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Rentsure- Update on Rentsure`s disposal of its 70% interest in Rentmeester
Assurance Limited; Disposal of Alnet (Proprietary) Limited by
Rentmeester and withdrawal of cautionary announcement
Rentsure Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number 1946/023539/06)
Share code: RNT ISIN: ZAE000012811
(`Rentsure` or `the company`)
Update on Rentsure`s disposal of its 70% interest in Rentmeester Assurance
Limited (`Rentmeester`), disposal of Alnet (Proprietary) Limited (`Alnet`) by
Rentmeester and withdrawal of cautionary announcement
UPDATE ON RENTSURE`S DISPOSAL OF ITS 70% INTEREST IN RENTMEESTER
1.1 Introduction
Rentsure shareholders are referred to the announcement dated 25 November 2004,
which contained details of the company`s agreement with Capital Alliance Life
Limited (`the purchaser`), relating to the disposal of the company`s 70%
interest in Rentmeester (`the transaction`).
The transaction
1.2.1 Overview
Subject to Rentsure shareholders` approval and the fulfilment of the conditions
precedent as previously advised, Rentsure will dispose of its 70% interest in
Rentmeester to the purchaser for a cash consideration of R8 400 000, which shall
be reduced by any amount owing by Rentsure to Rentmeester at the effective date.
The purchaser has paid R20 000 000 into an escrow account, 70% of which will be
paid to Rentsure on 15 June 2005, together with interest thereon, provided there
are no adjustments in respect of certain assets of Rentmeester.
Rentekor (Proprietary) Limited (`Rentekor`), Rentsure`s controlling shareholder,
owns the remaining 30% in Rentmeester and has agreed to sell its 30% interest in
Rentmeester to the purchaser on pro-rata the same terms and conditions.
1.2.2 Financial effects of the transaction
Set out in the table below are the unaudited pro forma financial effects of the
transaction based on the audited consolidated financial statements of the
company at 30 June 2004 . The pro forma financial effects have been prepared
for illustrative purposes only to provide information as to how the transaction
may have impacted on the results and financial position of Rentsure. Because of
their nature, the pro forma financial effects may not give a fair reflection of
Rentsure`s financial position after the transaction or the effect on future
earnings.
Note Before the After the Percentage
transaction transaction Change
(cents) (cents) (%)
Loss and headline 1 (52.4) (3.4) 93.51
loss per share
Net asset value 2 9.9 18.5 86.87
per share
Net tangible 2 7.2 18.5 156.94
asset value per
share
Number of shares 40 438 40 438
in issue (`000)
Notes:
1. In relation to the loss and headline loss per share, the pro forma financial
effects of the transaction have been extracted from the audited results of the
company for the year ended 30 June 2004 and have been prepared on the following
assumptions:
- the transaction was effective on 1 July 2003;
- interest on the cash consideration of R8.4 million was calculated at a pre-
tax rate of 7.5% per annum; and
- the R20 million paid into an Escrow account has no benefit to the
shareholders of the company.
2. In relation to the net asset value and net tangible asset value per share,
the pro forma financial effects of the transaction have been extracted from the
audited results of the company for the year ended 30 June 2004 and have been
prepared on the following assumptions:
- the transaction was effective on 30 June 2004;
- the R20 million paid into an Escrow account has no benefit to the
shareholders of the company.
1.3 Documentation
A circular to Rentsure shareholders, which is subject to the approval of the JSE
Securities Exchange South Africa and the Securities Regulation Panel, setting
out details of the transaction and including a notice of a general meeting to be
held on or about Friday, 18 March 2005 will be posted to shareholders on or
about 28 February 2005.
2. DISPOSAL OF ALNET BY RENTMEESTER
Rentsure shareholders are referred to the announcement dated 20 December 2004
relating to the disposal of Alnet by Rentmeester and are advised that it is
anticipated that this disposal will only be finalised once the sale of
Rentsure`s 70% interest in Rentmeester has been implemented. Accordingly,
Rentsure shareholders will not be required to approve Rentmeester`s disposal of
Alnet.
3. WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT
As the financial effects of the transaction have now been published and the
disposal of Alnet by Rentmeester will not affect Rentsure shareholders, the
cautionary announcement is hereby withdrawn.
Pretoria
11 February 2005
Corporate advisor Sponsor Legal advisor
Bravura Equity Services Bridge Capital Services Rooth & Wessels Inc
(Pty) Ltd (Pty) Ltd
Independent Expert Reporting accountants
KPMG Services (Pty) Ltd and auditors
Jan Erasmus Auditors
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