|
Remgro - Terms announcement in respect of the disposal by Remgro of all or part
of its interest in Absa
REMGRO LIMITED
(Incorporated in the Republic of South Africa)
(Registration number: 1968/006415/06)
SHARE CODE: REM ISIN: ZAE000026480
(`Remgro`)
Terms announcement in respect of the disposal by Remgro of all or part of its
interest in Absa Group Limited (`Absa`) (`the disposal`)
1. Introduction
Rand Merchant Bank, a division of FirstRand Bank Limited (`RMB`) is authorised
to announce that Remgro has entered into an agreement with Barclays Bank PLC
(`Barclays`) on 5 May 2005 whereby Remgro has undertaken to dispose of all or
part of its interest in Absa. Remgro, through its wholly owned subsidiary,
Financial Securities Limited, owns 61.4 million ordinary shares, being 9.3% of
the total issued ordinary share capital in Absa.
For further detail, Remgro shareholders are referred to the joint announcement
released today on SENS by Absa and Barclays (`the joint announcement`).
2. Rationale for the disposal
Remgro currently has a significant exposure to the South African financial
services sector, through its strategic investments in two competitor groups,
namely Absa and the FirstRand group. The acquisition by Barclays of 60% in Absa
(`the Barclays transaction`) provides Remgro with an opportunity to realise a
substantial portion, and possibly its total interest in Absa on attractive
terms.
Subsequent to the Barclays transaction, Remgro will retain a significant
exposure in this sector primarily through its shareholding in the FirstRand
group.
3. Terms of the disposal
3.1 Disposal consideration and mechanism
The Barclays transaction will be implemented through two inter-
conditional processes:
- a scheme of arrangement in terms of section 311 of the Companies
Act, whereby Barclays will acquire 32% of the Absa ordinary
shares held by each Absa ordinary shareholder, excluding the Absa
Group Limited Share Incentive Scheme Trust (`Absa Share Trust`)
and Barclays and its subsidiaries, save to the extent that they
hold Absa shares on behalf of third parties; and
- a partial offer by Barclays to acquire an additional 28% of the
Absa ordinary shares held by each Absa ordinary shareholder.
The consideration payable to Absa ordinary shareholders for each ordinary share
disposed of is R82.50 plus the entitlement to receive the final dividend of
R2.00 declared by Absa in respect of its financial year to 31 March 2005. The
total cash consideration, including the aforementioned dividend, will therefore
be R84.50 per share.
3.2 Effective date
The effective date of the disposal will be determined by the operative
date of the scheme of arrangement and the record date of the partial
offer. These dates will be made available in future announcements by
Absa.
3.3 Additional shares tendered
To the extent that Barclays does not secure sufficient acceptances to
reach the required level of 60% shareholding in Absa, Remgro has
agreed to tender additional Absa shares, up to Remgro`s total
shareholding, as part of the partial offer. Barclays will acquire
such additional shares from Remgro on the same terms and conditions as
all other Absa shares subject to the Barclays transaction.
4. Financial effects on Remgro
The pro forma financial effects of the disposal have been prepared for
illustrative purposes only and are set out below:
Column 1 Column 2
Note Before the After the Change
disposal disposal (%)
(cents) (cents)
Earnings per share 1 723.9 1063.3 46.9%
Headline earnings per share 1 492.0 467.6 (5.0%)
Net asset value per share 2 6406 6890 7.6%
Net tangible asset value per share 2 5752 6236 8.4%
Number of shares in issue (`million) 496.2
Weighted average number of shares in 500.4
issue (`million)
Notes:
1. Column 1 reflects the unaudited earnings and headline earnings per share
for the 6 months ended 30 September 2004. Column 2 reflects the effective
earnings and headline earnings per share for the 6 months ended 30
September 2004 based on the following principal assumptions:
- the disposal was effective 1 April 2004;
- only 60% of its holding in Absa will be sold to Barclays; and
- the sale proceeds were invested in interest bearing assets at an
average after tax interest rate of 5.3%.
2. Column 1 reflects the unaudited net asset value and net tangible asset
value per share at 30 September 2004. Column 2 reflects the effective net
asset value and net tangible asset value per share on 30 September 2004
assuming the transaction was effected on 30 September 2004.
3. The net asset value attributable to 100% of Remgro`s holding in Absa as at
30 September 2004 was R1 994 million. The net profit after taxation for the
6 months ended 30 September 2004 attributable to 100% of Remgro`s holding
in Absa was R226 million.
4. Conditions precedent
The disposal is subject to certain conditions precedent. Shareholders are
referred to the joint announcement by Absa and Barclays in this regard.
5. Application of the sale proceeds
As a result of the uncertainty regarding the number of shares that Barclays
will acquire from Remgro and the fact that certain conditions precedent
remain unfulfilled, Remgro will provide further information as to the
possible application of the sale proceeds when it reports its annual
financial results towards the end of June 2005.
Remgro Limited
Stellenbosch
9 May 2005
Merchant bank and Sponsor to Remgro
RAND MERCHANT BANK (A division of FirstRand Bank Limited)
CORPORATE FINANCE
| Profile Group (Pty) Ltd. has taken care in preparing all information on this website, but does not accept any liability for errors or out-of-date information. | |||||||||||||
| Other Profile Group sites: FundsData Online (unit trust data) | Profile Group corporate site | |||||||||||||
| [ Terms of Use | Privacy Policy | PAIA manual | FAQs/Help | Site Map | © Copyright Reserved 2026 ] | |||||||||||||
|
|||||||||||||
