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NETWORK HEALTHCARE HOLDINGS LIMITED
(Registration number 1996/008242/06)
(Incorporated in the Republic of South Africa)
("Netcare")
CLINIC HOLDINGS LIMITED
(Registration number 1987/004106/06)
(Incorporated in the Republic of South Africa)
("Clinics")
ANNOUNCEMENT OF THE PURCHASE FROM FEDSURE LIFE ASSURANCE LIMITED IN TERMS OF A
SPECIFIC AUTHORITY OF NETCARE ORDINARY SHARES BY NETCARE OR A SUBSIDIARY OF
NETCARE TO BE NOMINATED BY NETCARE
1. Introduction
Further to the announcement of 4 January 2001, Netcare or a nominated
subsidiary of Netcare (which, if Clinics obtains the requisite approval in
general meeting, will be Netcare Hospital Group (Proprietary) Limited, a wholly
owned subsidiary of Clinics, which in turn is a subsidiary of Netcare) intends
to purchase 55 000 000 Netcare ordinary shares from Fedsure Life Assurance
Limited for a purchase price of R60 500 000, being 110 cents per Netcare
ordinary share, with effect from 29 December 2000, subject to the resolutive
condition, stipulated below ("the specific repurchase").
The purchase of shares will be funded from the financial resources of the
Netcare Group, and will result in such shares not being cancelled but, instead,
held as treasury shares.
2. Resolutive Condition
The purchase is subject to the resolutive condition that the following events
shall not have occurred by 15 March 2001
- the purchase shall have failed to have been approved at general meetings of
Netcare and Clinics, respectively, insofar as such approvals are required in
law;
- the purchase shall have failed to have been approved by the JSE Securities
Exchange South Africa and the Securities Regulation Panel, insofar as such
approvals are required in law.
3. Opinions
The directors of Netcare and Clinics, respectively, have considered the impact
of the share repurchase and are unanimously of the opinion that:
- the Netcare and Clinics Groups will be able in the ordinary course of
business to pay their debts for a period of 12 months from the date of this
announcement;
- the assets of each of the Netcare and Clinics Groups, fairly valued in
accordance with Statements of Generally Accepted Accounting Practice, will
remain in excess of their liabilities;
- the issued ordinary capital and reserves of each of the Netcare and Clinics
Groups are adequate for the purposes of the respective businesses for a period
of 12 months from the date of this announcement; and
- the working capital available to each of the Netcare and Clinics Groups is
sufficient for their requirements for a period of 12 months from the date of
this announcement.
4. Effects of the purchase
4.1 Netcare
The effects of the specific repurchase on the earnings and net asset value per
Netcare share, which have been reviewed by the reporting accountants, are as
follows -
Audited Pro forma % change
- Before - After
30 September 30 September
2000 2000
Headline Earnings per share (cents) 20.2 20.7 2.5%
Attributable Earnings per share (cents) 19.4 19.9 2.6%
Net Tangible Asset Value per share (cents) 102.8 102.3 (0.5%)
Assumptions
a based on the audited financial statements for the twelve month period ended
30 September 2000;
b adjusted for the cost of funding applicable to the Netcare Group of 14%
(before tax) in the twelve month period ended 30 September 2000;
c weighted average number of shares adjusted for specific repurchase
- before - 1,336m
- after - 1,281m.
4.2 Clinics
Should Clinics obtain the requisite approval, and Netcare Hospital Group
(Proprietary) Limited purchases the shares, the following tables illustrate the
effects of the specific repurchase on the earnings and net asset value per
Clinics share, which have been reviewed by the reporting accountants, based on
the audited financial statements for the twelve month period ended 30 September
2000 and adjusted for the cost of funding of 14% (before tax) applicable to the
Clinics Group for the same period.
4.2.1 Earnings Per Share - Accounting for Attributable Earnings of Netcare
Shares
Audited Pro forma % change
- Before - After
30 September 30 September
2000 2000
Headline Earnings per share (cents) 38.2 38.9 1.8%
Attributable Earnings per share (cents) 37.1 37.8 1.8%
4.2.2 Earnings Per Share - Disregarding Attributable Earnings of Netcare Share
Audited Pro forma % change
- Before - After
30 September 30 September
2000 2000
Headline Earnings per share (cents) 38.2 37.4 (2.2%)
Attributable Earnings per share (cents) 37.1 36.2 (2.3%)
4.2.3 Net Asset Value
Audited Pro forma % change
- Before - After
30 September 30 September
2000 2000
Net tangible asset value per share (cents) 205.9 205.1 (0.4%)
5. Date of the general meetings
A general meeting of Netcare will be held at 10h30 on Friday, 9 March 2001 for
the purpose of considering and, if deemed fit, passing, with or without
modification the special and ordinary resolutions to approve the purchase.
A general meeting of Clinics will be held at 11h00 on Friday, 9 March 2001, or
as soon as possible after the completion of the general meeting of shareholders
of Netcare to be held at 10h30 on the same date, for the purpose of considering
and, if deemed fit, passing, with or without modification the special and
ordinary resolutions to effect the purchase.
Circulars to each of the Netcare and Clinics shareholders, respectively,
containing details of the above will be dispatched to those shareholders on or
about 15 February 2001.
Any changes to the abovementioned dates will be published in the press.
Johannesburg
12 February 2001
Sponsor
Smith Borkum Hare
Merrill Lynch South Africa (Pty) Ltd.
Member of the JSE Securities Exchange South Africa
Registration Number 1995/01805/07
Reporting Accountants
Fisher Hoffman PKF (Jhb) Inc
Registration Number 1994/001166/21
Chartered Accountants (SA)
Registered Accountants and Auditors
Attorneys
H R Levin
