct 2004, 10:42 | | Update To Shareholders |
|
Putco Limited - Update To Shareholders Regarding Firm Intention To Make An Offer
and cautionary announcement
PUTCO LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1945/018672/06)
Share code: PTC ISIN: ZAE000005716
(`Putco` or `the company`)
UPDATE TO SHAREHOLDERS REGARDING FIRM INTENTION TO MAKE AN OFFER AND CAUTIONARY
ANNOUNCEMENT
Intention by Hosken Consolidated Investments Limited to offer to purchase all or
a lesser number of the issued ordinary shares in the share capital of Putco via
a Scheme of Arrangement in terms of Section 311 of the Companies Act 61 of 1973
1. BACKGROUND
Further to the cautionary announcement dated 12 October 2004, shareholders are
advised that the Board of the company is in receipt of a revised letter, dated
13 October 2004, regarding a firm intention by Hosken Consolidated Investments
Limited (`HCI`) to offer to purchase (`the Offer`) all or a lesser number of the
issued ordinary shares in the share capital of Putco via a Scheme of Arrangement
in terms of Section 311 of the Companies Act 61 of 1973 (`the Scheme`).
2. THE OFFER
If the Scheme is implemented, Putco shareholders will be obliged to sell to HCI
(or its wholly-owned subsidiary), 38% of all the Putco shares held by them (ex
the 30 cent Putco dividend) for an amount of 550 cents (five hundred and fifty
cents) per Putco share whilst the remaining balance of each Putco shareholder`s
shares will be purchased by HCI, if offered for sale by a Putco shareholder (ex
the 30 cent Putco dividend), for an amount of 750 (seven hundred and fifty
cents) per Putco share. As stipulated below, the entire Offer is subject to the
acquisition by HCI of not less than 51% of Putco`s issued ordinary share
capital.
Should Putco shareholders accept the Offer in relation to their entire
shareholding in Putco, HCI will effectively be paying Putco shareholders 674
cents (six hundred and seventy four cents) per Putco share (ex the 30 cent Putco
dividend). The Putco Board has received appropriate independent confirmation as
to the ability of HCI to implement the Offer.
Payment of the purchase price payable in terms of 2.1 above will be made by HCI
within 5 days of the date that the Scheme is duly sanctioned by the relevant
High Court, subject to the fulfilment of all conditions precedent as outlined in
paragraph 3 below.
3. CONDITIONS PRECEDENT
The offer is subject to the fulfilment or waiver (by HCI in its discretion -
excluding those which relate to regulatory compliance) of the following
conditions precedent:
3.1 HCI, as the Offeror, (and its advisors) conducting a due diligence
investigation on all the assets, liabilities, rights, obligations and
affairs of Putco (`the Putco information`) and informing the Putco Board in
writing by not later than 21 business days following the date that access
to the Putco Information is given to HCI that it is satisfied with the
outcome thereof (`the Satisfaction Notice`). HCI will be obliged to give
the Satisfaction Notice if the due diligence investigation reveals that the
financial position and affairs of Putco are no less favourable than that
shown in the publication of the financial results of Putco for the
financial year ended 30 June 2004;
3.2 Signature by HCI and Putco by not later than 21 business days following the
date of the Satisfaction Notice, of relevant documentation pertaining to
the Scheme;
3.3 Putco furnishing to HCI a written irrevocable undertaking that it will not
without the consent of HCI, incur any obligation to make any payment to its
shareholders, or enter into and/or implement any transaction for the
acquisition or disposal of any assets or which involves financial
obligation on the part of Putco to the sum total value of more than R5
million;
3.4 The acceptance of the Offer by Putco shareholders in relation to not less
than 51% of all the Putco shares (the intention being that HCI shall
acquire under the Scheme, not less than 51% of all Putco shares);
3.5 Obtaining all requisite approvals from all statutory and regulatory bodies
having jurisdiction over the Offer, including but not limited to the
relevant Transport Authorities, Competition Authorities, the Securities
Regulation Panel, the JSE Securities Exchange South Africa and the South
African Reserve Bank; and
3.6 The sanctioning of the Scheme by the relevant High Court and the Scheme
becoming final and binding in accordance with its provisions.
4. SECURITIES REGULATION PANEL
The Board is of the opinion that the Offer is defective, does not comply with
the Securities Regulation Code on Take-Overs and Mergers (`Code`) and is
incapable of implementation in the form in which it is proposed. The Board and
its professional advisers have accordingly consulted the Securities Regulation
Panel (`SRP`) regarding the Offer. The SRP has obtained independent legal
advice confirming that the Offer is not capable of implementation without the
SRP granting a general exemption or dispensation in terms of Rule 34 of the
Code. The SRP has advised Putco that it will not grant such a dispensation.
5. FURTHER DEVELOPMENTS AND CAUTIONARY ANNOUNCEMENT
Putco`s shareholders will be informed of material developments in relation to
the Offer if and when these occur. As a result of the above, and the fact that
the company has received indications of interest from other potential parties
(which if concluded may have a material affect on the price of the company`s
securities) shareholders are again advised to exercise caution when dealing in
the Company`s shares until a further announcement is made.
Johannesburg
22 October 2004
Sponsor and corporate advisor
(Ernst & Young Sponsors (Pty) Ltd Logo)
(Registration number 2000/031843/07)l
Attorneys to Putco
Werksmans Incorporated
