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ENL
ENL
ENL - Enaleni - The acquisition of the remaining shares in Bioharmony
(Proprietary) Limited ("Bioharmony")
Enaleni Pharmaceuticals Limited
(Incorporated in the Republic of South Africa)
(Registration number 2002/018027/06)
(JSE code: ENL & ISIN: ZAE000067740)
("Enaleni")
ANNOUNCEMENT REGARDING THE ACQUISITION OF THE REMAINING SHARES IN
BIOHARMONY (PROPRIETARY) LIMITED ("Bioharmony")
1. Introduction
Shareholders are advised that Enaleni has entered into an agreement dated 4
August 2006 ("the agreement") to acquire the remaining 49% of the issued
shares and loan accounts of Bioharmony, from Ms. Maria Ascencao ("the
acquisition"). The effective date of the acquisition was 1 July 2006.
2. Rationale for the acquisition
Enaleni has a well devised strategy to target fast growing businesses in
the vitality and wellness market, which is growing rapidly and worth in
excess of R3 billion in South Africa. As a result Enaleni acquired 51% of
Bioharmony in May 2005. Given the successful revenue growth of the business
and the exciting prospects for the brand, Enaleni decided to acquire the
remaining shares in Bioharmony. Enaleni expects to extract further
synergies via the integration of Bioharmony.
Ms. Maria Ascencao has extended her employment contract and is now a more
significant shareholder in the Enaleni Group. The transaction fits in well
with Enaleni`s strategy of, once a joint venture business has started
performing well and aligned itself strategically with the Group, to then
provide the previous owner of the business the opportunity to effectively
switch their shares for a share in the Enaleni Group, allowing Enaleni to
become the sole shareholder of the company.
3. Consideration for the acquisition
The consideration for the acquisition is R6 million, of which R4 million is
payable in cash, with the remainder of the consideration being settled by
the issue of 524 843 Enaleni shares (the "consideration shares"). In terms
of the agreement the consideration shares shall be issued at R3.81 per
share, being the volume weighted average price of Enaleni`s shares on the
JSE for the thirty days ended 3 August 2006.
4. Financial effects of the disposal
The acquisition will not have a material effect on Enaleni`s earnings per
share, headline earnings per share, net asset value or tangible net asset
value per share. However, it is expected that Bioharmony may become a
significant contributor to the Enaleni Group in future years.
5. Conditions precedent
All conditions precedent relating to the acquisition have been fulfilled.
6. Related party transaction
As Ms. Maria Ascencao is a material shareholder of a subsidiary of Enaleni,
the disposal is a "small related party transaction" in terms of the JSE
Limited Listings Requirements.
Enaleni therefore appointed Ernst & Young ("E&Y") as an independent
professional expert to review the terms and conditions of the acquisition.
E&Y has reviewed the terms and conditions of the acquisition and is of the
opinion that these terms and conditions are fair and reasonable to Enaleni
shareholders. E&Y has expressed this opinion in writing and such opinion
will be available for inspection at Enaleni`s registered office, for a
period of 28 days from 1 February 2007.
Durban
9 February 2007
Sponsor
Nedbank Capital
Independent professional expert
Ernst & Young
Date: 09/02/2007 12:44:01 Produced by the JSE SENS Department.
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