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Scl - Sacoil Holdings Limited - Usd25m Standby Equity Distribution

Release Date: 13/10/2011 15:00:40      Code(s): SCL
SCL - SACOIL Holdings Limited - USD25m Standby Equity Distribution              
Agreement/Pro forma financial effects/Further cautionary announcement           
SACOIL HOLDINGS LIMITED                                                         
(Incorporated in the Republic of South Africa)                                  
(Registration number 1993/000460/06)                                            
JSE share code: SCL                                                             
AIM share code: SAC                                                             
ISIN: ZAE0000127460                                                             
("SacOil" or "the Company" or "the Group")                                      
USD25m Standby Equity Distribution Agreement                                    
Pro forma financial effects                                                     
Further cautionary announcement                                                 
1.   Introduction                                                               
Shareholders of SacOil ("Shareholders") are referred to the announcement        
released on the Securities Exchange News Service ("SENS") of the JSE Limited    
("JSE") and on the Regulatory News Service of the London Stock Exchange on      
Friday, 2 September 2011 regarding the specific issue of ordinary shares to     
Timtex Investments (Proprietary) Limited ("Timtex"), an associate of Encha      
Group Limited ("Encha") ("the Specific Issue"), the promoter`s fee of R1 500    
000 payable to Encha ("the Promoter`s Fee") and the cautionary announcement     
(collectively "the Announcement")).                                             
2.   USD25m Standby Equity Distribution Agreement                               
On Wednesday, 12 October 2011 SacOil entered into a Standby Equity              
Distribution Agreement ("SEDA") of USD25m ("Commitment Amount") with Yorkville  
Advisers UK LLP ("YA"), an exempt limited partnership registered in the Cayman  
Islands.                                                                        
The SEDA is available, unless otherwise terminated earlier in accordance with   
its terms, for a period of three years and the number and timing of each        
advance draw down ("Advance") is at the discretion of the Company provided      
that the Company shall not be entitled to draw down more than one advance       
every five trading days, unless otherwise approved by YA.                       
Limitations on the number of Advances as well as the quantum of the Advances,   
ensures a spread of the drawdown amounts over a three year period. In           
spreading the drawdowns over three years, the dilution of existing              
Shareholders is also spread to avoid sudden dilution of existing Shareholders`  
interests in the Company.                                                       
Each Advance by the Company will be settled by the issue of new Ordinary        
Shares ("Ordinary Shares"). Any Ordinary Shares to be issued in relation to an  
Advance shall be listed on the JSE and admitted to trading on AIM. The number   
of Ordinary Shares to be issued in relation to an Advance shall be equal to     
the Advance amount divided by the purchase price, where the purchase price      
shall be 94% of the lowest of the daily volume weighted average prices          
("VWAP") of the Ordinary Shares of the Company during the period of 5           
consecutive trading days beginning on the first trading day after the date of   
the Advance notice.                                                             
The SEDA improves SacOil`s ability to fund its current and future operational   
obligations.                                                                    
Any issue of shares in terms of the SEDA constitutes a specific issue of        
shares for cash in terms of JSE Listings Requirements, and accordingly          
requires approval by Shareholders.                                              
3.   Pro Forma financial effects                                                
Shareholders are advised that updated unaudited pro forma financial effects     
relating to the Specific Issue and the Promoters Fee as published in the        
Announcement, has been set out below.  The table below furthermore includes     
the unaudited pro forma financial effects of SEDA.                              
The pro forma financial effects have been prepared using accounting policies    
that comply with International Financial Reporting Standards and that are       
consistent with those applied in the audited, published financial statements    
of SacOil for the year ended 28 February 2011.                                  
It has been assumed for purposes of the pro forma financial effects that the    
proposed transactions took place with effect from 1 March 2010 for statement    
of comprehensive income purposes and at 28 February 2011 for statement of       
financial position purposes.                                                    
The unaudited pro forma financial effects set out below are the responsibility  
of the directors of the Company and have been prepared for illustrative         
purposes only and because of their nature may not fairly present the financial  
position, changes in equity, and results of operations or cash flows of SacOil  
after the transactions.                                                         
                     Before   After the  Percentage  After the  Percentage      
                     1        Specific   change      Specific   change          
                              Issue and  (%)3        Issue,     (%)5            
Promoter`s             Promoter`s                 
                              Fee2                   Fee and                    
                                                     SEDA4                      
                                                                                
Loss per share        (6.67)   (5.30)     20.59       (3.33)     37.17          
(cents)                                                                         
Diluted loss per      (6.21)   (5.00)     19.48       (3.21)     35.82          
share (cents)                                                                   
Headline loss per     (6.62)   (5.30)     19.93       (3.30)     37.69          
share (cents)                                                                   
Diluted headline loss (6.16)   (5.00)     18.82       (3.18)     36.34          
per share (cents)                                                               
Net asset value per   69.57    69.08      (0.71)      65.39      (5.34)         
share (cents)                                                                   
Net tangible asset    11.03    18.87      71.10       30.33      60.74          
value per share                                                                 
(cents)                                                                         
Weighted average      449 629  561 569    24.90       901 198    60.48          
number of shares in                                                             
issue (000`s)                                                                   
Weighted average      482 933  594 873    23.18       934 503    57.09          
number of shares in                                                             
issue for dilution                                                              
(000`s)                                                                         
Number of shares      674 090  786 031    16.61       1 125 660  43.21          
issued (000`s)                                                                  
Notes:                                                                          
                                                                                
The pro forma financial effects of the SEDA have been calculated based on the   
following assumptions:                                                          
-    YA advanced a maximum commitment amount of  USD25m to SacOil and elected   
    to subscribe for up to the South African Rand equivalent in Ordinary        
Shares on 28 February 2011; and                                             
-    The Rand amount in respect of the Commitment Amount was calculated for     
    illustrative purposes using the exchange rate of R7.93 to USD1.00 on 11     
    October 2011, being the last practicable date and using an estimated        
number of shares of 339 629 332 which has been calculated based on the      
    conversion price of 58 cents per Ordinary Share, being a 6.0% discount to   
    the 5 day VWAP of Ordinary Shares to 11 October 2011.                       
    1.   The "Before" column has been extracted without adjustment from the     
audited, published results of SacOil for the year ended 28 February    
         2011. The "Before" net asset value and net tangible asset value per    
         SacOil Ordinary Share have been calculated from the financial          
         information presented in the audited, published results of SacOil      
for the year ended 28 February 2011.                                   
    2.   The "After the Specific Issue and the Promoter`s Fee" is based on:     
         (a)  Issue of 111, 940, 298 new Ordinary Shares at R0.67 per           
              Ordinary Share, being the closing price of SacOil Ordinary        
Shares on 29 August 2011;                                         
         (b)  Payment of the Promoters Fee of R1, 500, 000 (Including VAT) to   
              Encha. As this cost was incurred in the course of issuing         
              ordinary shares in SacOil it has been debited directly to         
equity in terms of IAS 32: Financial Instruments;                 
         (c)  Payment of estimated transaction costs amounting to R279, 000     
              in respect of the specific issue to Timtex. As these costs were   
              incurred in the course of issuing ordinary shares in SacOil       
they have been debited directly to equity in terms of IAS 32:     
              Financial Instruments; and                                        
         (d)  No income benefit has been attributed to the cash received in     
              respect of the specific issue of shares as the proceeds with be   
used to fund working capital.                                     
    3.   Measured as the "After the Specific Issue and the Promoter`s Fee"      
         column as a percentage of the "Before" column.                         
    4.   The "After the Specific Issue, the Promoters Fee and the SEDA" is      
based on:                                                              
         (a)  the adjustments detailed in note 2 above;                         
         (b)  The conversion of the maximum commitment amount of USD 25, 000,   
              000 on 28 February 2011 into 339 629 332 ordinary shares at a     
6,0 % discount to the 5-day volume weighted average price         
              (Rounded up to the nearest half cent) to 11 October 2011;         
         (c)  Payment of implementation fee of R3 962 642, due diligence fee    
              R123 710 and legal expenses of R185 566, in respect of the        
SEDA. As these costs were incurred in the course of issuing       
              ordinary shares in SacOil they have been debited directly to      
              equity in terms of IAS 32: Financial Instruments;                 
         (d)  Payment of estimated transaction costs amounting to R736 000 in   
respect of the specific issue to YA. As these costs were          
              incurred in the course of issuing ordinary shares in SacOil       
              they have been debited directly to equity in terms of IAS 32:     
              Financial Instruments; and                                        
(e)  No income benefit has been attributed to the cash received in     
              respect of the specific issue of shares as the proceeds with be   
              used to fund working capital                                      
    5.   Measured as the "After the Specific Issue, the Promoter`s Fee and      
the SEDA" column as a percentage of the "After the Specific Issue      
         and the Promoter`s Fee " column                                        
4.   Circular to Shareholders                                                   
In the Announcement, Shareholders were advised that a circular, setting out     
the full terms of the Specific Issue, the Promoter`s Fee and incorporating a    
notice convening a general meeting of Shareholders of ordinary shares would be  
posted on or about 30 September 2011.                                           
Shareholders are herewith advised that a Circular is currently in the process   
of being approved by the JSE, setting out full details of the Specific Issue,   
the Promoters Fee and SEDA, and which will be posted to Shareholders before     
the end of October 2011.                                                        
The salient dates and times of the general meeting will be announced in due     
course.                                                                         
5.   Further cautionary announcement                                            
Shareholders are advised that the Company continues to consider various         
proposals and potential transactions, which if successfully concluded, may      
have a material effect on the price of SacOil`s securities. Accordingly,        
Shareholders are advised to continue to exercise caution when dealing in the    
Company`s securities until a further announcement in this regard is made.       
Johannesburg                                                                    
13 October 2011                                                                 
JSE Sponsor                                                                     
The Standard Bank of South Africa Limited                                       
For further information please contact:                                         
AIM Nominated Adviser and Joint Broker                                          
finnCap Ltd                                                                     
Matthew Robinson / Christopher Raggett                +44 (0)20 7220 0500       
Joint Broker (United Kingdom)                                                   
Shore Capital Stockbrokers Ltd                                                  
Jerry Keen / Bidhi Bhoma                              +44 (0)20 7408 4090       
Public Relations (South Africa)                                                 
The Riverbed Agency (SA)                                                        
Raphala Mogase / Bongiwe Moeli                        +27 (0) 11 783 7903       
Public Relations (United Kingdom)                                               
Pelham Bell Pottinger (UK)                                                      
Philip Dennis                                         +44 (0)20 7861 3919       
Nick Lambert                                          +44 (0)20 7861 3936       
Rollo Critchton-Stuart                                +44 (0)20 7861 3918       
Date: 13/10/2011 15:00:40 Supplied by www.sharenet.co.za                     
Produced by the JSE SENS Department                             .                  
The SENS service is an information dissemination service administered by the    
JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or            
implicitly, represent, warrant or in any way guarantee the truth, accuracy or   
completeness of the information published on SENS. The JSE, their officers,     
employees and agents accept no liability for (or in respect of) any direct,     
indirect, incidental or consequential loss or damage of any kind or nature,     
howsoever arising, from the use of SENS or the use of, or reliance on,          
information disseminated through SENS.                                          



                                        
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