| Fri 31 Mar 2006, 14:45 | | Zaptronix - BEE transaction and transfer to AltX |
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ZPT
ZPT
Zaptronix - BEE transaction and transfer to AltX
ZAPTRONIX LIMITED
(Incorporated in the Republic of South Africa)
(Registration number: 1997/014928/06)
Share code: ZPT & ISIN: ZAE000070934
("Zaptronix" or "the Company")
Conclusion of an Empowerment transaction with Royal Bafokeng Capital (Pty) Ltd,
transfer to AltX and Withdrawal of Cautionary
1. BEE transaction
Introduction
Further to the cautionary announcement published on 1 February 2006, the board
of directors of Zaptronix is pleased to announce that, subject to the conditions
precedent set out in 1.4 below, it has entered into a transaction with Royal
Bafokeng Capital (Proprietary) Ltd ("RBC") resulting in 30% of the existing
issued ordinary share capital in the Company being owned by RBC.
RBC is a black economic empowered ("BEE") company, being 50.1% owned by Royal
Bafokeng Finance (Pty) Ltd, an investment vehicle of the Royal Bafokeng Nation.
The remaining 49.9% of the shares in RBC is held by Strider Holdings (Pty) Ltd
("Strider"), the current controlling shareholder of Zaptronix.
RBC will appoint two directors to the board of Zaptronix, and will assist in the
development of Zaptronix in terms of its acquisition and growth strategy.
The BEE transaction has no immediate dilution effect on existing Zaptronix
shareholders, as it requires no immediate issue of new Zaptronix shares.
Instead, the BEE transaction is being facilitated by Strider by the transfer 113
795 700 Zaptronix ordinary shares to RBC at a price of 16 cents per share.
As part of the BEE transaction, Zaptronix granted RBC the right to subscribe in
future for a maximum of 113 795 700 new Zaptronix shares at 16 cents per share
("the BEE option"), as set out in more detail in 1.3 below.
Rationale
The board regards the transaction as a milestone event in the Company"s history
and is excited about the benefits that the involvement of, and association with,
the Royal Bafokeng Capital will bring. The transaction is viewed as a crucial
step in positioning the Company for future organic and acquisitive growth:
* The BEE status places the group in a favourable position to secure future
private corporate and governmental business where BEE supplier status is a
prerequisite. Both the existing business channels, namely Energy Management
Services ("EMS") and Mobile Logistics Management Services ("MLMS"), operate in
environments where potential benefits are significant.
* The BEE status will further strengthen Zaptronix" hand as an acquirer of
businesses. The MLMS business was already added to the group through the
successful acquisition of DuO SP Ltd in September 2005.
* The BEE status of the group has been achieved without any immediate dilution
of existing shareholders. In addition, the sustainability of the group"s BEE
status will be ensured by the granting of the BEE option as set out in 1.3
below.
Terms and conditions of the BEE option
In terms of the option agreement entered into between Zaptronix and RBC, RBC
will have the right, for a period not exceeding three years from the date of
approval of the BEE option by Zaptronix shareholders ("the option period"), to
subscribe for a maximum of 113 795 700 new ordinary shares in Zaptronix at 16
cents per share. The number of shares equates to 30% of the Company"s existing
issued ordinary shares at the date of this announcement. RBC will only be
entitled to exercise its options each time Zaptronix issues shares during the
option period in terms of either any general issue of shares for cash or in
terms of an acquisition. The number of shares that RBC are entitled to subscribe
for will be 30% of the shares being issued and will result in RBC, if taken up,
maintaining a 30% shareholding in Zaptronix. .
Other salient features of the BEE option include:
* RBC will have the right to renounce any of its options in favour of Strider;
* RBC has the obligation of ensuring that Zaptronix, at all times during the
option period, maintains its BEE status resulting from the shareholding by RBC.
Should RBC cause the Company"s BEE status to be adversely affected in any way
the BEE option will expire.
Suspensive conditions to the BEE transaction
The BEE transaction is conditional upon:
The approval of the BEE option by Zaptronix shareholders in general meeting; and
Obtaining the necessary regulatory approvals, including approval of the BEE
option by the JSE Limited ("JSE").
Classification of the BEE transaction and the BEE option, financial effects and
documentation required
The BEE transaction does not result in a change in control of Zaptronix or an
affected transaction as contemplated by the Securities Regulation Code on
Takeovers and Mergers as Strider and RBC will be parties acting in concert.
The BEE option is defined as a related party transaction in terms of the JSE
Listings Requirements as a result of the shareholding of Strider in RBC. As
such, the minority shareholders of Zaptronix will be required to approve the
transaction in a general meeting and a fair and reasonable opinion by an
independent professional expert acceptable to the JSE will be included in the
circular to shareholders setting out the full details of the BEE option. This
circular, including a notice to convene a general meeting of shareholders, will
be posted as soon as possible.
As the BEE option can only be exercised by RBC upon an event under the control
of the board of Zaptronix (i.e. a general issue of shares for cash or an
acquisition issue) the BEE option has no immediate dilutionary impact or effect
on the financial results of the Company.
2. Transfer to the Alternative Exchange of the JSE ("AltX")
The board is pleased to announce that the AltX Advisory Committee has
recommended to the JSE that it approves the transfer the Company"s listing to
AltX. A formal application will shortly be made by Zaptronix to the JSE in this
regard, following which an announcement containing further details, including
the date on which Zaptronix securities will commence trading on AltX, will be
published.
3. Withdrawal of cautionary
As the transaction described in paragraph 1 has been announced, shareholders are
advised that caution is no longer required to be exercised when dealing in the
Company"s securities.
Midrand
31 March 2006
Sasfin Capital
(A division of Sasfin Bank Ltd)
SPONSOR AND CORPORATE ADVISOR
Radagast Capital (Pty) Ltd
TRANSACTION ADVISOR
Date: 31/03/2006 02:45:16 PM Produced by the JSE SENS Department
