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Mvela - Issue of convertible, perpetual, cumulative preference shares
Mvelaphanda Group Limited
(formerly Rebserve Holdings Limited)
(Incorporated in the Republic of South Africa)
(Registration number 1995/004153/06)
Share code: MVG & ISIN: ZAE000060737
("Mvela") or ("the Company")
ISSUE OF CONVERTIBLE, PERPETUAL, CUMULATIVE PREFERENCE SHARES
INTRODUCTION
Shareholders are referred to the announcement dated 28 September 2005 in which
it was announced that Mvela intended to raise capital through the issue of
convertible, perpetual, cumulative preference shares ("preference shares") by
way of a private placement ("the private placement").
Mvela is pleased to announce that, pursuant to the private placement, 52 000 000
preference shares will be issued on 4 November 2005 at a price of R10.00 per
preference share, resulting in Mvela raising R520 million (before expenses). The
issue size may be increased in accordance with an option granted to The Standard
Bank of South Africa Limited, in its capacity as the underwriter of the private
placement, to subscribe for up to an additional 7 500 000 preference shares by
no later than 4 December 2005 ("the option").
SALIENT TERMS OF THE PREFERENCE SHARES
The salient terms of the preference shares are set out below.
Issue Price: R10.00 per preference share.
Issue Size: R520 000 000 (subject to an increase of up to R75 000
000 pursuant to the option).
Issue Date: 4 November 2005.
Conversion The preference shares will be convertible into new
Rights: Mvela ordinary shares at the election of the holder, at
any time from the First Conversion Date to the Final
Conversion Date, at the Conversion Price, subject to
certain restrictions.
Conversion R10.00 per ordinary share. The Conversion Price is
Price: subject to adjustment in certain events. The Conversion
Price represents a premium of approximately 35% to the
current market price of Mvela ordinary shares.
First 4 November 2009, being the fourth anniversary of the
Conversion Issue Date.
Date:
Final 4 November 2010, being the fifth anniversary of the
Conversion Issue Date.
Date:
Preference If declared, six-monthly, calculated in arrears in
Dividend: respect of the periods ending on 31 December and on 30
June each year.
Preference From the Issue Date to the Final Conversion Date, a
Dividend fixed rate of 5.5% per annum.
Rate:
From the Final Conversion Date into perpetuity (unless
redeemed by the Company), a floating rate of 80% of the
Average Prime Rate.
Company"s The preference shares will be redeemable by the Company
Redemption in whole or in part (to the extent that conversion has
Option: not taken place), semi-annually after the Final
Conversion Date.
Perpetual: Should a preference shareholder elect not to convert
its preference shares and should the Company not redeem
all the issued but unconverted preference shares, such
remaining preference shares will continue to exist as
preference shares in perpetuity.
PKF (Jhb) Inc. has considered the terms and conditions of the preference shares
and is of the opinion that the issue of the preference shares is fair and
reasonable to the shareholders of Mvela. A copy of their opinion is available
for inspection at the offices of Mvela for a period of 28 days from the date of
this announcement.
AUTHORISED AND ISSUED SHARE CAPITAL
Mvela"s authorised and issued share capital prior to the issue of the preference
shares is as set out below.
R
Authorised
750 000 000 ordinary shares of 0.1 cent 750 000
each
100 000 000 preference shares of 0.1 cent 100 000
each
Total 850 000
Issued
409 103 035 ordinary shares of 0.1 cent 409 103
each
Share premium 1 438 958 624
Total 1 439 367 727
Mvela"s authorised and issued share capital after the issue of the preference
shares is as set out below.
R
Authorised
750 000 000 ordinary shares of 0.1 cent 750 000
each
100 000 000 preference shares of 0.1 cent 100 000
each
Total 850 000
Issued
409 103 035 ordinary shares of 0.1 cent 409 103
each
52 000 000(1) preference shares of 0.1 52 000
cent each
Share premium 1 938 906 624
Total 1 939 367 727
(1) Excluding the issue of up to 7 500 000 preference shares pursuant to the
option.
FINANCIAL EFFECTS
The table below sets out the unaudited pro forma financial effects ("the pro
forma financial effects") of the private placement on Mvela"s reviewed earnings
per ordinary share, headline earnings per ordinary share and fully diluted
headline earnings per ordinary share for the year ended 30 June 2005, and net
asset value per ordinary share and net tangible asset value per ordinary share
at 30 June 2005. These pro forma financial effects are the responsibility of the
directors of Mvela and have been prepared for illustrative purposes only and,
because of their nature, may not provide a true reflection of the actual
financial effects on Mvela.
Reviewed Pro forma % Pro forma %
year after the Change after the Change
ended30 issueof conversion
June the of the
2005 preference preference
(cents) shares shares
Earnings per ordinary 123.0 120.0 (2.4) 120.0 (2.4)
share
Headline earnings per 135.5 132.5 (2.2) 132.5 (2.2)
ordinary share
Fully diluted headline 135.5 122.3 (9.8) 122.3 (9.8)
earnings per ordinary
share
Net asset value per 647.2 639.9 (1.1) 681.1 5.2
ordinary share
Net tangible asset value 493.9 486.7 (1.5) 545.3 10.4
per ordinary share
Number of ordinary shares 403.2 403.2 - 455.2 12.9
in issue (millions)
Weighted average number 306.3 306.3 - 306.3 -
of ordinary shares in
issue (millions)
Notes:
The pro forma financial effects are calculated on the assumption that 52 000 000
preference shares will be issued and exclude the potential issue of up to 7 500
000 preference shares pursuant to the option.
The "Reviewed year ended 30 June 2005" column is Mvela"s reviewed results for
the year ended 30 June 2005, which were published in the press on 9 September
2005.
The "Pro forma after the issue of the preference shares" column of the table is
calculated using the following assumptions:
52 000 000 preference shares were issued on 1 July 2004 at an issue price of
R10.00 per preference share, amounting to R520 000 000 of capital raised (before
expenses);
interest was earned on a net amount of R 500 000 000 (after deducting share
issue expenses) at an after tax rate of 4.6% per annum; and
preference dividends were paid on the preference shares on 31 December 2004 and
30 June 2005 at a rate of 5.5% per annum.
The "Pro forma after the conversion of the preference shares " column of the
table is calculated using the following assumptions:
the transactions set out in note 3 above were implemented as detailed above; and
the 52 000 000 preference shares converted into 52 000 000 ordinary shares on 30
June 2005 at a conversion price of R10.00 per ordinary share.
The percentage change columns are calculated with reference to the "Reviewed
year ended 30 June 2005" column.
LISTING OF THE PREFERENCE SHARES ON THE JSE LIMITED
The JSE Limited ("the JSE") has granted the listing of the 52 000 000 preference
shares under the share code "MVGP", abbreviated name MVG GRP Pref and ISIN
ZAE000073540 in the "Cyclical Services - Support Services" sector of the Main
Board of the JSE. The listing of the preference shares will be effective from
the commencement of business on Friday, 4 November 2005.
FURTHER DOCUMENTATION
A final offering circular containing full details of the preference shares and
the private placement may be obtained during normal business hours from Monday,
7 November 2005 to Monday, 21 November 2005 from:
Mvelaphanda Group Limited, Hunts End, 36 Wierda Road West, Wierda Valley,
Sandton;
The Standard Bank of South Africa Limited, Entrance 2, Fifth Floor, 3 Simmonds
Street, Johannesburg;
Deutsche Securities (SA) (Proprietary) Limited, 3 Exchange Square, 87 Maude
Street, Sandton; and
Computershare Investor Services 2004 (Proprietary) Limited, Ground Floor, 70
Marshall Street, Johannesburg.
In addition, the final offering circular will be available on the Company"s
website, www.mvelagroup.co.za.
Sandton
3 November 2005
Lead manager and Attorneys to Mvela Lead sponsor
transaction sponsor
Standard Bank Werksmans Deutsche Securities
Independent expert Attorneys to Lead manager
PKF (Jhb) Inc WWB
Date: 03/11/2005 12:50:08 PM Produced by the JSE SENS Department
