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SBG
SBG
SBG - Simeka BSG - Variation to the Terms of Acquisition: Waymark Consulting
Simeka BSG Limited
(Incorporated in the Republic of South Africa)
(Registration No. 2003/012583/06)
(formerly Xantium Technology Holdings Limited)
Share code: SBG & ISIN code: ZAE000074878
("Simeka BSG" or "the company")
VARIATION TO THE TERMS OF ACQUISITION: WAYMARK CONSULTING
Shareholders are referred to prior announcements regarding the company`s
acquisition of the entire issued share capital of Waymark Consulting
(Proprietary) Limited ("Waymark Consulting"), particularly those of 17 August
2006, 21 November 2005 and 3 October 2005.
The company agreed to a variation and acceleration of the balance of the
purchase price outstanding in respect of its acquisition of Waymark Consulting.
This was agreed in order to accommodate implementation and integration of the
acquisition in a manner considered by the board to be in the best interests of
the company.
The variation and acceleration relates to payments that would have fallen due to
the Waymark Consulting vendors on and after 31 August 2006 (the "remaining
payments"), all payments due prior to that date having being discharged by the
company. In this regard, the remaining payments comprised in aggregate:
- R8,946,750 in cash (comprising R4 773 375 payable at 31 August 2006, R1,2
million payable in twelve equal monthly instalments of R100 000 from 1
January 2007, R1 486 687 payable at 31 August 2007 and R1 486 688 payable
at 31 August 2008); and
- the delivery of 8 461 500 Simeka BSG shares (comprising 4 230 750 shares
issued at 65 cents per share at 31 August 2006, 2 115 375 shares issued at
70 cents per share at 31 August 2007 and 2 115 375 shares issued at 75
cents per share at 31 August 2008).
The accelerated settlement comprised an immediate, once-off cash payment of R13
million.
With effect from 1 March 2005 Simeka BSG acquired 51% of the shares in Waymark
Consulting. With effect from 1 September 2005 the company acquired the remaining
49% of Waymark Consulting. This was a related party transaction in terms of the
Listings Requirements of the JSE, for which the approval of shareholders was
obtained. As such, the JSE has ruled that the above variations are subject to
the approval of a majority of shareholders. In accordance with the ruling of the
JSE, a resolution seeking the necessary approval will be proposed at the annual
general meeting of shareholders, to be held during September or October 2007.
The company has secured irrevocable undertakings from a majority of its
shareholders that they will support this resolution.
The revised pro forma financial effects of the Waymark Consulting acquisition
set out in the table below are the responsibility of the company`s directors and
have been prepared for illustrative purposes only, to show how the terms of the
Waymark Consulting acquisition, varied as described above, may have affected
Simeka BSG`s results for the six months ended 30 November 2006. Because of
their nature, the pro forma financial effects may not fairly reflect Simeka
BSG`s financial position.
Pre the Post the Percentage
variation variation Change
Headline earnings per
share (cents)
-Weighted in issue 5.8 6.2 6.9%
-Weighted in issue and to 5.6 6.1 8.9%
be issued
Adjusted headline
earnings per share
(cents)
-Weighted in issue 6.0 6.4 6.7%
-Weighted in issue and to 5.8 6.3 8.6%
be issued
Earnings per share
(cents)
-Weighted in issue 5.8 6.2 6.9%
-Weighted in issue and to 5.6 6.1 8.9%
be issued
Notes:
- The "Pre the variation" column reflects what the headline earnings per
share, adjusted headline earnings per share and earnings per share for
the six months ended 30 November 2006 would have been had the
variation to the terms of the Waymark Consulting acquisition not taken
place, and is based on the following assumptions:
- that the variation was effective 1 June 2006;
- that there were 356 333 000 weighted shares in issue for the
period; and
- that there were 365 964 000 weighted shares in issue and to be
issued for the period;
- The "Post the variation" column reflects headline earnings per share,
adjusted headline earnings per share and earnings per share as
disclosed in Simeka BSG`s results for the six months ended 30 November
2006, which have taken into account the effects of the variation to
the terms of the Waymark Consulting acquisition;
- The effect of the variation to the terms of the Waymark Consulting
acquisition on net asset value per share and net tangible asset value
per share at 30 November 2006 is immaterial.
Rosebank
27 February 2007
Designated advisor to Simeka BSG Limited
Java Capital (Proprietary) Limited
Date: 28/02/2007 12:39:00 Produced by the JSE SENS Department.
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