|
Afgri - Acquisition by Afgri Operations Limited of Daybreak Farms (Pty) Limited
AFGRI LIMITED
(Incorporated in the Republic of South Africa)
Registration number: 1995/004030/06
Share Code: AFR
ISIN: ZAE000040549
("AFGRI" or "the company")
ACQUISITION BY AFGRI OPERATIONS LIMITED (AFGRI OPERATIONS)OF DAYBREAK FARMS
(PTY) LIMITED (DAYBREAK FARMS)
1. THE TRANSACTION
Shareholders are advised that on 28 October 2005 AFGRI Operations, a wholly-
owned subsidiary of AFGRI, acting on behalf of the AFGRI Sizwe Partnership,
exercised its option in terms of an Option Agreement entered into with Daybreak
Farms and its private owners ("the Sellers") during June 2005, to acquire 100%
of the shareholding in Daybreak Farms and a controlling interest in its
subsidiaries and associates ("the Transaction").
2. RATIONALE FOR THE ACQUISITION
AFGRI Operations exited its investment in Earlybird Farm (Pty) Ltd in 2004 due
to restrictions in the shareholders agreement which prevented it from further
expansion in the broiler industry.
AFGRI Operations wished to participate in the broiler industry as it contributes
40% of the total market for protein for human consumption and consumes over 50%
of animal feed produced by the formal animal feed industry. It is also the
fastest growing source of protein for human consumption. It is a strategic
imperative for AFGRI Operations to participate in this market to ensure growth
for its Animal Feeds business.
Daybreak Farms is a successful broiler operation with an excellent track record,
close to the Gauteng market. It currently slaughters close to 500 000 birds per
week and has the capacity to increase this to 600 000 birds per week. It is
AFGRI Operations" intention to double this business in the long term, and with
it, its Animal Feeds business.
3. TERMS AND CONDITIONS OF THE TRANSACTION
3.1 Salient terms and conditions
The purchase consideration will be R110 million minus the quantum of the
increase in interest bearing debt as from 30 June 2005 to the effective date or
plus the quantum of the decrease in interest bearing debt as from 30 June 2005
to the effective date.
The effective date of the Transaction will be the date of fulfillment of the
last of the suspensive conditions set out in 2.2 below.
3.2 Suspensive conditions
Implementation of the Transaction is subject to fulfillment of the following
suspensive conditions by 28 April 2006, being within six months after exercise
of the options:
The completion of a due diligence investigation into the Companies listed under
item 3.4 hereunder, to the satisfaction of AFGRI Operations.
The requisite statutory and regulatory approvals being obtained, including the
approval of the relevant Competition Authorities.
The conclusion of a service contract between Daybreak Farms and I G Taylor.
The waiver by the shareholders other than Daybreak Farms or the sellers of
whatever pre-emptive or other rights they may enjoy to acquire any portion of
any subsidiary company equity.
The dates for fulfillment of the suspensive conditions are stipulated for the
benefit of AFGRI Operations, who may extend any such date by notice in writing
to the Sellers or waive fulfillment of any one or more of them, either partially
or in full.
3.3 Payment of the purchase consideration
The purchase consideration is payable to the Sellers in cash as follows:
R90 million on the third business day following the effective date.
The balance on the third business day following the final determination of the
increase or decrease in the interest bearing debt.
3.4 Specified shareholding interest to be acquired by AFGRI Operations
100% of the entire issued share capital and shareholders
claims of Daybreak Farms and shareholders claims.
50% of the entire issued share capital Daybreak Super
Marketing (Pty) Ltd.
100% of the entire issued share capital and shareholders
of claims Daybreak Properties Springs (Pty) Ltd.
50% of the entire issued share capital and shareholders
claims of Die Plaas Olifantsfontein 196.
50% of the entire issued share capital and shareholders
claims of Superior Foods (Pty) Ltd.
100% of the entire issued share capital and Shareholders
claims of Telsek 1001 (Pty) Ltd.
50% of the entire issued share capital and shareholders
claims of Telsek 1013 (Pty) Ltd.
65% of the entire issued share capital and shareholders
claims of Waltmerwe Park (Pty) Ltd.
4 Pro forma financial effects
Set out below are the unaudited pro forma financial effects on AFGRI in respect
of the implementation of the transaction by AFGRI Operations, based on the
audited financial statements of AFGRI for the financial year ended 28 February
2005, had it been implemented on 1 March 2004. The pro forma financial effects
are the responsibility of the board and have been prepared for illustrative
purposes only. The pro forma financial effects may not give a fair reflection of
a shareholder"s financial position after the Transaction.
Audited Pro Forma Change %
Before (1) After (2)
(cents) cents
Basic earnings per share 45.2 49.0 +8.3%
Headline earnings per 44.5 48.3 +8.5%
share
Notes:
The financial information set out above is based on the audited financial
results for AFGRI for the year ended 28 February 2005. The weighted average
number of shares in issue for purposes of the calculations is 331 103 785.
Assuming that the Transaction was implemented on 1 March 2004 (for the purpose
of calculating basic earnings per share and headline earnings per share).
The Transaction has been funded by available cash facilities and therefore has
no significant effect on net asset value per share and net tangible asset per
share and therefore has not been disclosed.
5 SUBSIDIARY ARTICLES
The articles of association of Daybreak Farms will be amended to conform with
Schedule 10 of the JSE Limited Listings Requirements.
Johannesburg
7 November 2005
Sponsor
RAND MERCHANT BANK (a division of FirstRand Bank Limited)
Date: 07/11/2005 10:06:04 AM Produced by the JSE SENS Department
| 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 ] | |||||||||||||
|
|||||||||||||
