| Mon 20 Feb 2006, 17:32 | | Enaleni - IDC approves the funding of Enaleni BEE |
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Enaleni - IDC approves the funding of Enaleni BEE transaction
Enaleni Pharmaceuticals Limited
(Incorporated in the Republic of South Africa)
(Registration number 2002/018027/06)
(JSE code: ENL & ISIN: ZAE000067740)
("Enaleni" or "the company")
FORMAL APPROVAL OF THE FUNDING OF THE ENALENI BLACK ECONOMIC EMPOWERMENT
TRANSACTION ("ENALENI BEE TRANSACTION") BY THE BOARD OF THE INDUSTRIAL
DEVELOPMENT CORPORATION ("IDC") AS PART OF THE ACQUISITION BY ENALENI OF CIPLA
MEDPRO HOLDINGS (PTY) LIMITED ("CIPLA MEDPRO TRANSACTION")
1. Introduction
1.1 The directors of Enaleni are pleased to advise shareholders that on
Tuesday, 14 February 2006 the IDC Board formally approved the funding
for the subscription of 90 million ordinary shares in Enaleni, to the
value of R270 million, by two BEE consortiums, one comprising outside
BEE parties as set out in paragraph 4 below and one comprising Enaleni
management and employees. Gert Gouws, IDC Chief Financial Officer
says: "This deal offers us an opportunity to help create the largest
BEE company in the pharmaceutical sector.". The formal approval of
the funding for the transaction will enable Enaleni to maintain its
status as the leading BEE pharmaceutical company in South Africa with
its empowerment shareholding in excess of 33%.
1.2 The Cipla Medpro transaction became unconditional on 14 December 2005
with the Enaleni BEE transaction being underwritten by Foord Asset
Management (Pty) Limited and bridging capital being provided in the
interim by Nedbank Limited.
2. Rationale for the Enaleni BEE transaction
2.1 Enaleni has committed itself since its inception to the promotion of
BEE and the upliftment of previously disadvantaged, as it acknowledges
that meaningful participation of black people in the South African
economy is essential to the successful and sustainable economic growth
of the country.
2.2 Enaleni"s new BEE shareholders as described in paragraph 4 below are
truly broad-based with the capability of adding significant value to
Enaleni in the healthcare industry.
2.3 As part of the Cipla Medpro transaction, 90 million ordinary shares at
300 cents per share were earmarked for BEE to ensure that Enaleni
retains its status as the leading BEE pharmaceutical company in South
Africa.
3. The Enaleni BEE transaction
3.1 The subscription by the Enaleni BEE consortiums for the 90 million
ordinary shares at 300 cents per shares is funded by cash
contributions made by the Enaleni BEE consortiums to the amount of R30
million and the difference by the IDC through the subscription of R240
million (excluding costs) zero coupon participating redeemable
preference shares.
3.2 The Enaleni BEE consortiums will effectively be locked in for the
first three years following the receipt by them of the shares.
4. Details of the prominent Enaleni BEE consortiums
4.1 The final 12 Enaleni BEE groupings that comprise the outside BEE
parties, were carefully selected to ensure that the groups are aligned
with the objectives of Enaleni and that the groups who participate:
- are truly broad-based;
- include women"s" groupings;
- have significant experience in the wider health care industry;
and
- can contribute meaningful to Enaleni on a strategic and
operational level to ensure the continued success and growth of
the Enaleni group.
4.2 Amabubesi Healthcare (Pty) Limited, which is lead by Dr Gil Mahlati is
one of the leading BEE consortiums and is also a prominent player in
the healthcare industry. The group has expertise in both the public,
as well as private sectors and has various healthcare investments
complementary to Enaleni"s business.
4.3 The Inala Consortium, lead by Bongani Mlambo is a group that is
involved in medical aid administration and is the owner of various
pharmacies. The Inala Consortium includes healthcare professionals
with both retail and Government experience.
4.4 The Yonga Consortium, lead by Bongani Caga includes DENOSA amongst its
members, being the largest nursing organisation in Africa representing
the interests of 80 000 nurses and midwifery professionals in South
Africa.
4.5 Safika Investments (Pty) Limited ("Safika") was formed by Safika
Holdings (Pty) Limited in 2005, as a vehicle to invest in private
equity transactions with specific emphasis on companies requiring BEE
partners. Safika invests in businesses with clear value add
opportunities to enhance the strategic and transformational
imperatives of established businesses.
4.6 The New Era Consortium and the Laxmi Group Limited are companies,
which are involved in local and international packaging for
pharmaceutical and consumer care products. New Era is part of the
Golden Era Group (Pty) Limited, the only triple A Empowerment company
in South Africa.
4.7 Two Ships Trading 237 (Pty) Limited, lead by Dr Aubrey Mokoape is a
Durban based group, with significant experience of the health care
industry, and in decision making on a governmental, parastatal and
business level. The group has strong relations in the neighbouring
countries and will assist Enaleni with exports into SADC regions.
4.8 Aquarella Investments 54 (Pty) Limited, a consortium of local and
international healthcare and pharmaceutical parties with experience
and international links for dossiers and Active Pharmaceutical
Ingredients.
4.9 Koketso Growth (Pty) Limited ("Koketso") is lead by Dali Tambo, Non-
Executive Director of Enaleni, and Mandla Langa. Koketso has a number
of investments ranging from the healthcare sector to hygiene. Koketso
was one of the first BEE Groups to become a shareholder in Enaleni and
it is increasing its shareholding in Enaleni in line with its optimism
regarding the company"s future.
4.10 Other BEE investor groupings include black health professional
networks and prominent black business people such as Thembisa Dingaan,
Dr Bobby Ramasia, S"bu Luthuli and Mbali Ngqula.
4.11 No shareholder listed above will have an ultimate shareholding of more
than 5% in Enaleni.
5. BEE Consortium Directors
One of the conditions of the transaction is that 3 non-executive directors
must be appointed to the Board of Enaleni by the BEE consortiums and the
IDC within six months after the successful implementation of the Cipla
Medpro transaction. Nominations have been made and will be made public
once the Enaleni board has approved the new candidates.
6. Conclusion
The Enaleni BEE consortium will together hold a 20.35% shareholding in
Enaleni. The board of Enaleni believes that the Enaleni BEE transaction
will be positive for future development of Enaleni"s business. The Board
also welcomes the new Enaleni BEE consortium shareholders and look forward
to their active participation and positive contribution to the Enaleni
business.
Sponsor and Lead BEE Arranger
Exchange Sponsors
Investment Bank
Nedbank Capital
Attorneys
Deneys Reitz Inc.
Independent Advisor to the BEE Consortiums
BEExchange Advisors
Johannesburg
20 February 2006
Date: 20/02/2006 05:32:04 PM Produced by the JSE SENS Department
