| Wed 31 Aug 2005, 8:54 | | JD Group Limited/Connection - Proposed Scheme Of A |
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JD Group Limited/Connection - Proposed Scheme Of Arrangement
JD Group Limited
(Incorporated in the Republic of South Africa)
(Registration number 1981/009108/06)
(Share code: JDG & ISIN: ZAE000030771)
(`JDG`)
Connection Group Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number 1997/005390/06)
(Share code: CCT & ISIN: ZAE000042529)
(`Connection`)
PROPOSED SCHEME OF ARRANGEMENT BETWEEN CONNECTION AND ITS SHAREHOLDERS
1. Introduction
Connection shareholders are referred to the announcement issued by JDG and
Connection on 1 August 2005 in which it was announced that JDG had submitted to
the board of directors of Connection (`the Connection Board`) a notice of its
firm intention to make an offer to acquire all the shares in the issued ordinary
share capital of Connection (`the offer`) for a consideration of R14,75 per
share (`scheme consideration`). The offer is subject to the fulfilment of
certain conditions precedent, details of which are set out in the circular
referred to in paragraph 6 below.
It is intended that the offer will be implemented by way of a scheme of
arrangement in terms of section 311 of the Companies Act No 61 of 1973, as
amended (`the Companies Act`) to be proposed between Connection and its
shareholders (`the scheme`), other than Software Connection (Proprietary)
Limited, a wholly owned subsidiary of Connection and the holder of treasury
shares, the Connection Group Holdings Share Trust Scheme in respect of the
shares held by it (`the excluded parties`) (`the scheme members`).
In the event that the scheme does not become operative for any reason, JDG will
be deemed to have made a substitute offer to the scheme members at an amount
equal to the scheme consideration (`the substitute offer`). The substitute offer
is conditional upon at least nine-tenths of scheme members` acceptance thereof,
in which event JDG intends to invoke the provisions of Section 440K of the
Companies Act.
2. Opinions and recommendations
Investec Bank Limited (`Investec`) has been appointed by the board of directors
of Connection (`Connection Board`) as an independent advisor to advise the
Connection Board on whether the terms and conditions of the offer or, failing
implementation thereof, the substitute offer are fair and reasonable to
Connection shareholders. Investec has considered the terms and conditions of the
scheme and the substitute offer and are of the opinion that the terms and
conditions of the scheme and the substitute offer, if applicable, are fair and
reasonable to Connection shareholders.
The directors of Connection, whose interests are fully disclosed in the circular
referred to in paragraph 6 below, have considered the terms and conditions of
the scheme and substitute offer and are of the opinion that the terms and
conditions of the scheme and the substitute offer, if applicable, are fair and
reasonable to Connection shareholders. They intend to vote in favour of the
scheme in respect of their own shareholdings in Connection, and recommend that
other Connection shareholders do likewise.
3. Shareholder support
Connection shareholders, other than the excluded parties, which hold 62,7% of
all shares held by scheme members, have indicated their support for the scheme.
4. Scheme meeting
In terms of an Order of the High Court of South Africa (Witwatersrand Local
Division), dated Tuesday, 30 August 2005, the scheme meeting is to be held at
the registered office of Connection, 6 Mellis Road, Mellis Park, Rivonia,
Sandton at 10:00 on Friday, 28 October 2005 to consider and, if deemed fit,
approve the scheme.
5. Salient dates and times
The expected dates and times in relation to the scheme, for the attention of
Connection shareholders, are set out below.
2005
Last day to trade in order to vote at the scheme
meeting on Wednesday, 19 October
Record date on which shareholders must be recorded in
the register in order to vote at the scheme meeting
on Wednesday, 26 October
Last day for receipt of proxies for the scheme
meeting by 10:00 on Thursday, 27 October
Scheme meeting to be held at 10:00 on Friday, 28 October
Results of the scheme meeting released on Securities
Exchange News (`SENS`) on Friday, 28 October
Results of the scheme meeting published in the press
on Monday, 31 October
Court hearing to sanction the scheme on Tuesday, 8 November
Announcement of Court sanctioning of the scheme
released on SENS on Tuesday, 8 November
Announcement of Court sanctioning of the scheme
published in the press on Wednesday, 9 November
If the scheme is sanctioned and implemented:
Last day to trade for shareholders to be eligible to
receive the scheme consideration on (after which no
dematerialisation or rematerialisation of Connection
share certificates may take place)
Friday, 11 November
Suspension of listing of Connection shares at
commencement of trading on Monday, 14 November
Last day on which shareholders must be recorded in
the register in order to receive the scheme
consideration by close of trading on Friday, 18 November
Operative date of the scheme at the commencement of Monday, 21 November
trading on
Scheme consideration posted to certificated scheme Monday, 21 November
participants (if documents of title are received on
or prior to the record date) on or about or, failing
receipt of documents of title on or before the record
date, within five business days of receipt thereof by
the transfer secretaries
Dematerialised scheme participants have their Monday, 21 November
accounts held at their CSDP/broker credited with the
scheme consideration on
Termination of listing of the Connection shares on Tuesday, 22 November
the JSE at the commencement of trading on
Notes:
1. These dates and times are subject to change. Any such change will be
released on SENS and published in the press.
2. If a form of proxy is not received by the time and date shown above, it may
be handed to the chairperson of the scheme meeting, no later than 10
minutes before the commencement of the meeting.
3. Shareholders should note that as Connection is settling in the STRATE
environment, settlement for trade takes place five business days after such
trade. Therefore shareholders who acquire Connection shares after
Wednesday, 19 October 2005 will not be eligible to vote at the scheme
meeting.
4. If all conditions precedent, which include, inter alia, Competition
Tribunal approval, have not yet been fulfilled by the date of the Court
hearing, which is Tuesday, 8 November 2005, then the scheme may be
conditionally sanctioned subject to such condition being timeously
fulfilled, that is on or before 31 March 2006 or the date of the Court
hearing therefor may be extended from time to time until at the latest, 31
March 2006. This will result in all dates from Tuesday, 8 November 2005
onwards changing from those that are set out in the timetable above.
Shareholders will be informed of any such changes to the above timetable by
way of an announcement released on SENS and published in the press.
In the event that the scheme does not become operative for any reason and the
substitute offer is made, the salient dates and times of the substitute offer
will be released on SENS and published in the press.
6. Documentation
A circular providing further information on the scheme and containing, inter
alia, a notice of scheme meeting, a form of proxy and a form of substitute offer
acceptance and surrender, will be posted to Connection shareholders on
Wednesday, 31 August 2005.
Johannesburg
30 August 2005
Financial advisor and transaction sponsor to JDG
ABSA Corporate & Merchant Bank
Merchant bank and sponsor to Connection
Rand Merchant Bank (A division of FirstRand Bank Limited)
Independent advisor to Connection
Investec Corporate Finance
Attorneys to JDG
Feinsteins Attorneus
Corporate legal advisors to Connection
PAUL BOTHA &
ASSOCIATES (PTY) LTD
Sponsor to JDG
PSG Capital
