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Prism - Amendment to proposed Black Economic Empowerment transaction and renewal
of cautionary announcement
Prism Holdings Limited
(Incorporated in the Republic of South Africa)
Registration number 1998/018949/06
Share code: PIM
ISIN: ZAE000022257
(`Prism`)
AMENDMENT TO PROPOSED BLACK ECONOMIC EMPOWERMENT (`BEE`) TRANSACTION AND RENEWAL
OF CAUTIONARY ANNOUNCEMENT
INTRODUCTION
Shareholders are referred to the announcement dated 9 December 2004 which
advised shareholders that Prism intends to conclude a BEE transaction that would
result in Mineworkers Investment Company (Proprietary) Limited (`MIC`) acquiring
a 16.89% stake in Prism through a newly incorporated company (`BEECo`)(`the BEE
transaction`).
In that announcement, Prism advised that it intended to propose a scheme of
arrangement (`scheme`) in terms of which 16.89 Prism shares would be acquired by
BEECo for every 100 Prism shares held by each Prism shareholder, at a price of
36 cents per share. The aggregate purchase price of R36 million was to be funded
by Prism and a financier subscribing for R18 million and R12,5 million worth of
redeemable fixed rate preference shares respectively, and by a R5,5 million
shareholder`s loan from MIC.
REVISED STRUCTURE
Following discussions with MIC and certain of Prism`s key shareholders, Prism
has elected to change the mechanism for the implementation of the BEE
transaction.
The revised structure, which envisages the BEE transaction being implemented by
way of a pro rata repurchase of shares as opposed to a scheme, has the
advantages of:
- participation being voluntary for shareholders;
- avoiding the complexity and cost of a scheme; and
- providing certainty in relation to the implementation of the BEE transaction,
as Prism has obtained irrevocable undertakings from shareholders to sell the 100
million shares required to ensure that the BEE transaction can be implemented
using the revised structure.
In terms of the revised structure, BEECo, which will initially be a wholly-owned
subsidiary of Prism, will purchase 100 million Prism shares (`the offer shares`)
by making a pro rata offer to Prism shareholders to acquire 16.89 shares for
every 100 shares held by each Prism shareholder at a price of 40 cents per Prism
share (`the offer`). The revised structure will be subject to the approval of
Prism`s shareholders in general meeting, in accordance with the Listings
Requirement of the JSE Securities Exchange South Africa.
The offer will be implemented on the following basis:
- Shareholders may tender shares over and above the 16.89 shares for every 100
shares held by them, which additional shares shall be acquired by BEECo on a pro
rata basis to the extent that they are required to ensure that all of the offer
shares are acquired by BEECo;
- Prism has obtained sufficient irrevocable undertakings from key shareholders
to tender additional shares, so as to ensure that BEECo will be able to acquire
all of the offer shares;
- 55 million of the offer shares will be acquired by BEECo by way of a specific
repurchase of shares in terms of section 89 of the Companies Act, 61 of 1973,
whereafter BEECo shall be sold to MIC with the remaining 45 million of the offer
shares to be acquired by BEECo subsequently.
The additional R4 million funding requirement that will result from the increase
in the offer price from 36 cents to 40 cents per Prism share will be borne by
increasing the preference share subscription to be made by Prism from R18
million to R22 million.
FURTHER ANNOUNCEMENT AND RENEWAL OF CAUTIONARY
A further announcement will be published once the final agreements governing the
BEE transaction have been concluded. This announcement will provide full details
of the BEE transaction, including the financial effects thereof.
Shareholders are advised to continue to exercise caution when dealing in their
Prism shares until publication of the further announcement referred to above.
Johannesburg
2 February 2005
Corporate advisor and legal advisor to Prism
Java Capital (Pty) Limited
Attorneys to MIC
MJ King Inc. Attorneys
Sponsor to Prism
Standard Bank
Date: 02/02/2005 08:58:03 AM
Produced by the JSE SENS Department
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