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PAC
PAC
PAC - Pacific Holdings Limited - Disposal of the Cape Rendezvous Hotel
Pacific Holdings Limited
Incorporated in the Republic of South Africa
Registration number 1987/001960/06
Share code: PAC & ISIN: ZAE000027462
("Pacific" or "the company")
Disposal of the Cape Rendezvous Hotel
1. Introduction
Shareholders are hereby notified that Cape Rendezvous Hotel (Pty) Limited ("the
seller"), a wholly-owned subsidiary of Pacific, has entered into an agreement
dated 28 September 2006 ("the agreement") with Asands (Pty) Limited ("the
purchaser"), for the disposal of the Cape Rendezvous Hotel ("the disposal"), a
hotel owned and operated by Pacific.
2. Section 228 disposal
The Cape Rendezvous Hotel is the company`s only remaining asset. The disposal
therefore constitutes a section 228 disposal in terms of the Companies Act (Act
61 of 1973), as amended, and is governed by the rules of the Securities
Regulation Code on Take-overs and Mergers. The disposal, in addition to
requiring shareholder approval, therefore requires an opinion from an
independent professional expert as to the fairness and reasonableness thereof.
Bridge Capital Advisors (Pty) Limited has been appointed and its opinion will be
disclosed in a circular to be issued to shareholders.
3. Terms of the disposal
Pacific will dispose of the hotel "voetstoots" to the purchaser for an amount of
R20 million ("the disposal consideration"), payable in cash on the date of
registration of transfer of the property into the name of the purchaser.
The disposal is subject to the fulfilment of the following conditions precedent:
approval by the JSE Limited ("the JSE"); and
approval of the disposal by the shareholders of Pacific in general
meeting.
4. Rationale for the disposal and future prospects
The company and group experienced adverse trading conditions over the last
number of years and as a result of this the company`s liabilities exceed its
assets. The directors received a market-related offer for the hotel and are of
the opinion that the disposal consideration is adequate to settle any debt owing
to third parties.
Following the disposal and the receipt of the disposal consideration, the
company plans to repay debt amounting to approximately R17 million owing to
Pacific Asia Investments International Limited, the company`s controlling
shareholder, and Mycom SA (Pty) Limited, a company controlled by the ultimate
parent company of Pacific, Mycom Berhard. Following the disposal, the company
will have no assets and will either, subject to the requisite shareholder
approval, proceed with an orderly winding-up or pursue other prospects.
Shareholders will be notified of any decisions taken in this regard.
5. Financial effects of the disposal
Set out in the table below are the unaudited pro forma financial effects of the
disposal based on Pacific`s audited results for the year ended 30 June 2006.
The unaudited pro forma financial effects are prepared for illustrative purposes
only to provide information on how the disposal may have impacted on the results
and financial position of Pacific and because of their nature may not give a
fair reflection of Pacific`s financial position after the disposal nor the
effect on future earnings. The unaudited pro forma financial effects are the
responsibility of the company`s directors.
Before the After the Percentage
Notes disposal(1) disposal change
Earnings per share (cents) 2 15.24 99.55 553.22
Headline loss per share
(cents) 2 (0.35) - (100.00)
Net asset value and
tangible net asset value
(R`000) (11 573) 1 901 116.43
Net asset value and
tangible net
asset value per share
(cents) 3 (71.9) 11.81 (83.74)
Net book value of the
property (R`000) 5 725 - (100.00)
Number of shares in
issue (`000) 16 095 16 095 -
Weighted number of
shares in issue (`000) 16 095 16 095 -
Notes:
1. Extracted from the audited results of Pacific for the year ended 30 June
2006.
2. Earnings and headline loss per share are based on the following assumptions:
the disposal was effected on 1 July 2005;
transaction costs of R451 000;
all trade has ceased as a result of the disposal;
an interest saving on the net disposal consideration;
the full capital gain will be subject to Capital Gains Tax; and
no adjustment was made for property rates as this saving is immaterial.
3. Net asset value and tangible net asset value per share are based on the
following assumptions:
the disposal was effected on 30 June 2006; and
transaction costs of R451 000.
6. Documentation
A circular, which is subject to the approval of the JSE and the Securities
Regulation Panel, will be sent to shareholders in due course. The circular will
contain details of the disposal and will incorporate a notice of general meeting
to Pacific shareholders.
Johannesburg
5 February 2007
Transaction sponsor and independent professional expert
Bridge Capital
Reporting accountants and auditors
KPMG
Date: 05/02/2007 13:42:01 Produced by the JSE SENS Department.
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