| Mon 6 Dec 2004, 16:36 | | Restructure of Tiwheel"s manufacturing businesses |
|
Tiwheel - Restructure of Tiwheel`s manufacturing businesses and changes to the
board of directors of the company
TIGER WHEELS LIMITED
(INCORPORATED IN THE REPUBLIC OF SOUTH AFRICA)
(REGISTRATION NUMBER 1970/011662/07)
(`TIWHEEL`, `THE GROUP` OR `THE COMPANY`)
SHARE CODE: TIW ISIN NUMBER: ZAE000007407
RESTRUCTURE OF TIWHEEL`S MANUFACTURING BUSINESSES AND CHANGES TO THE BOARD OF
DIRECTORS OF THE COMPANY (`THE BOARD`)
1. Restructure
Further to the announcements published by Tiwheel on 2 September 2004 and 22
September 2004 shareholders are advised that an agreement on the restructure of
the ownership of the manufacturing businesses in the group has been concluded.
TiWheel currently owns 100% of its South African aluminium wheel manufacturing
business, TSW Manufacturing (Pty) Ltd (`TSWM`), and 74% of its international
aluminium wheel manufacturing business, ATS Beteiligungs GmbH (`ATS`).
With effect from 1 July 2004, ATS will acquire 100% of TSWM (`the TSWM
transaction`), thereby creating a uniform ownership and management structure for
all of the group`s global wheel manufacturing operations, which the board
believes will be beneficial for customers and the business. As a result,
conflicts of interest will be reduced, efficiencies enhanced and resources
optimised. Tiwheel will accordingly hold an effective 74% of TSWM via ATS. The
sale is at a small discount to tangible net asset value, resulting in an
immaterial dilution in net asset value per share and headline earnings per share
(without taking the estimated benefits into account). By 30 June 2005 Tiwheel
will receive Euro9,543,089 after a capital reduction in TSWM of R122,790,343.
The size of the transaction which is the subject of this announcement, falls
below the minimum threshold of a `category 3 transaction` as defined by the JSE
Securities Exchange South Africa and this information is published voluntarily
for information purposes only.
The TSWM transaction is subject to regulatory approval by the South African
Reserve Bank and the Competition Commission, as well as approval by the
financiers of TSWM and the ATS Group.
The table below has been prepared by the board of directors and sets out the pro
forma financial effects of the TSWM transaction based on audited historical
financial information for the year ended 30 June 2004. These pro forma financial
effects have been prepared for illustrative purposes only, to provide
information about how the TSWM transaction might have affected the financial
information presented and, because of their nature, may not give a true
reflection:-
Before (cents) After (cents) Percentage
change
(%)
Attributable earnings 236.9 218.5 -8
per share1 & 2
Headline earnings per 239.9 239.1 -0.4
share1
Tangible net asset 1134.0 1117.0 -1.6
value per share1
Weighted average number 59,786,653 59,786,653
of shares in issue
Assumptions:
1. Assuming the TSWM transaction was concluded on 1 July 2003.
2 The purchase consideration for TSWM is at a discount to NAV. An amount of
R10 514 224 (at the assumed exchange rate of R7.92/Euro), which represents
the 26% minority shareholders` share of the discount to NAV, that would
have been charged to Tiwheel`s attributable earnings, but not its headline
earnings.
The amount referred to in Assumption 2. above, i.e. R10 514 224, will be charged
to Tiwheel`s attributable earnings in the current financial year. The benefits
of enhanced efficiencies, better optimisation of resources and reduced conflicts
of interest, have not been quantified.
2. Changes to the board
The above announcement finally achieves the separation of the international
wheel manufacturing operations and the South African trading interests.
Therefore, with effect from 1 December 2004:
- Eddie Keizan has been appointed the Executive Chairman of Tiwheel and
consequently has relinquished his position as Group Chief Executive
Officer. These functions will in future be performed by the executives in
charge of the two businesses, namely; -
- Siegfried F. Teichert, who will continue as Chief Executive Officer of the
ATS group, which will house all the group`s manufacturing businesses,
including TSWM, and,
- Keith Rivers, who will continue as Chief Executive Officer of the South
African trading businesses, Tiger Wheel & Tyre (Pty) Ltd (Retail) and
Yokohama Southern African (Pty) Ltd (Wholesale);
- Phillip Vallet has been appointed as a Non-Executive Director and Deputy
Chairman;
- Martin Glatt, has relinquished the position of Chairman and will continue
as a Non-Executive Director.
The positions of Josh Loots as Group Financial Director and Rainer Hagemann and
Mike Groves as Independent Non-executive Directors remain unaffected.
Midrand
5 December 2004
Sponsor
SASFIN CORPORATE FINANCE
A DIVISION OF SASFIN BANK LIMITED
