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Transpaco Limited - Acquisition and further cautionary announcement
TRANSPACO LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1951/000799/06)
Share code : TPC ISIN : ZAE00007480
(`Transpaco`)
ACQUISITION AND FURTHER CAUTIONARY ANNOUNCEMENT
1. Introduction
Further to the cautionary announcement dated 15 February 2005, Investec Bank
Limited is authorised to announce that Transpaco Limited has successfully
concluded its negotiations for the acquisition of Britepak Trading (Pty) Ltd
(`Britepak`) with effect from 1 March 2005 subject to the condition specified
below.
2. Nature of business of Britepak and rationale for acquisition
Britepak was founded in 1974 and supplies printed folded cartons, instruction
leaflets, cut labels and general print for use in the pharmaceutical,
healthcare, cosmetic, hair care and related industries.
Transpaco currently derives a major portion of its income from plastic based
materials. The diversification into high quality printed cartons enables
Transpaco to participate in another packaging industry not dependant on plastic
raw material. Britepak was identified due to its exceptional quality, customer
profile and value added niche market.
Salient terms of the acquisition
Transpaco will purchase 100% of the shares in Britepak from The Dudley Leon
Almarie & Audrey Trust, The Dada Family Trust, G Dada, F Davies, J Latter and D
McLaughlin (`The Vendors`) for R18.5 million payable on the closing date. The
consideration will be paid out of Transpaco`s resources.
The sellers have given Transpaco the usual warranties for a transaction of this
nature and appropriate restraints of trade. G Dada and D McLaughlin are
retiring. F Davis and J Latter have entered into 3 and 5 year service contracts
respectively. Thus continuity of management is assured. No retrenchments are
contemplated.
Conditions precedent
The acquisition is conditional on a successful conclusion of a due diligence
investigation by Transpaco into Britepak.
5. Effective Date
The effective date of the acquisition is 1 March 2005 with the closing date
being the first business day of the month following the month during which the
condition will have been fulfilled or waived.
6. Financial effects of the acquisition
Based on the reviewed results of Transpaco and unaudited results of Britepak for
the 6 months ended 31 December 2004, the acquisition would not have had a
significant effect on the headline earnings per Transpaco share, assuming that
the acquisition had been in effect for the 6 months ended 31 December 2004. The
acquisition is expected to make a positive contribution to the future earnings
of Transpaco.
Had the Britepak acquisition taken place at 31 December 2004 based on the net
tangible asset value of Britepak reflected in the accounting records at that
date, the pro-forma net asset value per Transpaco share would have decreased
from 392 cents to 376 cents, a change of 4.1%
7. Categorisation of the acquisition
The acquisition is a category 3 transaction in terms of section 9.5(a) of the
listing requirements of the JSE Securities Exchange South Africa.
Other proposals including a black economic empowerment
The discussions dealing with various proposals in relation to Transpaco`s
affairs including black economic empowerment continue.
Further cautionary announcement
Transpaco shareholders are advised to continue to exercise caution when dealing
in Transpaco shares pending further announcements in regard to the matters
referred to above.
Johannesburg
10 March 2005
Sponsor Legal Advisor
Investec Bank Limited Werksmans Incorporated
(Registration number 1990/005857/21)
Date: 10/03/2005 03:50:18 PM
Produced by the JSE SENS Department
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