| Thu 20 Oct 2005, 8:44 | | Investec - Odd-lot offer; Amendments to the takeov |
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Investec - Odd-lot offer; Amendments to the takeover provisions; The adoption of
a new Incentive Plan
INVESTEC LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1925/002833/06)
JSE share code: INL & ISIN: ZAE000040531
("Investec Limited")
INVESTEC PLC
Incorporated in England and Wales
Registration number 3633621
JSE share code: INP & ISIN: GB0031773103
("Investec plc")
(jointly "Investec")
ANNOUNCEMENT TO INVESTEC MEMBERS REGARDING:
* an odd-lot offer to Investec Members (the "Odd-lot Offer");
* amendments to the takeover provisions contained in the articles of
association of Investec Limited and Investec plc; and
* the adoption of a new Incentive Plan by Investec plc
(collectively the "Proposals")
1. INTRODUCTION
Investec has proposed a tender offer to Investec Members, known in South Africa
as an Odd-lot Offer, whereby holders of less than 100 ordinary shares in
Investec Limited and holders of less than 100 ordinary shares in Investec plc
(collectively "Odd-lot Holders") are given the option to sell their holdings to
Investec.
Amendments are also proposed to the takeover provisions contained in the
articles of association of Investec Limited and Investec plc, and the
introduction of a new Incentive Plan by Investec plc.
Implementation of the Odd-lot Offer, the amendments to the takeover provisions
and the introduction of the new Incentive Plan are subject to receiving the
prior approval of Investec Limited Members and Investec plc Members of the
resolutions to be proposed at the Investec Limited General Meeting and the
Investec plc Extraordinary General Meeting respectively (collectively, the
"Investec General Meetings"), scheduled for Monday, 14 November 2005 and, where
necessary, the registration of the resolutions.
The Boards of Investec Limited and Investec plc consider the Proposals to be in
the best interests of Investec Members as a whole and accordingly unanimously
recommend Investec Members to vote in favour of the Proposals.
2. RATIONALE FOR THE ODD-LOT OFFER
The Investec Directors believe that the cost to Odd-lot Holders of selling their
Investec Shares is, generally, disproportionate to the size of their holding
putting them in a different position to larger shareholders. The Odd-lot Offer
therefore provides Odd-lot Holders an affordable exit strategy. Odd-lot Holders
who choose to sell will be given the opportunity to realise the maximum possible
proceeds from the sale of their Investec Shares and will not have to pay the
transaction costs typically payable on a disposal of shares (such as trading
costs and transfer duty) as these costs will be paid by Investec.
Also, there are a large number of Odd-lot Holders constituting a small
percentage of the share capital. The recurring costs connected with servicing
such a large number of Odd-lot Holders is borne, indirectly, by all Investec
Members. The Investec Directors believe that these costs are disproportionate to
the size of the Odd-lot holding and, accordingly, believe that the Odd-lot Offer
is to the benefit of Investec Members as a whole.
At 10 October 2005, 7,760 out of 12,359 registered Investec Limited Members held
fewer than 100 Investec Limited Shares ("Investec Limited Odd-lot Holders")
constituting only 0.4 per cent of the total number of Investec Limited Shares in
issue, and 6,963 out of 14,506 registered Investec plc Members held fewer than
100 Investec plc Shares ("Investec plc Odd-lot Holders") constituting only 0.3
per cent of the total number of Investec plc Shares in issue.
3. DETAILS OF THE ODD-LOT OFFER
Under the terms of the Odd-lot Offer:
a) Investec Limited Odd-lot Holders who hold less than 100 Investec Limited
Shares at the close of business on the Record Date, expected to be Friday, 2
December 2005, can elect to:
* sell their Investec Limited Shares to a subsidiary of Investec Limited at a 5
per cent premium to the volume weighted average price of Investec Limited Shares
traded on the JSE over the five trading days prior to Friday, 18 November 2005;
or
* retain their Odd-lot holdings.
b) Investec plc Odd-lot Holders who hold less than 100 Investec plc Shares at
the close of business on the Record Date, expected to be Friday, 2 December
2005, can elect to:
* sell their Investec plc Shares to Investec plc at a 5 per cent premium to the
volume weighted average price of their Investec plc Shares over the five trading
days prior to Friday, 18 November 2005; or
* retain their Odd-lot holdings.
Members who are both Investec Limited Odd-lot Holders and Investec plc Odd-lot
Holders will be able to participate in both the Investec Limited and Investec
plc portions of the Odd-lot Offer.
Investec Limited Odd-lot Holders and Investec plc Odd-lot Holders recorded on
the South African branch register will be paid in Rand and Investec plc Odd-lot
Holders recorded on the UK share register will be paid in Pounds Sterling.
Odd-lot Holders should note that, should they fail to validly exercise their
election, then their Odd-lot holdings will be sold to Investec and the net
proceeds paid to them (unless, in the case of the Investec plc Odd-lot Offer,
they hold their Investec plc Shares through CREST). Repurchases will be made
persuant to a specific shareholder authority.
4. SALIENT DATES AND TIMES
2005
Election period for the Odd-lot Offer opens Monday, 24 October
Investec Limited and Investec plc Offer Price finalised
and announced on RIS and SENS on Friday, 18 November
Last day to trade for Investec Limited Members and
Investec plc Members on the South African branch
register in order to participate in/be eligible for the
Odd-lot Offer on Friday, 25 November
Last day to trade for Investec plc Members on the
UK share register in order to participate in/be eligible
for the Odd-lot Offer on Tuesday, 29 November
Election period for the Odd-lot Offer closes at 12:00
(SA/UK time) on Friday, 2 December
Record date to determine those Investec Limited
Members and Investec plc Members entitled to participate
in the Odd-lot Offer at the close of business on Friday, 2 December
Implementation of the Odd-lot Offer takes effect and
payment commences from Monday, 5 December
Notes:
(1) The above dates and times are subject to change. Any changes will be
released on RIS and SENS and published in the South African press.
(2) Odd-lot Holders may not dematerialise or rematerialise their Investec
Limited Shares or their Investec plc Shares recorded on the South African branch
register between Monday, 28 November and Friday, 2 December 2005 both dates
inclusive.
(3) Transfers between the UK and South African share registers of Investec plc
may not take place between Monday, 28 November and Friday, 2 December 2005 both
dates inclusive.
5. FINANCIAL EFFECTS OF THE ODD-LOT OFFER
The Odd-lot Offer and the potential buyback of Investec Shares by a subsidiary
of Investec Limited and Investec plc will have no significant effect on the
earnings, headline earnings per ordinary share, net asset value or tangible net
asset value per ordinary share of Investec Limited or Investec plc. Any Investec
Shares acquired by Investec pursuant to the terms of the Odd-lot Offer will be
held in treasury and, accordingly, the Odd-lot Offer will have no effect on the
issued ordinary share capital of Investec Limited or Investec plc.
6. TAKEOVER PROVISIONS
The Investec Directors are proposing amendments to the takeover provisions
contained in the articles of association of both Investec Limited and Investec
plc. These provisions were originally put in place when the DLC structure was
created to seek to ensure that any potential bidder would have to make a bid for
Investec as a whole rather than being able to make a bid for either Investec
Limited or Investec plc alone. The proposed amendments seek to protect this
position whilst ensuring that the provisions in the articles of association of
Investec Limited and Investec plc comply with the EU Takeover Directive which is
due to be brought into effect in the United Kingdom in the first half of 2006.
7. THE INCENTIVE PLAN
The Investec Directors are proposing the introduction of a new Incentive Plan
for Investec plc. The introduction of this new plan requires the approval of
Investec Members at the Investec General Meetings. In addition, the Investec
Directors are proposing that, conditional on approval of the Incentive Plan,
Investec Limited be authorised to establish further plans, based on the
Incentive Plan, for the benefit of Investec Limited employees.
8. GENERAL MEETINGS
The General Meeting of Investec Limited and the Extraordinary General Meeting of
Investec plc, to consider the resolutions required to implement the Proposals
will be held at the offices of Investec Limited, 100 Grayston Drive, Sandown,
Sandton, South Africa, 2196 and at the offices of Investec plc, 2 Gresham
Street, London, EC2V 7QP, United Kingdom, respectively. The Investec General
Meetings will be held at 15:00 (SA time) and 13:00 (UK time) on Monday, 14
November 2005.
9. CIRCULAR
A circular containing details of the Proposals will be posted to Investec
Members today, 20 October 2005, and is available on Investec"s website under
Investor Relations (www.investec.com). Full details of the action to be taken by
Investec Members in respect of the Investec General Meetings and the Proposals
are set out in the circular.
Johannesburg/London
20 October 2005
Financial adviser
Merrill Lynch
Global Markets & Investment Banking Group
Merrill Lynch International
Registered in England
Registration number 2312079
Regulated in the United Kingdom
by The Financial Services Authority
Joint sponsor
Investec Bank Limited
(Registration number 1969/004763/06)
Lead sponsor in South Africa
Merrill Lynch
Global Markets & Investment Banking Group
Merrill Lynch South Africa (Pty) Ltd
Registration number 1995/001805/07
Registered Sponsor and Member of the
JSE Securities Exchange South Africa
Legal adviser in the UK
Linklaters
Legal adviser in South Africa
Jowell Glyn & Marais
