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RLF - Rolfes Technology Holdings - Acquisition of Leatherchem (Pty) Ltd and

Release Date: 28/11/2007 10:36:38      Code(s): RLF
RLF - Rolfes Technology Holdings - Acquisition of Leatherchem (Pty) Ltd and     
                                  further cautionary                            
ROLFES TECHNOLOGY HOLDINGS LIMITED                                              
(Registration Number 2002/002715/06)                                            
Share code:  RLF      ISIN:  ZAE000096202                                       
("Rolfes" or "the company")                                                     
Rolfes is pleased to announce that the company has entered into a sale agreement
with Leatherchem (Proprietary) Limited ("Leatherchem") on Thursday,             
22 November 2007 in terms of which Rolfes purchased the entire issued share     
capital in and claims against Leatherchem ("the transaction").                  
Background to Leatherchem                                                       
Leatherchem is a niche pigment pastes, dyes and colorant dispersions            
manufacturer focusing on products in the leather, plastisol, vinyls, polyester  
and ink industries.  The company uses state of the art technology and equipment,
has been in existence for more than 20 years and is based in Cape Town.  The    
company distributes its products primarily in the coastal regions of South      
Rationale for transaction                                                       
Rolfes has, in the past, manufactured dispersions primarily for the coatings    
industries.  The sectors and clientele served by Leatherchem, will not only add 
new products to the Rolfes basket, but will also open up new sectors and        
customers to Rolfes, enhance the technology base and increase the production    
capacity of the current dispersion unit.                                        
The acquisition of Leatherchem also provides the group with a foothold and      
presence in the Cape Town market.  Rolfes will be distributing the Leatherchem  
products in the central and northern regions of South Africa and will export the
products into Europe and Africa.                                                
The production facilities of Leatherchem are not at present fully utilised,     
providing room for significant growth.  Leatherchem will also be able to use    
certain Rolfes manufactured pigments in its production process.                 
Terms of transaction                                                            
In terms of the sale agreement, Rolfes acquired the entire issued share capital 
in and claims against Leatherchem, with effect from 1 July 2007, for a          
consideration of R15 million.  The purchase consideration is payable as to      
R11 250 000 in cash and the issue of a number of ordinary Rolfes shares, to be  
issued at a price equal to the 30-day volume weighted average price as at the   
closing date, expected to be on or about 5 December 2007.                       
The sale agreement contains warranties and indemnities normal to a transaction  
of this nature.  The agreement is subject to certain suspensive conditions which
have all been fulfilled except for the conclusion of a lease agreement in       
respect of the premises from which Leatherchem operates, which will be concluded
in the next few days.                                                           
The senior executives (including the vendor) have all signed two year service   
and three year restraint of trade agreements.                                   
Financial effects of transaction                                                
The financial effect of the transaction on the audited headline earnings per    
share, basic earnings per share, net asset value per share and net tangible     
asset value per share of Rolfes for the year ended 30 June 2007, had the        
transaction been effective 1 July 2006, is not material but is earnings and     
assets enhancing.                                                               
Further cautionary announcement                                                 
Shareholders are referred to the cautionary announcement dated 9 November 2007  
and are advised that caution is still required to be exercised when dealing with
their Rolfes shares as Rolfes has entered into fresh  negotiations with another 
third party which, if successfully concluded, may have a material effect on     
Rolfes` share price.                                                            
28 November 2007                                                                
Designated and Corporate Adviser                                                
PSG CAPITAL (PTY) LIMITED                                                       
Date: 28/11/2007 10:36:38 Supplied by www.sharenet.co.za                     
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