| Fri 17 Dec 2004, 15:22 | | Announcement To New Africa Investments Limited |
|
NAIL - Announcement To New Africa Investments Limited Shareholders And
Cautionary Announcement
NEW AFRICA INVESTMENTS LIMITED(Incorporated in the Republic of South Africa)
(Registration number 1993/002467/06)
Share code: NAI and NAN
ISIN: ZAE000033338 and ZAE0000033346(`NAIL`)
ANNOUNCEMENT TO NEW AFRICA INVESTMENTS LIMITED SHAREHOLDERS AND CAUTIONARY
ANNOUNCEMENT
1. INTRODUCTION NAIL hereby announces that it has received a firm intention to make an
offer from Primedia Limited (`Primedia`) to acquire all of the issued
ordinary shares (`NAIL ordinary shares`) and all of the issued `N`
ordinary shares (`NAIL `N` ordinary shares`) in NAIL as one indivisible transaction (collectively `NAIL shares` or `NAIL share`) as outlined in
this announcement (`the offer`).
2. TERMS OF THE OFFER
The terms of the offer as received by NAIL are as follows:2.1 Offer price
The offer price is R0.356 per NAIL share in cash excluding the
distributions to be made to NAIL shareholders detailed in 3.5 below (`the
offer price`). At such stage it is envisaged that NAIL will have no liabilities and NAIL`s assets will consist of the following:
2.1.1 24.9% of the entire issued share capital of Kaya FM (Pty) Limited
(`Kaya`);
2.1.2 the various loans made by NAIL to P4 Radio Cape Town (Pty) Limited and P4 Radio Durban (Pty) Limited (`the P4 loans`); and
2.1.3 the various claims and/or preference shares in Motsomai (Pty)
Limited and Makana SPV (Pty) Limited (`the SPV interests`) which
hold 24.9% in Kaya (`NAIL`s remaining assets`).
The effective date of the transaction will be the date the offer closes
(`the effective date`).
2.2 Offer price adjustments In the event that NAIL has entered into a binding agreement for the sale or
repayment of the SPV interests, and/or the P4 loans the offer price will be
reduced as follows:
2.2.1 by R0.146 per NAIL share if the SPV interests have been sold or repaid or on a pro rata basis in the event of a partial sale or
partial redemption; and
2.2.2 by R0.059 per NAIL share if the P4 loans have been sold or repaid
or on a pro rata basis in the event of a partial sale or partial redemption.
In the event that NAIL does not dispose of the assets referred to in 2.2.1
and 2.2.2 above the offer price will increase by 0.228 cents per month or
pro rata for part of a month from 1 April 2005 (`the offer price increment`). In the event either of the SPV interests or the P4 loans have
been sold by NAIL then the offer price increment will reduce
proportionately.
2.3 General offer terms The offer will be structured by way of Section 440K offer (`section 440K
offer`).
The offer envisages that the NAIL shares will be acquired by Primedia fully
paid, without any right of set-off, and free from all liens, counterclaims, equities, mortgages, charges, encumbrances, rights of pre-emption and other
interests whatsoever and together with all rights now or hereafter
attaching thereto, including all voting rights and the right to receive and
retain all dividends, other distributions (excluding the distributions detailed in 3.5 below), benefits or rights hereafter declared , made or
paid, irrespective of the actual date of registration or transfer of the
NAIL shares into the name of Primedia.
2.4 Cash confirmation Primedia has confirmed to NAIL and to the Securities Regulation Panel (and
has provided NAIL and the Securities Regulation Panel with the written
confirmation as contemplated in Rule 2.3 of the Securities Regulation Code
on Takeovers and Mergers) that it has sufficient cash resources and / or facilities with which to meet its obligations to NAIL in relation to the
offer.
2.5 Distributions
The following distributions will be made to NAIL shareholders who accept the offer:
2.5.1 the net proceeds realised (after providing for capital gains tax
and secondary tax on companies) by NAIL on the disposal of its
entire interest (ordinary and preference shares) in Alisa Holdings (Pty) Limited (`Hertz`) which operates the Hertz
franchise in South Africa;
2.5.2 the distribution of NAIL`s remaining cash, including any cash
arising from 2.2.1 and 2.2.2 (after providing for capital gains tax and secondary tax on companies), after settling all its
outstanding liabilities including any costs incurred or awarded
against NAIL up to 14 December 2004 in relation to the litigation
regarding the P4 loans; and 2.5.3 any money received by NAIL relating to the recovery of the KFM
Radio (Pty) Limited (`KFM`) tax trademark or proceeds received
from Wild Coast Films (Pty) Limited (`Wild Coast Films`) (after
providing for capital gains tax, if any, and secondary tax on companies),
(`the distributions`).
Accordingly the NAIL shares will be acquired on the effective date ex the
distributions relating to the aforegoing. An appropriate mechanism will be put in place to pay NAIL shareholders who
accept the offer in the event that any of the distributions are made by
NAIL after the offer price has been settled.
2.6 Conditions precedent 2.6.1 The posting of the offer is subject to the specific condition
that NAIL disposes of its entire interest in Hertz. The
Securities Regulation Panel has indicated to NAIL that it will
require a fixed date for the fulfilment of this specific condition which is reasonable in the circumstances. NAIL and
Primedia will enter into discussions with the Securities
Regulation Panel in regard to this date.
2.6.2 The offer is subject to the fulfilment of the following condition precedent, namely to the extent required, the approval by and
compliance with such requirements as may be required by the
relevant regulatory authorities, including but not limited to the
JSE Securities Exchange South Africa (`JSE`), the Securities Regulation Panel, and the Competition Authorities.
3. PRIMEDIA`S ARRANGEMENTS AND SHAREHOLDING IN NAIL
Primedia has informed NAIL that at present there is no existing holding of
securities in NAIL: 3.1 which Primedia owns or over which it has control;
3.2 which is owned or controlled by any person acting in concert with
Primedia or in respect of which Primedia has received an irrevocable
commitment to accept the offer; 3.3 in respect of which Primedia holds an option to purchase; and
3.4 in respect of which any person acting in concert with Primedia holds
an option to purchase.
No arrangement exists between Primedia and NAIL in relation to any relevant securities.
4. SHAREHOLDER SUPPORT
Primedia has informed NAIL that NAIL shareholders holding more than 50% of
the NAIL ordinary shares and more than 50% of the NAIL `N` ordinary shares have indicated that they support and intend to accept the offer.
5. CAUTIONARY ANNOUNCEMENT
As previously announced, NAIL has embarked on a process to dispose of its
remaining assets and to return excess cash to its shareholders. NAIL will, in the new year, assess the offer and its impact on the aforegoing process
and will make an announcement in this regard then. In the interim,
pursuant to this announcement, NAIL shareholders are advised to exercise
caution when dealing in their NAIL shares until a further announcement is made.
Sandton
17 December 2004
Sponsor(Investec Bank Limited)
Corporate law advisers and consultants
(ENF)Date: 17/12/2004 01:00:04 PM Produced by the JSE SENS Department
