| Wed 3 Nov 2004, 12:42 | | Abridged Pre-Listing Statement Preference Share |
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Sasfin Holdings - Abridged Pre-Listing Statement Preference Shares
SASFIN HOLDINGS LIMITED
Incorporated in the Republic of South Africa
Registration number 1987/002097/06
(`Sasfin Holdings` or `the company`)
Share code: SFN ISIN ZAE000006565
Share code: SFNP ISIN ZAE000060273
ABRIDGED PRE-LISTING STATEMENT
1. INTRODUCTION
In order to raise cost effective permanent share capital as part of a general
capital management programme and to enable the group to fund strategic
initiatives, Sasfin Holdings has, prior to the issue of this abridged pre-
listing statement, placed 1 000 000 non-redeemable non-cumulative non-
participating preference shares in Sasfin Holdings with a par value of R0,01
each (`preference shares`) at a subscription price of R100 per preference share
(`the private placement`), thereby raising R100 000 000. This will enable Sasfin
Bank Limited (`Sasfin Bank`), a major operating subsidiary of the company, to
increase its qualifying capital by an amount of up to R100 000 000.
2. INFORMATION RELATING TO SASFIN HOLDINGS
2.1 Incorporation
Sasfin Holdings (together with its subsidiaries referred to as `the group`) is a
bank controlling company which was incorporated as a public company in South
Africa on 15 May 1987 under the name Adagio Investments Limited. On 5 October
1987 the name was changed to Sasfin Holdings Limited and it listed in the
`Development Capital Market` sector of the JSE Securities Exchange South Africa
(`JSE`) on 11 November 1987. In 1988 the listing of the company was transferred
to the `Financials: Speciality and Other Finance` sector of the JSE.
2.2 Background
The business of the main subsidiary of the company, now known as Sasfin
Bank, started out in 1951 as a textiles business, which was transformed into a
trade and equipment finance house in the 1970`s and pioneered securitisation in
South Africa in 1991. In 1998 Sasfin Holdings acquired a 60% interest in
Premier Freight, a freight forwarding and customs clearing company and an
interest in the private equity company NIB-MDM Private Equity Fund Managers
(Proprietary) Limited. In 1999 Sasfin Bank obtained a banking licence and in
2000 the company acquired its private client stockbroking and portfolio
management business, Sasfin Frankel Pollak Securities, its corporate finance
division, Sasfin Corporate Finance, and the financial advisory services
businesses which are housed in Sasfin Investment and Asset Managers (Pty) Ltd.
Based on its 1987 listing price of 60 cents per share and closing share
price at 30 June 2004 of 1070 cents and dividends paid during the period, Sasfin
Holdings has achieved an average annual return on equity of 26%, a compound
growth rate in earnings per share of 24% and a compound annual return to
shareholders of 27%.
2.3 Group structure
SENS: For a diagrammatic explanation of the structure under which Sasfin
Holdings operates please refer to the press announcement published on 4 November
2004.
2.4 Nature of the business
The group offers a wide range of complementary banking, financial and
related services to its target market of entrepreneurial commercial, corporate
and private clients. The group`s major businesses or divisions are described in
more detail below.
2.4.1 Commercial Finance Division
The Commercial Finance Division consists of the three core lending units of
Sasfin Bank, namely Trade Finance, Debtor Finance and Equipment Finance and
focuses on servicing entrepreneurial companies by delivering tailored financial
products and lending facilities aimed at financing working capital. This
division specialises in the small to medium business sector and aims to
establish and grow personal relationships with entrepreneurs.
2.4.1.1 Trade Finance Unit
The Trade Finance Unit provides its clients with finance on a short term basis
to assist them in financing their local or imported purchases. Services
include letter of credit facilities, confirmation of orders, payment to
suppliers, local or foreign currency funding and forward exchange contracts.
2.4.1.2 Debtor Finance Unit
The Debtor Finance Unit offers Disclosed Debtor Finance and Invoice
Discounting and enables its clients to turn credit sales into cash, to access
additional working capital to fund growth and to negotiate or access better
discounts from its suppliers. It also offers access to credit information and
off balance sheet funding. Facilities are tailored to grow with the turnover of
the business of the client.
2.4.1.3 Equipment Finance Unit
The Equipment Finance Unit specialises in office automation equipment by
providing a unique rental facility to equipment users, which is supported by
high levels of expertise and understanding of the product and aided by complete
professionalism. This unit also provides financial leasing and instalment
finance for plant and machinery as well as operating rentals for vehicles.
Sasfin Bank acquired a 33,6% interest in InnoVent Rental and Asset Management
Solutions (Proprietary) Limited, a black-owned company focusing on the rental of
technology assets to the medium to large corporate sector, which complements the
equipment rental finance unit as it caters for the growing need for residual-
based rentals for the procurement of technology in the corporate market.
2.4.2 Corporate Finance Division
This division provides corporate advisory services to listed and unlisted
companies on mergers, acquisitions and disposals, corporate strategy and
restructurings, management buy-outs and buy-ins, capital raising and reduction,
listings and delistings, JSE sponsorship and designated advisory, empowerment
and securitisation advisory services.
The division acts as sponsor to approximately 10% of all companies listed on the
JSE and is an approved designated advisor for companies listed or to be listed
on AltX, the alternative exchange of the JSE.
2.4.3 Investment and Asset Management Division
This division consists of the Stockbroking, Asset and Portfolio Management, Life
Assurance and Financial Planning, Healthcare Consulting, Employee Benefits
Administration and Consulting and Short Term Insurance units.
2.4.3.1 Sasfin Frankel Pollak Securities (Proprietary) Limited (`Sasfin
Frankel Pollak Securities`) - Stockbroking, Portfolio and Asset Management Unit
Sasfin Frankel Pollak Securities has actively participated in the South African
stockbroking industry for more than 115 years and currently has in excess of R10
billion under administration. The company is committed to GlobalWealthCreation,
a philosophy centred on the delivery of focused, innovative and tailored
investment solutions to private clients. This involves a process of careful
analysis and close interaction with its clients, the definition of individual
needs and objectives for investment strategies and the utilisation of the
appropriate products and solutions in order to maximise benefit and minimise
risk.
Products and services include a range of stockbroking, asset management and
bespoke equities investment solutions, locally and abroad, underpinned by a
national branch network, a highly rated back office and sophisticated systems.
It has an exclusive joint venture with Edmond de Rothschild Asset Management,
Paris in the Sasfin International Fund, a Luxembourg based and locally approved
international investment fund.
2.4.3.2 Sasfin Investment and Asset Managers (Proprietary) Limited (`Sasfin
Investment and Asset Managers`) - Financial Planning
Sasfin Investment and Asset Managers provides its clients with a one-stop
financial planning solution. It caters for private, corporate and
entrepreneurial clients and offers professional, competent and experienced, risk
profiled advisory and investment solutions in the fields of life insurance and
financial planning, employee benefits, healthcare, and insurance.
2.4.3.2.1 Life Assurance and Financial Planning Unit
This unit offers estate, tax, investment and retirement planning, pension and
provident fund consulting and administration, life assurance and specialised
insurance, such as disability and dreaded disease cover.
2.4.3.2.2 Healthcare Consulting Unit
This unit offers tailored healthcare solutions to entrepreneurial and corporate
clients and is a medical aid broker.
2.4.3.2.3 Employee Benefits Administration and Consulting Unit
The Employee Benefits Administration and Consulting Unit was disposed of to a
company in which Sasfin Investment and Asset Managers will retain a 30%
interest, a 10% interest will be obtained by a Black Economic Empowerment
partner and 60% will be owned by Pioneer Financial Planning Services
(Proprietary) Limited, a company with which Sasfin Investment and Asset Managers
has a close working relationship.
2.4.3.2.4 Short Term Insurance Unit
This unit contains the short-term insurance broking business, Sasfin Insurance
Brokers (Proprietary) Limited, a wholly owned subsidiary of Sasfin Investment
and Asset Managers, which has an outsource service provider and covers the short
term insurance requirements of the group and its clients.
2.4.4 Treasury and Securitisation Division
Sasfin Bank is to a large extent funded by securitisation and deposits, which
are managed by its Treasury and Securitisation Division. The Treasury Division
is the funding arm of Sasfin Bank and offers a range of domestic money market
products.
2.4.5 Freight Services Division
Premier Freight (Proprietary) Limited (`Premier Freight`), in which Sasfin
Holdings holds a 60% interest, is one of South Africa`s leading independent
freight forwarding and customs clearing concerns. The company specialises in
providing customs clearing and allied services and handles import, export, air
and sea transactions on a door-to-door basis. It has a client base of
approximately 500 regular importers and exporters. Premier Freight in
partnership with the Hecny Group of Hong Kong owns Hecny Transportation SA
(Proprietary) Limited, an international freight forwarding business which has
access to 160 offices on a global basis.
The association between the Sasfin Trade Finance Unit and Premier Freight
facilitates the provision of a total financial and freight management programme
to clients who are involved in foreign trade.
2.4.6 Private Equity Division
Sasfin Bank has a 7,3% interest in NIB - MDM Private Equity Fund Managers
(Proprietary) Limited which manages the NIB-MDM Private Equity Fund 1, a joint
venture with Nedbank Corporate Private Equity and a consortium of high net worth
individuals. The fund, in which Sasfin Bank has a 13,5% interest is primarily
invested in technology, telecommunications, leisure, education and distribution
companies. NIB-MDM Private Equity Fund Managers (Proprietary) Limited is owned
by the fund`s shareholders, management and a Black Economic Empowerment company
headed by Dr Mathews Phosa.
2.5 Prospects
With an excellent team, a wide and balanced suite of products high capital
adequacy and a strong and growing entrepreneurial client base the group is well
positioned to be the banker of choice for its target market. While an increase
in interest rates would impair profitability, the consensus view is that
interest rates will remain relatively steady for the foreseeable future. Under
this scenario and given the cost saving measures that have been achieved by the
group earnings growth is likely to return to normal levels in the 2005 financial
year.
INFORMATION RELATING TO THE DIRECTORS OF SASFIN HOLDINGS
3.1 Directors
The full names, ages, nationalities (if not South African), addresses and
profiles of the directors as at the last practicable date are set out below.
3.1.1 Charles Norman Axten Independent non-executive director
Appointed: 1 November 1999
Age: 68
Business address: Sasfin Place, 13 - 15 Scott Street, Waverley, 2090
Qualifications: CAIB/SA - Fellow of Institute of Bankers, EDP
Wits), AMP (Harvard University)
Directorships: Sasfin Holdings, Sasfin Bank, Council Member of
Medical University of South Africa, Chairman of
Medunsa Trust, Member of National Lottery Board,
Governor of Bishop Bavin School, St Georges.
3.1.2 Edward Thomas Bye Blight Independent non-executive director
Appointed: 16 January 2001
Age: 64
Business address: Sasfin Place, 13 - 15 Scott Street, Waverley, 2090
Directorships: Sasfin Holdings, Sasfin Bank.
3.1.3 Martin Barry Glatt Non-executive chairman
Appointed: 26 August 1987
Age: 58
Business address: Sasfin Place, 13 - 15 Scott Street, Waverley, 2090
Qualifications: B.Comm, MBL
Directorships: Sasfin Holdings, Sasfin Bank, Tiger Wheels Limited
(Chairman), MDM Growth Investments Limited, NIB-
MDM Private Equity Fund Managers (Pty) Ltd, NIB-
MDM Private Equity Fund 1 (Pty) Ltd, L Wechsler &
Co (Pty) Ltd, SA Cut Glass (Pty) Ltd, N&Z
Instrumentation & Control (Pty) Ltd, Business
Against Crime - South Africa.
3.1.4 Alan Wilfred Greenstein Managing director
Appointed: 31 July 2001
Age: 44
Business address: Sasfin Place, 13 - 15 Scott Street, Waverley, 2090
Qualifications: BA LLB (Wits), HDip Company Law (Wits), HDipTax
(RAU) (cum laude), Advanced Diploma in Banking
(RAU) (cum laude).
Directorships: Sasfin Holdings, Sasfin Bank, Sasfin Frankel
Pollak Securities, Sasfin Insurance Brokers,
Sasfin Investment and Asset Managers, Innovent
Rental and Asset Management Solutions.
3.1.5 Dennis Paizes Independent non-executive director
Appointed: 12 January 1998
Age: 69
Business address: Sasfin Place, 13 - 15 Scott Street, Waverley, 2090
Qualifications: B.Comm (Wits)
Directorships: Sasfin Holdings, Sasfin Bank, Group Five Limited.
3.1.6 Roland David Ezra
Benjamin Sassoon
(British) Chief executive officer
Appointed: 21 August 1987
Age: 59
Business address: Sasfin Place, 13 - 15 Scott Street, Waverley, 2090
Qualifications: FCIS
Directorships: Sasfin Holdings, Sasfin Bank, Sasfin Frankel
Pollak Securities, Sasfin Investment and Asset
Managers, Sasfin Insurance Brokers, Equipment
Rentals Securitisation No. 1 (Pty) Ltd, MDM Growth
Investments Limited, Premier Freight, Quorum
Leasing Services (Pty) Ltd, Sasfin Asia Limited of
Hong Kong, Sasfin Properties (Pty) Ltd and Sasfin
Properties II (Pty) Ltd, Sasfin Rentals (Pty) Ltd,
Innovent Rental and Asset Management Solutions
(Pty) Ltd.
3.1.7 Martinus Luther Smith Independent non-executive director
Appointed: 1 December 1999
Age: 64
Business address: Sasfin Place, 13 - 15 Scott Street, Waverley, 2090
Qualifications: B. Comm FFA AEP (Unisa)
Directorships: Sasfin Holdings, Sasfin Bank, Metropolitan
Holdings Limited, Metropolitan Life (Namibia)
(Pty) Ltd (chairman), Agathon (Pty) Ltd.
SHARE CAPITAL OF SASFIN HOLDINGS
4.1 Authorised and issued share capital
The authorised and issued share capital of Sasfin Holdings, before and after the
private placement is set out below.
Before the private placement
R`000
Authorised share capital
40 000 000 ordinary shares of R0,01 each 400
5 000 000 non-redeemable, non-cumulative,
non-participating preference shares of 50
R0,01 each
Total authorised share capital 450
Issued share capital
25 911 791 ordinary shares of R0,01 each 259
Total issued share capital 259
Share premium
On 25 911 791 ordinary shares of R0,01 16 718
each
After the private placement
R`000
Authorised share capital
40 000 000 ordinary shares of R0,01 each 400
5 000 000 non-redeemable, non-cumulative,
non-participating preference shares of 50
R0,01 each
Total authorised share capital 450
Issued share capital
25 911 791 ordinary shares of R0,01 each 259
1 000 000 non-redeemable, non-cumulative,
non-participating preference shares of 10
R0,01 each
Total issued share capital 269
Share premium
On 25 911 791 ordinary shares of R0,01 16 718
each
On 1 000 000 non-redeemable, non- 99 990
cumulative, non-participating preference
shares of R0,01 each
Total share premium 116 708
The company`s authorised share capital was increased by R50 000 (fifty thousand
Rand) by the creation of 5 000 000 (five million) non-redeemable, non-
cumulative, non-participating preference shares of a nominal value of R0,01 each
by special resolution approved by the requisite number of shareholders at the
annual general meeting of Sasfin Holdings held on Monday, 25 October 2004.
Also at the abovementioned annual general meeting, shareholders approved the
ordinary resolution placing the preference shares under the control of the
directors of the company, who were authorised to allot and issue the preference
shares at their discretion until the next annual general meeting of the company.
5. DETAILS OF THE PRIVATE PLACEMENT AND THE LISTING
5.1 Particulars of the private placement
Subscription price per preference share R100
Minimum Rand value of subscription per
applicant acting as principal R100 000
Number of preference shares to be issued 1 000 000
Amount raised in terms of the private R100 000 000
placement
Listing date (09:00) Wednesday, 17
November 2004
Prior to the issue of this abridged pre-listing statement, the preference shares
were placed with selected investors at a subscription price of R100 per
preference share by obtaining irrevocable commitments from these investors to
subscribe for all 1 000 000 preference shares, thereby raising R100 000 000.
5.2 The listing
The JSE has granted Sasfin Holdings a listing of 1 000 000 preference shares in
the Specialist Securities - `Preference Shares` sector under the abbreviated
name `Sasfin PREF` with the share code SFNP and ISIN code ZAE000060273 with
effect from Wednesday, 17 November 2004. The listing was subject to the
condition that Sasfin Holdings meets the requirements of the JSE and obtains the
requisite spread of preference shareholders, being a minimum of 50 (fifty)
public preference shareholders, excluding employees of Sasfin Holdings and their
associates. This condition has been met.
6. THE TERMS OF THE PREFERENCE SHARES
The preference shares are non-redeemable, non-cumulative and non-participating.
Preference dividends are payable semi annually at least 7(seven) business days
prior to the date on which Sasfin Holdings pays its ordinary dividend, if any,
but in any event the preference dividend, if declared, shall be payable not
later than 120 (one hundred and twenty) business days after 30 June and 31
December, respectively.
6.1 Voting rights
The preference shares are non-voting, save for those circumstances prescribed
under Section 194 of the Act. While preference shareholders are entitled to
receive notice of any meeting of the company and to be present thereat, they
will only be entitled to vote during those periods when the preference dividend
(if declared), or any part thereof, remain in arrears and unpaid after six
months from the relevant preference share dividend payment date or when a
resolution of Sasfin Holdings is proposed which directly affects the rights
attached to the preference shares or the interests of the preference
shareholders, which shall include a resolution for the winding up Sasfin
Holdings or for the reduction of its capital.
6.2 Entitlements to dividends
Preference shareholders will be entitled to receive dividends out of the profits
of Sasfin Holdings, that it determines to distribute, in priority to any payment
of dividends to shareholders of any other class of share in the capital of the
company, not ranking prior to or pari passu with the preference shares. The
preference dividend shall be calculated by multiplying the subscription price of
the preference shares, being R100, by the preference dividend rate, being 75% of
the prime overdraft lending rate of Nedbank Limited, on the preference dividend
accrual date, on a daily basis, in arrear, but never compounded. The period of
the preference share dividend will be from the date following the previous
preference dividend accrual date until and including the preference dividend
accrual date immediately following. The preference dividend accrual dates shall
be 30 June and 31 December of each year. The first dividend payment, in respect
of the first tranche of preference shares issued, shall be calculated from the
issue date up to and including 31 December 2004.
7. Documentation
Copies of the pre-listing statement will be posted to the ordinary
shareholders and preference shareholders of Sasfin Holdings on Monday, 15
November 2004 and can also be obtained from the registered offices of the
company at Sasfin Place, 13 - 15 Scott Street, Waverley, Johannesburg.
Alternatively, copies of the pre-listing statement can be viewed and/or printed
from the website of Sasfin Holdings, www.sasfin.com from Monday, 15 November
2004.
Corporate Advisor and Joint Sponsor Lead Sponsor
SASFIN CORPORATE FINANCE KPMG SERVICES (PTY) LTD
A DIVISION OF SASFIN BANK LIMITED
Corporate law advisors and Consultants
Edward Nathan & Friedland (Pty) Ltd
Placement agents
Sasfin Frankel Pollak Securities (Pty) Ltd
Date: 03/11/2004 12:00:18 PM
Produced by the JSE SENS Department
