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MVG MVGP
MVG
Mvela Group - Acquisition
Mvelaphanda Group Limited
(Incorporated in the Republic of South Africa)
Registration number 1995/004153/06
Ordinary share code: MVG
Preference share code: MVGP
Ordinary share: ISIN: ZAE000060737
Preference share: ISIN: ZAE000073540
("Mvela Group" or "the company")
Acquisition of a further 5.61% effective economic interest in Life
Healthcare Group Holdings (Proprietary) Limited ("Life Healthcare")
Mvela Group is pleased to announce that it has, in conjunction with certain
of the existing shareholders in Life Healthcare, namely Brimstone
Investment Corporation Limited, Old Mutual Life Assurance Company (South
Africa) Limited, various entities in the First Rand Group, and certain of
the senior management of Life Healthcare (collectively "the Life
shareholders"), concluded a written agreement dated 6 September 2006 ("the
sale agreement") with African Oxygen Limited ("Afrox") in terms of which
the Life shareholders have, pursuant to the exercise of an existing option,
acquired the 21.39% effective economic interest ("the sale interest") in
Life Healthcare owned by Afrox. The purchase price payable by the Life
Shareholders for the sale interest is R850 million.
Pursuant to the sale agreement, Mvela Group will acquire an additional
5.61% effective economic interest in Life Healthcare for a purchase price
of R223 million ("the Life Healthcare acquisition"). The purchase price of
R223 million is payable in cash on 29 September 2006 and will be funded
from Mvela Group"s existing cash resources. Depending on the outcome of
certain other transactions which Life Healthcare is currently considering,
the 5.61% effective economic interest to be acquired by Mvela Group may be
reduced to an effective economic interest of 4.43%, with a corresponding
reduction in the purchase price payable by Mvela Group.
Mvela Group currently holds an 18.1% effective economic interest
(equivalent to a 20.3% effective voting interest) in Life Healthcare, which
effective economic interest will increase to 23.7% following the Life
Healthcare acquisition. Mvela Group regards Life Healthcare as a strategic
investment with substantial growth potential. The Life Healthcare
acquisition is a unique opportunity for Mvela Group to exercise its
existing rights to increase its effective interest in Life Healthcare at an
attractive discount of 37% to the Mvela Group directors" current
valuation of the sale interests (calculated with reference to Mvela Group"s
valuation of its 18.1% effective economic interest in Life Healthcare, as
disclosed in Mvela Group"s reviewed results for the year ended 30 June 2006
which were released on SENS on 5 September 2006 ("the June 2006 results")).
Had the Life Healthcare acquisition been concluded on 30 June 2006, this
would have resulted in an increase in Mvela Group"s intrinsic net asset
value per ordinary share at 30 June 2006 from R11.77 to R12.00, and an
increase in Mvela Group"s intrinsic net asset value per ordinary share at 1
September 2006 (as disclosed in the June 2006 results) from R12.05 to
R12.28.
Sandton
7 September 2006
Sponsor
Deutsche Securities SA (Proprietary) Limited
Attorneys
Bowman Gilfillan Inc.
Date: 07/09/2006 12:57:05 PM Produced by the JSE SENS Department
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