ZEDER INVESTMENTS LIMITED - Internalisation of management agreement and cautionary announcement

Internalisation of management agreement and cautionary announcement

Zeder Investments Limited
(Incorporated in the Republic of South Africa)
Registration number: 2006/019240/06
Share code: ZED
ISIN code: ZAE000088431
(“Zeder”)

PSG Group Limited
(Incorporated in the Republic of South Africa)
Registration number 1970/008484/06
Share code: PSG
ISIN code: ZAE000013017
(“PSG”)

INTERNALISATION OF MANAGEMENT AGREEMENT AND CAUTIONARY ANNOUNCEMENT

1.   Shareholders are advised that Zeder and PSG, through its wholly-
     owned subsidiary PSG Corporate Services Proprietary Limited
     (“PSGCS”), have agreed that the existing management agreement and
     function in terms of which PSGCS provides investment, management,
     financial and other services to Zeder and its subsidiaries, be
     internalised by Zeder against the issue of 207 661 758 new Zeder
     ordinary shares to PSGCS at Zeder’s 30 day volume weighted average
     share price up to the effective date (“Internalisation”).

2.   The Internalisation will result in a significant improvement in
     Zeder’s future profitability and cash flows, and potentially its
     market rating following the associated management fee cost
     savings. PSG will remain a significant shareholder in Zeder and
     the existing PSG representatives will continue to serve on both
     the Zeder Executive Committee and Zeder Board to help determine
     strategy and make investment decisions for at least the next 5
     years at a nominal fee of R5 million per annum.

3.   Should the Internalisation be implemented, PSG’s shareholding in
     Zeder will increase from approximately 34.5% to approximately
     42.4% of Zeder’s total issued ordinary share capital.

4.   The Internalisation is subject to various conditions precedent,
     including Zeder shareholder approval and the waiver by Zeder
     shareholders of a mandatory offer to them by PSG as a result of
     this transaction. Indications are that the major shareholders
     support the Internalisation as set out above.

5.   A circular will be dispatched to Zeder shareholders in due course
     to provide them with detailed information regarding the
     Internalisation and to convene a general meeting, at which
     shareholders other than PSG will have the opportunity to consider
     and vote on the Internalisation.

6.   An independent board has been constituted by Zeder to consider
     the Internalisation and to advise shareholders of their opinion
     in relation to the Internalisation. The independent board has,
     in turn, appointed an independent expert to provide it with
     external advice and to prepare a report, indicating whether the
     Internalisation   would  be   fair  and  reasonable   to  Zeder
     shareholders. A copy of this report will be included in the
     circular to Zeder shareholders.

7.   Zeder shareholders are advised to exercise caution when dealing
     in Zeder’s securities until full details regarding the
     Internalisation have been made public.

Stellenbosch
24 June 2016

PSG Capital: Transaction adviser and sponsor to Zeder and PSG

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