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Further Announcement Relating to Trencor's Beneficiary Interest in Textainer Group Holdings Limited
TRENCOR LIMITED
Incorporated in the Republic of South Africa
(Registration Number 1955/002869/06)
Share code: TRE
ISIN: ZAE000007506
(“Trencor” or “Trencor group”)
FURTHER ANNOUNCEMENT RELATING TO TRENCOR’S BENEFICIARY INTEREST IN
TEXTAINER GROUP HOLDINGS LIMITED
1. Introduction
We draw attention to the Trencor SENS announcement released on Tuesday, 11 September
2012 and the news release issued by Textainer Group Holdings Limited (“Textainer”) on
Thursday, 13 September 2012 that is included at the bottom of this announcement. Trencor,
in its capacity as a discretionary beneficiary of the Halco Trust, the sole shareholder of Halco
Holdings Inc. (“Halco”), has a 60,01% beneficiary interest in Textainer immediately prior to
the transactions set out in this announcement and in the announcement released by Trencor
on Tuesday, 11 September 2012.
Textainer has offered 5 000 000 new Textainer common shares at a price of $31.50 per
Textainer share (the “Primary Placing”) and Halco has offered, from its existing shareholding
in Textainer, an aggregate of 2 500 000 Textainer common shares at a price of $31.50 per
Textainer share (the “Secondary Placing”) in a registered underwritten public offering (the
“Transaction”).
2. Rationale for the Transaction
Halco and Trencor believe that the Transaction is in the best interests of Textainer, Halco and
Trencor shareholders (“Shareholders”) given that it:
- provides Textainer with capital required for capital expenditures and general corporate
purposes;
- facilitates increased liquidity in the Textainer share on the New York Stock Exchange
(“NYSE”) due to the enlarged “free float”, and thus should improve shareholder value;
- enhances the efficacy of the existing Trencor group structure from a corporate
governance and regulatory perspective; and
- is another step in a series of transactions implemented by Trencor over a long period
of time to restructure the Trencor group with the ultimate objective of maximizing
shareholder value over time.
Notwithstanding the Transaction, Trencor is fully confident of the future potential of Textainer
and remains a strategic and committed beneficiary shareholder in Textainer.
3. Financial effects
The table below sets out the unaudited pro forma financial effects of the Transaction on
Trencor’s earnings per share (“EPS”), headline EPS (“HEPS”), adjusted HEPS, net asset
value (“NAV”) and tangible NAV (“TNAV”).
The unaudited pro forma financial effects have been prepared using accounting policies that
comply with International Financial Reporting Standards and that are consistent with those
applied in the unaudited group interim results for the six months ended 30 June 2012 as well
as the audited group results of Trencor for the 12 months ended 31 December 2011.
The unaudited pro forma financial effects, which are the responsibility of the Trencor board of
directors, are provided for illustrative purposes only and, because of their pro forma nature,
may not fairly present Trencor’s financial position, changes in equity, results of operations or
cash flow. The unaudited pro forma financial effects do not assume deployment, per the
rationale above, of the capital raised by Textainer in the Primary Placing.
Before the After the
Change
Transaction1 Transaction6,7
(%)
(cents) (cents)
EPS2,4 261,5 223,5 (14,53)
HEPS2,4 262,3 224,2 (14,53)
Adjusted HEPS2,4,5 256,7 218,6 (14,84)
NAV3 2 887,2 3 052,2 5,71
TNAV3 2 683,4 2 848,3 6,15
Weighted average number of
Trencor shares in issue 177,1 177,1 -
(millions)
Number of Trencor shares in
177,1 177,1 -
issue (millions)
Notes and assumptions:
1. The Trencor financial information reflected in the “Before” column has been calculated from the most
recent published unaudited group interim results of Trencor (six months ended 30 June 2012) which were
prepared using accounting policies that comply with International Financial Reporting Standards and are
consistent with those applied in the audited group results of Trencor for the 12 months ended 31
December 2011.
2. The pro forma adjustments to the unaudited condensed consolidated statement of comprehensive income
have been calculated on the assumption that the Transaction was implemented on 1 January 2012. The
ZAR/USD exchange rate used to translate USD amounts is the same as the average rate used in the most
recent published unaudited group interim results of Trencor (six months ended 30 June 2012), being
R7,89=$1.
3. The pro forma adjustments to the unaudited condensed consolidated statement of financial position have
been calculated on the assumption that the Transaction was implemented on 30 June 2012. The
ZAR/USD exchange rate used to translate USD amounts is the same as the closing rate used in the most
recent published unaudited group interim results of Trencor (six months ended 30 June 2012), being
R8,24=$1.
4. In the unaudited condensed consolidated statement of comprehensive income all adjustments are
considered to have a continuing effect.
5. Adjusted HEPS is the more appropriate measure of Trencor’s financial performance in that it excludes net
unrealised foreign exchange losses and gains. Adjusted HEPS may also include such other adjustments
that, in the opinion of the Trencor Board, are necessary to properly represent adjusted HEPS.
6. The option, which Textainer has granted to the underwriters and which is exercisable for 30 days to
purchase up to an additional 1 125 000 Textainer common shares at the public offering price less the
underwriting discount, has not been taken into account in the financial effects calculation.
7. The net proceeds:
- from the Primary Placing are assumed to reduce Textainer’s debt bearing interest at an after tax rate of
3,22% per annum;
- from the Secondary Placing are assumed to earn USD interest at a before tax rate of 0,25% per
annum; and
- from the Secondary Placing are intended to be distributed to Trencor, subject to the approval of the
Halco Holdings board of directors and the trustees and protectors of the Halco Trust, in 2013. In this
regard, the Trencor board of directors will consider the most optimal use of the net proceeds, received
by Trencor, specifically possibilities around distribution to Trencor shareholders by way of a share buy-
back and/or special dividend.
4. JSE Limited Listings Requirements
The Transaction is classified as a Category 2 transaction in terms of the JSE Limited (“JSE”)
Listings Requirements. Accordingly, the Transaction is not subject to approval by
Shareholders.
As a result of the Transaction, Trencor’s existing 60,01% beneficiary interest in Textainer
dilutes to 49,94%, before taking into account the option, which Textainer has granted to the
underwriters and which is exercisable for 30 days to purchase up to an additional 1,125,000
Textainer common shares at the public offering price less the underwriting discount
(Trencor’s beneficiary interest in Textainer dilutes to 48,93% if the full option is exercised).
This beneficiary interest is Trencor’s major (albeit not only) asset and, accordingly, the
Transaction results in Trencor no longer having a 50,00%+1 beneficiary interest in its major
asset as required by Section 4.28 (d) of the JSE Listings Requirements.
Trencor has received dispensation from the JSE to retain its main board listing on the JSE,
subject to complying with certain JSE requirements, mainly securing support for the
Transaction from 2 to 3 of the largest Trencor shareholders. In this regard, Trencor has
obtained the support of 3 shareholders together holding approximately 55,81% of the
Trencor shares in issue, to dilute its beneficiary interest in Textainer, its major asset, to below
50,00%, but not below 45,00%.
The said dispensation was granted by the JSE on the basis of existing circumstances and
factors (including the fact that Textainer is listed on the NYSE), and the JSE may reconsider
the listing of Trencor if there is a material change to any of these.
By order of the board of directors
Trencor Limited
Cape Town
14 September 2012
www.trencor.net
Investment bank and transaction sponsor Corporate law adviser Sponsor
Investec Bank Limited Edward Nathan Rand Merchant
Sonnenbergs Inc. Bank
“September 13, 2012
Textainer Group Holdings Limited Announces Pricing of Offering of 7,500,000 Common
Shares
HAMILTON, Bermuda, (BUSINESS WIRE) -- Textainer Group Holdings Limited (NYSE:TGH)
(“Textainer” or the “Company”), the world’s largest lessor of intermodal containers based on fleet
size, today announced the pricing of an underwritten public offering of an aggregate of 7,500,000
of its common shares at a price to the public of $31.50 per share. Of the common shares to be
sold, the Company intends to sell 5,000,000 common shares and Halco Holdings Inc. (the “selling
shareholder”) intends to sell 2,500,000 common shares.
Textainer has granted an option to the underwriters, exercisable for 30 days to purchase up to an
additional 1,125,000 of its common shares at the public offering price, less the underwriting
discount.
The offering is expected to close on or about September 19, 2012, subject to customary closing
conditions. The Company intends to use all of the net proceeds from this offering for capital
expenditures and general corporate purposes. The Company will not receive any of the proceeds
from the sale of common shares by the selling shareholder
BofA Merrill Lynch, Wells Fargo Securities and Credit Suisse Securities (USA) LLC are acting as
joint book-running managers for the offering.
The common shares will be offered pursuant to an effective shelf registration statement filed with
the Securities and Exchange Commission ("SEC"). A copy of the preliminary prospectus
supplement and related base prospectus for the offering have been filed with the SEC and may be
obtained by visiting EDGAR on the SEC's website, www.sec.gov. Alternatively, copies of the
preliminary prospectus supplement and the related base prospectus may be obtained by
contacting: BofA Merrill Lynch, 222 Broadway, 7th Floor, New York, NY 10038, attention:
Prospectus Department, or e-mail dg.prospectus_requests@baml.com; Wells Fargo Securities,
attention: Equity Syndicate Department, 375 Park Avenue, New York, NY 10152, phone: (800)
326-5897, email: cmclientsupport@wellsfargo.com; or Credit Suisse Securities (USA) LLC,
attention: Prospectus Department, One Madison Avenue, New York, NY 10010, by calling toll-free
(800) 221-1037 or by emailing newyork.prospectus@credit-suisse.com.
This press release is for informational purposes only and is not an offer to sell or the solicitation of
an offer to buy any security of the Company nor will there be any sale of any such security in any
jurisdiction in which such offer, sale or solicitation would be unlawful. Any offer for the Company’s
common shares will be made only by means of a prospectus supplement and related base
prospectus or by a free writing prospectus in accordance with SEC rules.
Important Cautionary Information Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of U.S. securities laws.
Forward-looking statements include statements that are not statements of historical facts, and
include, but are not limited to, statements concerning the proposed offering by the Company and
the selling shareholder of the Company’s common shares and the anticipated use of proceeds
therefrom. Readers are cautioned that these forward-looking statements involve risks and
uncertainties, are only predictions and may differ materially from actual future events or results.
These risks and uncertainties include, without limitation the risks and uncertainties set forth in
Textainer’s filings with the SEC. For a discussion of some of these risks and uncertainties, see
Item 3 “Key Information—Risk Factors” in Textainer’s Annual Report on Form 20-F filed with the
SEC on March 15, 2012, as amended on June 27, 2012.
The Company's views, estimates, plans and outlook as described within this document may
change subsequent to the release of this press release. The Company is under no obligation to
modify or update any or all of the statements it has made in this press release despite any
subsequent changes that the Company may make in its views, estimates, plans or outlook for the
future.
About Textainer Group Holdings Limited
Textainer Group Holdings Limited and its subsidiaries ("Textainer") has operated since 1979 and is
the world's largest lessor of intermodal containers based on fleet size. As of the most recent
quarter end, Textainer had more than 1.7 million containers, representing more than 2.6 million
TEU, in its owned and managed fleet. Textainer leases dry freight, dry freight specialized, and
refrigerated containers. Textainer is one of the largest purchasers of new containers as well as one
of the largest sellers of used containers. Textainer leases containers to approximately 400 shipping
lines and other lessees and sells containers to more than 1,100 customers worldwide and provides
services worldwide via a network of regional and area offices, as well as independent depots.
Contact:
Textainer Group Holdings Limited
Mr. Tom Gallo, 415-658-8227
Investor Relations Director
ir@textainer.com”
Date: 14/09/2012 08:50:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
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