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Wescoal Holdings Limited - Acquisition Of Coal Business From Macphail

Release Date: 13/08/2013 08:20:00      Code(s): WSL     

WESCOAL HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2005/006913/06)
JSE Share code: WSL & ISIN: ZAE000069639
("Wescoal" or "the Company")


UPDATE ON ACQUISITION OF COAL TRADING BUSINESS FROM MACPHAIL


1. INTRODUCTION

Shareholders are referred to the SENS announcements dated 21 June and 13 June 2013 where 
shareholders were advised that Chandler Coal Proprietary Limited (Chandler), a wholly 
owned subsidiary of Wescoal, has made an offer to acquire a coal trading business from a 
third party (the "Third Party"), subject to certain suspensive conditions. The Third Party 
is MacPhail Distributors (Pty) Ltd (MacPhail) (MacPhail acquisition).

On 8 August 2013, Chandler entered into a Sale of Business Agreement (Business Agreement) 
with MacPhail, to acquire the business as a going concern from MacPhail (the seller), with 
effect from 1 October 2013, or the first business day following the date of fulfilment of the 
last of the suspensive conditions, whichever date occurs last (effective date).
 
On the same date, Blanford 006 (Pty) Ltd (Blanford), a wholly owned subsidiary of Chandler, 
signed a Sale of Property Agreement (Property Agreement) with FSW Property Trust to purchase:
- Erf 635 Wells Estate, Nelson Mandela Metropolitan Municipality, Division of Port Elizabeth, 
  Province Eastern Cape;
- Erf 13936 Worcester, situate in the Breede Vallei Municipality, Division of Worcester, 
  Province Western Cape;
- Erf 16069 Worcester, situate in the Breede Vallei Municipality, Division of Worcester, 
  Province Western Cape; and 
- Erf 7556 George, situate in the George Municipality, Division of George, Province Western Cape
 
(the properties) as a going concern (the properties acquisition).

The MacPhail acquisition and the properties acquisition are collectively referred to herein as 
the acquisitions.

2. TERMS AND CONDITIONS OF THE MACPHAIL ACQUISITION

2.1 The total purchase price for the MacPhail acquisition is R 65.5 million exclusive of VAT at 
a rate of zero percent, consisting of fixed assets, stock, contracts, intellectual property, 
leases and goodwill, subject to inventory adjustment on the effective date.

2.2	The MacPhail acquisition is subject to inter alia the following outstanding suspensive 
conditions:
2.2.1 the seller obtaining a special resolution from shareholders approving the disposal;
2.2.2 the lodgement of the application to the Competition Authorities;
2.2.3 Chandler and Blanford being able to secure funding for the acquisitions;
2.2.4 approval of the acquisitions by Wescoal shareholders;
2.2.5 all the necessary regulatory approvals, including JSE Limited (JSE) and Competition 
Commission approvals for the acquisition.
2.3 The purchase price for the MacPhail acquisition will be paid on the effective date out of 
current cash resources and bank funding.


2.4 The purchase price is subject to possible adjustment, depending on the outcome of a stock 
take the day before the effective date.
 
2.5 The MacPhail acquisition is subject to warranties that are customary in transactions of 
this nature.

2.6 The seller and certain third parties will be subject to a restraint of trade. 

3. TERMS AND CONDITIONS OF THE PROPERTIES ACQUISITION

3.1	The total purchase consideration for the properties is R13, 5 million exclusive of VAT 
at a rate of zero percent.

3.2	The properties acquisition is subject to inter alia the following outstanding suspensive 
condition, namely that all the suspensive conditions included in the Business Agreement are 
fulfilled or waived.

3.3	The purchase price is payable in cash on the transfer date and will be funded by bank 
funding.

4 FURTHER UPDATE

Shareholders will be notified once the circular has been posted.


Corporate adviser & Sponsor				Legal adviser 
Exchange Sponsors 					KWA Attorneys


Johannesburg
13 August 2013




Date: 13/08/2013 08:20:00 Supplied by www.sharenet.co.za                     
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