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Rlf - Rolfes - Additional Resin Plant And Manufacturing Agreement

Release Date: 26/09/2007 16:30:01      Code(s): RLF
RLF - Rolfes - Additional resin plant and manufacturing agreement               
ROLFES TECHNOLOGY HOLDINGS LIMITED                                              
(Registration number 2000/002715/06)                                            
Share Code: RLF                                                                 
ISIN:ZAE000096202                                                               
("Rolfes" or "the Group")                                                       
www.rolfesza.com                                                                
ADDITIONAL RESIN PLANT AND MANUFACTURING AGREEMENT                              
Introduction                                                                    
Rolfes Chemicals (Pty) Limited, a subsidiary of Rolfes, has secured a second    
resin plant, situated in Durban, from Paintchem (Pty) Limited ("Paintchem"),    
effective 1 November 2007.  Rolfes has also signed a long term product supply   
agreement with Paintchem.                                                       
Rationale for transaction and key terms                                         
Rolfes secured the Paintchem resin plant by way of a lease agreement for 5      
years, with an option to renew for a further 5 years.  Rolfes also has an option
to an outright purchase of the plant in the event that Paintchem wish to dispose
of it.  The agreement is further subject to conditions normal to a transaction  
of this nature.  Other than a monthly lease payment, Rolfes has made no upfront 
capital payment in respect of the new resin plant facilities                    
Rolfes has signed a long term supply agreement with Paintchem, in terms of which
Rolfes will manufacture certain hydroxyl acrylic and other resin products for   
Paintchem on a cost plus margin basis.  In terms of the supply agreement,       
Paintchem guarantees a minimum quantity of product offtake from Rolfes per      
annum, which quantity equates to up to 40% of the total plant capacity.  The    
remaining plant capacity will be used to manufacture alkyd, hydroxy and         
woodfinish resin products for Rolfes` larger Durban based clients.              
The transaction not only more than doubles the resin making capacity of Rolfes  
but also provides the Group with a strategic foothold in the large and lucrative
Kwazulu-Natal market.  The transaction will free up to 60% of the Alberton plant
capacity, which capacity will be used to further grow the resin business in the 
Gauteng and adjacent areas.                                                     
Midrand                                                                         
26 September 2007                                                               
Registered office:                                                              
The Summit                                                                      
269 16th Road                                                                   
Randjiespark                                                                    
Midrand                                                                         
Executive Directors                          Non-Executive Directors            
E van der Merwe(Chief Executive Officer)     BT Ngcuka (Chairman)               
AJ Greeff (Financial Director)               AJ Fourie                          
                                            L Dyosi                             
Designated advisor                                                              
PSG Capital (Pty) Limited                                                       
Date: 26/09/2007 16:30:01 Supplied by www.sharenet.co.za                     
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