| Thu 2 Dec 2004, 17:45 | | Terms Announcement In Respect Of The Disposal |
|
AVI - Terms Announcement In Respect Of The Disposal Of Vector Logistics
AVI LIMITED
(Incorporated in the Republic of South Africa)
(`AVI` or `the Group`)
(Registration number 1944/017201/06)
Share code: AVI
ISIN: ZAE000049433
TERMS ANNOUNCEMENT IN RESPECT OF THE DISPOSAL OF VECTOR LOGISTICS (PROPRIETARY)
LIMITED
1. INTRODUCTION AND RATIONALE
Further to the announcement by AVI dated 12 October 2004 regarding the
restructuring of AVI to focus upon branded consumer products and services,
Standard Bank is authorised to announce that AVI has concluded an agreement
(`the sale agreement`) to dispose of all the shares owned by the Group in Vector
Logistics (Proprietary) Limited (`Vector`) to Rainbow Farms (Proprietary)
Limited (`Rainbow`), a subsidiary of Rainbow Chicken Limited (`the disposal`).
The disposal is in line with the Group`s objectives and, importantly, aligns
Vector with a shareholder well positioned to optimise its operating competencies
and ambitions.
2. SALIENT TERMS OF THE DISPOSAL
2.1 Consideration
The total consideration for the disposal, payable by Rainbow to AVI in cash, is
R454.9 million.
In addition, Vector distributed cash of R223 million to the Group by way of a
capital reduction and dividends subsequent to the financial year end (`the
Vector cash distributions`).
The total proceeds of the disposal and the Vector cash distributions of R677.9
million will be used to fund the purchase by AVI of the 19.3% equity interest in
Consol Limited held by Owens-Illinois, Inc., as announced on 12 October 2004,
and for AVI`s general corporate purposes.
2.2 Implementation and effective date
The implementation date of the Vector disposal is 2 December 2004. The effective
date of the Vector disposal in terms of the sale agreement is 1 July 2004.
2.3 Warranties
AVI has provided Rainbow with certain warranties that are usual in such
transactions.
3. FINANCIAL EFFECTS OF THE DISPOSAL
The table below sets out the pro forma financial effects of the disposal on the
net asset value (`NAV`) per AVI ordinary share (`share`), tangible net asset
value (`TNAV`) per share, headline earnings per share (`HEPS`) and earnings per
share (`EPS`), based on the Group`s audited results for the year ended 30 June
2004. These financial effects have been prepared for illustrative purposes only,
to provide information about the financial position and results of AVI assuming
that the disposal had been implemented on 30 June 2004 and 1 July 2003,
respectively. Because of its nature, the pro forma financial information may
not give a fair reflection of AVI`s financial position and results of operations
subsequent to the disposal.
Pro forma
Before the after the Percentage
disposal disposal change
(cents) (cents)
NAV per share 1 007.4 (1) 1 117.7 (2) 10.9
TNAV per share 942.4 (1) 1 052.7 (2) 11.7
HEPS 186.2 (3) 180.5 (4) -3.1
EPS 179.5 (3) 281.9 (4) 57.0
Notes:
(1) The NAV and TNAV per share, before the disposal, have been extracted from
AVI`s audited financial statements for the year ended 30 June 2004 and
calculated based on 309 981 206 shares in issue at 30 June 2004.
(2) The pro forma NAV and TNAV per share, after the disposal, have been
calculated based on 309 981 206 shares in issue at 30 June 2004, assuming that
the disposal was implemented on 30 June 2004.
(3) The HEPS and EPS, before the disposal, have been extracted from AVI`s
audited financial statements for the year ended 30 June 2004 and have been
calculated based on a weighted average of 315 809 761 shares in issue.
(4) The pro forma HEPS and EPS, after the disposal, have been calculated based
on a weighted average of 315 809 761 shares in issue, assuming that the disposal
was implemented on 1 July 2003 and that the cash proceeds from the disposal were
invested at a pre-tax rate of interest of 8.7% per annum.
Chislehurston
Sandton
3 December 2004
Investment bank and sponsor to AVI
Standard Bank
Enquiries:
AVI
Angus Band, Group Managing Director
Tel: +27 11 779 2703
Cell: + 27 82 990 4404
Robert Katzen, Group Financial Director
Tel: +27 11 779 2704
Cell: + 27 82 443 5922
Sam Denoon-Stevens, Investor Relations Officer
Tel: +27 11 779 2721
Cell: + 27 83 450 7654
