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GOLD EDGE HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1997/021085/06)
("Gold Edge" or "the company")
JSE Code GLE: ISIN ZAE000016515
REVERSE LISTING OF IXIA TRADING 532 (PROPRIETARY) LIMITED ("IXIA") AND FURTHER
CAUTIONARY ANNOUNCEMENT
1. Introduction
In an announcement dated 8 April 2003, shareholders were informed that, subject
to certain suspensive conditions, agreement had been reached for the company to
acquire 100% of the issued share capital of Ixia. This will amount to a reverse
takeover of the company by the shareholders of Ixia. This announcement contains
further information regarding the transaction.
Rationale for the transaction
In terms of the agreement, the assets of Ixia will comprise retail, commercial
and industrial properties acquired for approximately R480 million with further
terms as set out below ("the new portfolio"). The acquisition of Ixia will thus
be in line with the company"s policy of expanding the portfolio to a meaningful
size.
The new portfolio
In terms of the agreement, the new portfolio will be acquired by Ixia in a
number of phases, the first of which consists of 31 properties and has a value
of approximately R180 million ("Phase 1") of which R86 million will come from
Bonatla Property Holdings Limited ("Bonatla"). It is the intention of the
parties to implement Phase 2 of the agreement by no later than six months after
the signature date of the agreement, which date is 2 April 2003 ("the agreement
date"). The new portfolio will be acquired on a net pre-interest yield of
approximately 14.5% with escalations of 8% compounded annually. The properties
will be of various types and grades. Bond related finance will not exceed 60%
of the acquisition value of the properties and will have a term of at least five
years to run from the agreement date. Following the approval of the acquisition
of Phase 1, it is intended to change the company"s name to reflect its new
identity.
Terms of the acquisition
In addition to the description of the new portfolio set out above, the agreement
contains the following terms and conditions:
1. the agreement is subject to regulatory authority approval and the
approval of Gold Edge shareholders voting in general meeting;
2. the share capital of Gold Edge will be converted into linked units
consisting of shares and loan stock;
3. Gold Edge will issue linked units to the shareholders of Ixia,
calculated at a value of R2.00 per linked unit;
4. Ixia will procure the release of the personal sureties on one of the
properties already owned by Gold Edge within 60 days of the agreement date;
5. Ixia"s due diligence on Gold Edge has been completed;
6. the first phase of the new portfolio acquisition will be immediately
purchased by the company;
7. Messrs M Mitchley and GJ van Zyl will resign as directors once the
conditions precedent have been fulfilled;
8. the company"s shares will be consolidated on the basis of 24.3 (not 25
as previously announced) new linked units for every 100 existing shares, which
will mean that the existing holders of Gold Edge shares will collectively hold 9
116 926 linked units in the company;
9. the value to be placed on the linked units for the purposes of the
acquisition is R2.00;
10. the acquisition of a part of the new portfolio by Ixia is subject to the
approval of Fairvest and Bonatla shareholders; and
11. the number of linked units to be issued for the acquisition and the
financial effects of the transaction cannot be determined accurately at this
stage as they depend on the outcome of certain negotiations concerning financing
arrangements.
Financial effects of the transaction and further cautionary
Financial effects cannot yet be calculated for the reason given in paragraph 11
but will be communicated to shareholders as soon as they are available.
Shareholders are advised to continue to exercise caution when dealing in the
company"s shares until the financial effects have been made known.
Opinions
Each of the elements of Phase 1 is a related party transaction and will be
subject to a fair and reasonable report by an independent financial adviser.
Other matters
The vendors of Ixia are Bateleur Finance (Proprietary) Limited ("Bateleur"). In
terms of the agreement between Ixia and Bonatla, details of which appear in a
separate announcement by Bonatla ("the Bonatla announcement"), R14 million of
Gold Edge linked units to be issued in terms of the agreement, will be
indirectly used by Ixia to partly fund the purchase of certain properties from
Bonatla. A further, as yet undetermined, number of Gold Edge linked units to be
issued in terms of the agreement, are intended to be indirectly used by Ixia to
partly fund the purchase of certain properties from Fairvest Property Holdings
Limited which are in the course of negotiation. Once the agreement has been
fully implemented, there will be no controlling shareholder in Gold Edge.
Circular
A circular containing full details of the acquisition is in the course of
preparation and will be posted to shareholders as soon as it is available.
Sandton
13 May 2003
Transaction Sponsor
Sponsor to Gold Edge
LPC Manhattan
Bridge Capital
Date: 15/05/2003 07:01:12 AM Supplied by www.sharenet.co.za
Produced by the JSE SENS Department
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