| Wed 29 Dec 2004, 13:34 | | All Joy - Issue of Shares for Cash |
|
All Joy - Issue of Shares for Cash
ALL JOY FOODS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1989/000100/06)
JSE Share code: ALJ ISIN: ZAE000017240
(`All Joy` or `the Company`)
Issue of Shares for Cash
1. INTRODUCTION
All Joy is pleased to announce that, further to the cautionary announcements
released on SENS on 6 September 2004 and 13 December 2004, shareholders are
advised that All Joy has successfully finalised an agreement with The National
Empowerment Fund Trust (`NEF`) on 29 December 2004 to advance Black Economic
Empowerment (`BEE`) by the subscription of shares for cash, thereby supporting
and strengthening its permanent capital base by R5 million. In total, 8,333,333
new All Joy ordinary shares of 1 cent par value each (`new All Joy shares`) are
to be issued at an issue price of 60 cents per share (`the issue`). All the new
All Joy shares have been placed with the NEF, a public shareholder, which
operates as a catalyst for BEE in South Africa. The issue is subject to the
approval of a 75% majority of the votes of all shareholders, present or
represented by proxy at a general meeting.
The issue represents 19,9% of the issued share capital of All Joy and will
increase All Joy`s issued share capital from 33,640,000 shares to 41,973,333
shares. The issue price represents a discount of 10% to the weighted average
traded price of All Joy shares on the JSE Securities Exchange South Africa
(`JSE`) for the 30-day period prior to the date on which the terms of the issue
were agreed. The new All Joy shares will rank pari passu with the existing
issued shares of All Joy.
Application will be made to the JSE for the listing of the new All Joy shares.
2. RATIONALE FOR THE ISSUE
It is imperative to All Joy to maintain a high BEE status and it has therefore
purposely partnered with the NEF, which places the Company in a strong
competitive position in the South African food industry.
The directors of All Joy have determined that, given the sustainability of the
increased profitability and potential acquisition opportunities available to All
Joy that it should be funded by an increase in permanent capital through the
issue of new shares so as to maintain the group`s interest bearing debt at
acceptable levels.
3. FINANCIAL EFFECTS
The pro forma financial effects of the issue of 8,333,333 new ordinary shares at
an issue price of 60 cents per share, as set out below, have been prepared for
illustrative purposes only and are based on the following assumptions:
- the headline earnings, earnings, net asset value and tangible net asset
value per share reflected in the `before` column were extracted from All
Joy`s interim results for the six months ended 31 August 2004;
- the headline earnings and earnings per share, reflected in the `after`
column, assume that the new issue of All Joy shares was effected on 1 March
2004 (being the first day after All Joy`s last annual reporting period).
It has been further assumed that the net proceeds of the issue were applied
to settle debt funding at an after-tax rate of 8,05% per annum for the six
months to 31 August 2004; and
- the net asset value and tangible net asset value per share reflected in the
`after` column assume that the new All Joy shares were issued on 31 August
2004.
Before (1) After Change
(cents) (cents)
Earnings per share (6%)
(2) 3.6 3.4
Headline earnings per (7%)
share (2) 3.9 3.6
Net asset value per 19%
share (3) 30.8 36.6
Net tangible asset 22%
value per share (3) 28.8 35.0
Notes:
1. Extracted from the interim results of All Joy for the six months ended 31
August 2004.
2. Adjusted to reflect the issue of new All Joy shares for the six months
ended 31 August 2004. It has further been assumed that the net proceeds of
the issue were applied to settle debt funding at an after-tax rate of 8,05%
per annum for the six months to 31 August 2004. Earnings and headline
earnings per share calculations were based on a weighted average number of
41,973,333 ordinary shares in issue for the six months ended 31 August
2004.
3. The net asset value and net tangible asset value per share calculations
were based on 41,973,333 ordinary shares in issue at 31 August 2004.
4. GENERAL MEETING AND DOCUMENTATION
A circular to All Joy shareholders containing details of the issue and
incorporating a notice of general meeting of shareholders will, subject to
approval by the JSE, be mailed to shareholders within 28 days of this
announcement or within such longer period as the JSE may allow in the
circumstances.
The directors of All Joy are excited about the future prospects, given All Joy`s
established position and the current market conditions and are looking forward
to work closely with the NEF with a view to advancing the Company`s position in
the South African food industry.
Johannesburg
29 December 2004
Corporate Advisor Designated Advisor
Corporate Solutions Exchange Sponsors
Date: 29/12/2004 01:19:20 PM
Produced by the JSE SENS Department
