ERBACON INVESTMENT HOLDINGS LIMITED - Update on Status of Major Operating Subsidiary and Further Cautionary Announcement

Update on Status of Major Operating Subsidiary and Further Cautionary Announcement

Erbacon Investment Holdings Limited
Incorporated in the Republic of South Africa
(Registration number: 2007/014490/06)
Share code: ERB
ISIN: ZAE000111571
(“Erbacon” or “the Company”)

UPDATE ON STATUS OF MAJOR OPERATING SUBSIDIARY AND FURTHER
CAUTIONARY ANNOUNCEMENT

1.   Result of Meeting of Creditors

     1.1   Shareholders are referred to the announcement issued
           on 20 September 2013 notifying them of a meeting whereat
           the business rescue practitioner of Civcon Construction 
           (Pty) Limited (“Civcon”) (Erbacon’s major operating 
           subsidiary), presented his business rescue plan for the
           consideration and adoption by creditors (“the Civcon 
           Business Rescue Plan”).

     1.2   Shareholders are advised that the Civcon Business Rescue 
           Plan was accepted and approved by creditors.

2.   Exercise of Security over Civcon Shares

     2.1   Shareholders are referred to the announcements issued
           on 07 February 2013 and 28 March 2013 notifying them
           that all of the shares in the Company’s subsidiaries
           had been provided as security for financial facilities
           made available by the Company’s major guarantee
           provider.

     2.2   With respect to the shares of Civcon, the Company’s
           major guarantee provider has indicated to the Company
           that it will exercise its rights over the shares in
           Civcon (“Civcon Shares”). The value to be realized by
           the Company on the transfer of the Civcon Shares is
           currently under negotiation.

     2.3   Subsequent to the exercise of the security over the
           Civcon Shares by the major guarantee provider, the
           Civcon Business Rescue Plan envisages the further
           transfer of the Civcon Shares to a consortium of new
           shareholders.

     2.4   The net effect of the above transactions is likely to
           result in a material decrease in the net tangible asset
           value of the Company compared to the 5 cents per share
           as at the last year-end of the Company, being 28 February 
           2013.

3.   Further Cautionary Announcement

     Until an announcement is made in respect of the transfer
     terms of the shares in Civcon, shareholders are advised to
     continue exercising caution when dealing in the company’s
     securities.


Johannesburg
2 October 2013

Sponsor
PSG Capital (Pty) Limited

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