| Thu 6 Apr 2006, 8:15 | | Prism Holdings Limited - Scheme Of Arrangement - N |
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PIM
PIM
Prism Holdings Limited - Scheme Of Arrangement - Net1 Cash Offer To Acquire
Entire Issued Share Capital Of Prism
Prism Holdings Limited
(Incorporated in the Republic of South Africa)
Registration number 1998/018949/06
Share code: PIM
ISIN: ZAE000022257
("Prism")
SCHEME OF ARRANGEMENT - NET1 CASH OFFER TO ACQUIRE ENTIRE ISSUED SHARE CAPITAL
OF PRISM
1. INTRODUCTION
Prism shareholders are referred to the announcement dated 3 March 2006, in which
shareholders were advised that Net1 Applied Technologies South Africa Limited
("Net1") had submitted to the board of directors of Prism ("the Prism board") a
notice of Net1"s firm intention to make an offer to acquire all of Prism"s
issued share capital for a cash consideration of R1,16 per Prism share ("the
Net1 offer").
The Net1 offer is to be implemented by way of a scheme of arrangement ("the
scheme") in terms of s311 of the Companies Act 61 of 1973, as amended ("the
Act").
2. APPLICATION TO BE MADE TO HIGH COURT TO AUTHORISE THE CONVENING OF THE
SCHEME MEETING
Shareholders are advised that application will be made to the High Court of
South Africa (Witwatersrand Local Division) on Tuesday, 11 April 2006 for an
order granting Prism leave to convene a scheme meeting, to be held at 10:00 on
Monday 8 May 2006 (or such other date as the Court may determine) ("the scheme
meeting") at the registered office of Prism, situated at Building 1, Prism
Business Park, Ruby Close, Fourways, Sandton, for the purpose of considering
and, if deemed fit, approving the scheme, with or without modification.
3. PRO FORMA FINANCIAL EFFECTS
The pro forma financial effects of the scheme on Prism shareholders set out
below are based on the published, unaudited financial information of Prism for
the six months ended 31 December 2005. The pro forma financial effects have been
reviewed by PricewaterhouseCoopers Inc., the independent reporting accountants
to Prism.
The pro forma financial effects have been prepared for illustrative purposes
only, to provide information about how the scheme might have affected a Prism
shareholder and, because of its nature, may not give a true reflection of a
Prism shareholder"s financial position. The Prism board is responsible for the
pro forma financial effects.
The pro forma financial effects have been reported on by PricewaterhouseCoopers
Inc., the independent reporting accountants to Prism.
Before the After the Change
scheme scheme
(cents) (cents) (%)
Earnings per share (1) 2.5 2.8 12
Headline earnings per 2.5 2.8 12
share(1)
Net asset value per 18.6 116.0 524
share(2)
Market value per share 80.0 116.0 45
(8 February 2006) (3)
/scheme consideration
Market value per share 111.0 116.0 4.5
(4 April 2006) (4)
/scheme consideration
Notes
(1) The "Before" column is based on Prism"s interim
results for the six months ended 31 December 2005.
The "After" column reflects the after tax interest
income that a shareholder would have earned on the
scheme consideration for the six months ended 31
December 2005, assuming a tax rate of 29% and an after-
tax interest rate of 4.9%, being the average rate of
interest earned on call deposit for the six-month
period ended 31 December 2005.
(2) The "Before" column reflects the net asset value per
share as reported at 31 December 2005. The "After"
reflects the scheme consideration.
(3) The "Before" column reflects the closing price of a
share on the JSE on 8 February 2006, being the day
immediately preceding the date of the first cautionary
announcement providing details of the scheme. The
"After" column reflects the scheme consideration.
(4) The "Before" column reflects the closing price of a
share on the JSE on 4 April 2006,being the last
practical date prior to the date of publication of
this announcement. The "After" column reflects the
scheme consideration.
4. OPINIONS AND RECOMMENDATIONS
The independent sub-committee of the Prism board has appointed
PricewaterhouseCoopers Corporate Finance (Proprietary) Limited ("PWC") as the
independent financial advisor to Prism. PWC has expressed to the Prism board
its opinion that the terms and conditions of the scheme are fair and reasonable
to Prism shareholders.
The Prism board has considered the terms and conditions of the scheme, as well
as the opinion of PWC, and is of the unanimous opinion that the terms and
conditions of the scheme are fair and reasonable to Prism shareholders.
Accordingly, the Prism board recommends that Prism shareholders vote in favour
of the scheme. The directors of Prism who hold Prism shares intend voting in
favour of the scheme in respect of their shares.
5. CONDITIONS TO THE SCHEME
Consequent upon an agreement concluded between Prism and Net1, Net1 has
expedited the completion of its due diligence investigation in respect of Prism.
The due diligence investigation has been completed to the satisfaction of Net1.
Accordingly, the scheme will no longer be conditional on any further due
diligence process.
The scheme will be subject to fulfilment of the following conditions precedent:
5.1. the approval of the transaction by the South African competition
authorities ("the Competition Authorities");
5.2. Net1 not becoming aware prior to the approval of the scheme at the scheme
meeting of any adverse effect, fact or circumstance impacting on the Prism
business which is material with regard to the present business, or to the
continued existence, assets, revenues or financial position of Prism;
5.3. the scheme being approved by a majority representing not less than 75% of
the votes exercisable by the scheme members present and voting either in person
or by proxy, at the scheme meeting, provided that scheme members holding at
least 51% of the entire issued share capital of Prism are present and vote
either in person or by proxy, at the scheme meeting in favour of the scheme;
5.4. the scheme being sanctioned by the High Court of South Africa
(Witwatersrand Local Division);
5.5. a certified copy of the Order of Court sanctioning the scheme being
registered by the Registrar of Companies ("the Registrar") in terms of the Act;
and
5.6. the unconditional approval of the JSE Limited ("JSE"), the Securities
Regulation Panel and any other regulatory authorities to the extent required.
The scheme remains subject to the resolutive condition that no competing offer
or bid is received by the Prism board or made by a third party prior to the
implementation of the scheme which would result in Prism shareholders who have
furnished written undertakings to support the scheme being entitled to withdraw
(and in fact withdrawing) such undertakings so that, as a result, Prism
shareholders holding less than 40% of the issued share capital of Prism remain
bound to support the scheme. This resolutive condition has been stipulated for
the benefit of Net1 and may be waived by Net1 at any time.
6. SALIENT DATES AND TIMES
Once the High Court of South Africa has granted Prism authority to convene the
scheme meeting, a further announcement will be published setting out the salient
dates and times for the scheme.
7. POSTING OF CIRCULAR
A circular containing full details of the Net1 offer, including the scheme
documentation, is expected to be posted to Prism shareholders on or about
Thursday, 13 April 2006.
8. FURTHER ANNOUNCEMENTS
Further announcements pertaining to the Net1 offer will be published on SENS and
in the press in due course.
Fourways
5 April 2006
Corporate advisor, legal advisor and transaction sponsor to Prism
Java Capital (Proprietary) Limited
Sponsor to Prism
Standard Bank
Independent financial advisor to Prism
PricewaterhouseCoopers Corporate Finance (Pty) Ltd
Reporting accountants to Prism
PricewaterhouseCoopers Inc.
Date: 06/04/2006 08:15:26 AM Produced by the JSE SENS Department
