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KAP International Holdings Limited - Property transactions with related parties
KAP INTERNATIONAL HOLDINGS LIMITED
Registration number: 1978/00181/06
JSE Share Code: KAP
ISIN: ZAE000059564
(`KAP`)
PROPERTY TRANSACTIONS WITH RELATED PARTIES
1. INTRODUCTION
1.1 Shareholders are advised that Feltex Holdings (Pty) Ltd (`Feltex`), a
wholly-owned subsidiary of KAP, has reached agreement on 25 July 2005 to
acquire various industrial properties from Courthiel Holdings (Pty) Ltd
(`Courthiel`) and Conrapp Properties (Pty) Ltd (`Conrapp`) for a total
consideration of R55,1 million (`the acquisitions`); and
1.2 shareholders are further advised that Kolosus Investments (Pty) Ltd
(`Kolosus`), also a wholly-owned subsidiary of KAP, has reached an
agreement on 25 July 2005 to sell an industrial property to African Hide
Trading (Pty) Ltd (`AHT`) for a total consideration of R5,5 million (`the
disposal`),(collectively, `the transactions`).
1.3 The effective date of the transactions will be the date of transfer of the
properties and the consideration is payable in cash. There are no
unfulfilled conditions precedent relating to the transactions.
2. RATIONALE FOR THE TRANSACTIONS
2.1 The properties to be acquired by Feltex are presently occupied by its
manufacturing operations. The nature of its business requires that the
properties be specifically designed, altered and customised to suit these
manufacturing operations. Feltex further has a need for continual expansion
of capacity and the flexibility to do so would be better achieved if the
properties are owned.
2.2 The property sold to AHT is leased to and occupied by AHT. This property
has been developed to suit the specific requirements of AHT. The board of
KAP has resolved to sell this property as it is not considered core to the
business of the group. The proceeds of the sale would be applied towards
the reduction of debt.
3. RELATED PARTY TRANSACTION
In terms of Section 10.7 of the Listings Requirements of the JSE Limited
(`JSE`) the transactions are regarded as a small related party transaction
as the ultimate controlling shareholder of Courthiel, Conrapp, AHT and KAP
is Mr CE Daun. Accordingly, KAP has appointed PSG Capital Limited (`PSG`)
as the independent professional expert in accordance with paragraph 10.7(b)
of the JSE`s Listings Requirements and has provided the JSE with written
confirmation (`the fair and reasonable opinion`) from PSG that the terms of
the transactions are fair and reasonable to KAP shareholders. The fair and
reasonable opinion will lie open for inspection at the registered office of
KAP for a period of 28 days from the date of publication of this
announcement.
4. FINANCIAL EFFECTS
The pro forma financial effects on KAP of the property transactions are not
significant (below 3%) and are therefore not provided.
Paarl
25 July 2005
Sponsor and independent professional expert
PSG Capital Limited
Date: 25/07/2005 02:14:06 PM
Produced by the JSE SENS Department
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