LEWIS GROUP LIMITED - Voluntary Announcement - The Purchase Of The Ellerines And Beares Businesses In Namibia, Lesotho, Botswana And Swazi

Voluntary Announcement - The Purchase Of The Ellerines And Beares Businesses In Namibia, Lesotho, Botswana And Swazi

Lewis Group Limited
Reg No. 2004/009817/06
JSE Share Codes:
LEW ISIN: ZAE000058236
LEW01 ISIN: ZAG00011022


(“Lewis”or the “Group”)

VOLUNTARY ANNOUNCEMENT - THE PURCHASE OF THE ELLERINES AND BEARES BUSINESSES
IN NAMIBIA, LESOTHO, BOTSWANA AND SWAZILAND


1.      Introduction


        Shareholders are advised that Lewis’ subsidiaries incorporated in each of Namibia, Lesotho,
        Botswana and Swaziland (“the Jurisdictions”) have entered into sale of business agreements with
        the relevant in-country subsidiaries of Ellerine Services Proprietary Limited (a wholly owned
        subsidiary of Ellerine Furnishers Proprietary Limited (in Business Rescue) (“Ellerines”)), to acquire
        their businesses trading under the “Ellerines” and “Beares” brands in each of the Jurisdictions
        (“Transactions”).


2.      Salient details


        The Transactions include the acquisition of 25 stores in Botswana, 10 stores in Lesotho, 21 stores in
        Namibia and 6 stores in Swaziland. The assets to be acquired in terms of the Transactions and
        related transactions include all fixed assets, stock, intellectual property and the debtors book in
        respect of each business as well as the Ellerines and Beares club.             It is anticipated that all
        employees of such businesses who wish to transfer to the subsidiaries of Lewis will do so on
        implementation of each of the Transactions, subject to compliance with the applicable legislation in
        the Jurisdictions.


        The purchase consideration will be determined as at the effective date of each of the relevant
        Transactions with reference to the value of the fixed assets, stock and the debtors book of each of
        the businesses to be acquired and the number of store lease agreements that are successfully
        assigned to the subsidiaries of Lewis. The aggregate gross purchase consideration is anticipated to
        be approximately R250 million.


        The implementation of each of the Transactions is subject to suspensive conditions traditional for
        transactions of this nature and include inter alia:


                     -    In respect of Botswana, Namibia and Swaziland, obtaining the approval of the
                          relevant competition authorities in each such jurisdiction; and


                     -    Obtaining other necessary regulatory consents in each Jurisdiction.
                                                                                                              2

       Should any of the transactions not be implemented, the remaining transactions will still be
       implemented.


        Lewis expects the Transactions to be implemented by 28 February 2016.

3.      Rationale for the Transactions


        Ellerines and Beares are both well-established retail furniture businesses across Southern Africa.
        The Transactions will enable Lewis to expand and diversify its Southern African footprint by gaining
        access to new segments of the furniture retail market and by expanding its existing customer base in
        each of the Jurisdictions.


        Beares is a scalable brand which offers growth prospects for the group. The acquisition by Lewis of
        the South African Beares business from Ellerines during 2014 has attracted new customers to the
        group. Similarly, the acquisition of these businesses will provide the Group with greater access to
        customers in higher income segments in those Jurisdictions.


The Transactions are not classified as a categorised transaction in terms of the JSE Listings Requirements.




Cape Town
9 November 2015

Sponsor
UBS South Africa (Pty) Ltd

Legal advisor
Edward Nathan Sonnenbergs

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