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STANDARD BANK INVESTMENT CORPORATION LIMITED
(INCORPORATED IN THE REPUBLIC OF SOUTH AFRICA)
(REGISTRATION NUMBER 69/17128/06)
("STANBIC")
SIMPLIFICATION OF GROUP STRUCTURE
1. INTRODUCTION
SHAREHOLDERS ARE REFERRED TO THE ANNOUNCEMENT DETAILING THE PROPOSALS BY
LIBERTY HOLDINGS LIMITED ("LIBHOLD"), LIBERTY LIFE ASSOCIATION OF AFRICA
LIMITED ("LIBERTY LIFE") AND LIBLIFE STRATEGIC INVESTMENTS LIMITED ("LIBSIL")
(COLLECTIVELY, "THE LIBERTY LIFE GROUP") TO DISTRIBUTE PRO RATA TO THEIR
SHAREHOLDERS THE INTERESTS IN STANBIC ORDINARY SHARES HELD ON ACCOUNT OF
SHAREHOLDERS ("THE UNBUNDLING"). AN AGGREGATE NUMBER OF 376 744 205 STANBIC
ORDINARY SHARES WILL BE DISTRIBUTED TO THE SHAREHOLDERS OF LIBSIL, LIBERTY LIFE
AND LIBHOLD ON IMPLEMENTATION OF THE UNBUNDLING. THIS AMOUNTS TO APPROXIMATELY
27,4% OF THE STANBIC ORDINARY SHARES CURRENTLY IN ISSUE.
THE BOARD OF DIRECTORS OF STANBIC SUPPORTS FULLY THE UNBUNDLING AND BELIEVES
THAT THE RESULTANT BENEFITS TO STANBIC AND THE LIBERTY LIFE GROUP WILL BE
SIGNIFICANT.
2. EFFECTS OF THE UNBUNDLING ON STANBIC
2.1 RECEIPT OF STANBIC ORDINARY SHARES BY STANBIC
AS A RESULT OF THE UNBUNDLING, STANBIC, BY WAY OF ITS 54,8% SHAREHOLDING IN
LIBHOLD, WILL RECEIVE 96 162 669 STANBIC ORDINARY SHARES, REPRESENTING 7,0% OF
THE ISSUED SHARE CAPITAL OF STANBIC ("THE STANBIC OWNED SHARES"). WHILST THE
STANBIC OWNED SHARES WILL NOT BE CANCELLED BY STANBIC, THEY WILL BE DISREGARDED
FOR THE PURPOSES OF EARNINGS AND CAPITAL ADEQUACY CALCULATIONS.
THE DIRECTORS OF STANBIC ARE SATISFIED THAT THE UNBUNDLING WILL NOT HAVE AN
ADVERSE EFFECT ON THE CAPITAL ADEQUACY OF THE GROUP. SHAREHOLDERS ARE REFERRED
TO THE STANBIC INTERIM RESULTS ANNOUNCEMENT TO BE PUBLISHED LATER TODAY.
STANBIC'S CAPITAL ADEQUACY RATIO AT 30 JUNE 1999 IS 10,6% AND IS NOT EXPECTED
TO CHANGE AS A RESULT OF THE UNBUNDLING.
2.2 ELIMINATION OF CROSSHOLDING
THE UNBUNDLING WILL RESULT IN THE ELIMINATION OF THE CROSSHOLDING OF THE
LIBERTY LIFE GROUP IN STANBIC, SAVE FOR THE INTEREST OF APPROXIMATELY 10% IN
STANBIC HELD BY LIBERTY LIFE ON ACCOUNT OF ITS POLICYHOLDERS. THE UNBUNDLING
WILL THUS HAVE THE EFFECT OF BOTH SIMPLIFYING THE COMPLEX GROUP STRUCTURE AND
REDUCING THE NUMBER OF INVESTOR ENTRY POINTS INTO THE GROUP. STANBIC REMAINS
THE ULTIMATE HOLDING COMPANY OF THE LIBERTY LIFE GROUP.
IN ADDITION, STANBIC HAS TO DATE NOT QUALIFIED FOR INCLUSION IN THE LEADING
EMERGING MARKET INDICES SUCH AS THE MORGAN STANLEY CAPITAL INTERNATIONAL AND
THE INTERNATIONAL FINANCE CORPORATION INDICES BECAUSE OF THE CROSSHOLDING
BETWEEN STANBIC AND THE LIBERTY LIFE GROUP. IT IS NOW POSSIBLE THAT STANBIC
COULD BE CONSIDERED FOR INCLUSION IN THOSE INDICES.
2.3 INCREASE IN SHAREHOLDER BASE AND LIQUIDITY
THE UNBUNDLING WILL HAVE THE EFFECT OF INCREASING THE NUMBER OF SHAREHOLDERS IN
STANBIC FROM APPROXIMATELY 16 000 TO IN EXCESS OF 30 000, HOLDING 1 276 744 746
ORDINARY SHARES WITH A MARKET VALUE OF APPROXIMATELY R26,4 BILLION. OLD MUTUAL
PLC WILL BE THE ONLY SHAREHOLDER HOLDING IN EXCESS OF 20% OF THE ISSUED SHARE
CAPITAL OF STANBIC. APPROXIMATELY 60% OF THE ISSUED SHARE CAPITAL OF STANBIC
WILL BE HELD BY SHAREHOLDERS WHO INDIVIDUALLY HOLD LESS THAN 5%, WHICH SHOULD
SIGNIFICANTLY ENHANCE THE LIQUIDITY IN STANBIC ORDINARY SHARES.
2.4 INVESTOR PRESENTATIONS
ALTHOUGH THE BENEFITS OF THE UNBUNDLING ARE READILY APPARENT, THE MANAGEMENT OF
STANBIC WILL CONDUCT INVESTOR PRESENTATIONS IN MID - SEPTEMBER 1999 TO DOMESTIC
AND INTERNATIONAL INVESTORS TO CREATE AN AWARENESS OF THE NEW STRUCTURE AND TO
ENHANCE THEIR UNDERSTANDING OF STANBIC.
JOHANNESBURG
19 AUGUST 1999
MERCHANT BANK
SCMB
STANDARD CORPORATE AND MERCHANT BANK
(A DIVISION OF THE STANDARD BANK OF SOUTH AFRICA LIMITED)
(REGISTRATION NUMBER 62/00738/06)
ATTORNEYS
EDWARD NATHAN & FRIEDLAND INC
(REGISTRATION NUMBER 77/00525/21)
JOINT SPONSORING BROKERS
STANDARD EQUITIES (PTY) LIMITED
(REGISTRATION NUMBER 72/08305/07)
(MEMBER OF THE JOHANNESBURG STOCK EXCHANGE)
MERRILL LYNCH SOUTH AFRICA (PTY) LTD
MEMBER OF THE JOHANNESBURG STOCK EXCHANGE
REGISTRATION NUMBER 95/01805/07
