TIMES MEDIA GROUP LIMITED - Update Relating To Category 2 Transaction Announcement: Acquisition Of A 49% Interest In Radio Africa Limited

Update Relating To Category 2 Transaction Announcement: Acquisition Of A 49% Interest In Radio Africa Limited

Times Media Group Limited
Incorporated in the Republic of South Africa
Registration number: 2008/009392/06
Ordinary share code: TMG
ISIN code: ZAE000169272
(“TMG”) or (“the Company”)

UPDATE RELATING TO CATEGORY 2 TRANSACTION ANNOUNCEMENT:
ACQUISITION OF A 49% INTEREST IN RADIO AFRICA LIMITED IN KENYA AND
WITHDRAWAL CAUTIONARY

1.     Introduction

       Shareholders are referred to the announcement released on SENS on Friday,
       11 April 2014 (“the Announcement”), advising shareholders that an
       agreement was entered into which if successfully implemented would result in
       TMG acquiring a 49% interest in Radio Africa Group (“RAG”) (“the
       Acquisition”).

       In accordance with the Announcement, the outstanding pro forma financial
       effects of the Acquisition are disclosed below.

2.     Pro forma financial effects

       The pro forma financial effects of the Acquisition are presented for illustrative
       purposes only and because of their nature may not give a fair reflection of the
       Company’s financial position nor of the effect on future earnings after the
       Acquisition. The pro forma financial information is presented in accordance
       with the JSE Listings Requirements, the Guide on Pro Forma Financial
       Information issued by SAICA and the measurement and recognition
       requirements of International Financial Reporting Standards. The pro forma
       adjustments to the statement of financial position have been calculated on the
       assumption that the Acquisition was implemented on 31 December 2013. The
       pro forma adjustments have been calculated on the assumption that the
       Acquisition was implemented on 1 July 2013. The pro forma financial effects
       are presented in a manner that is consistent with the accounting policies of
       TMG.

       Set out below are the unaudited pro forma financial effects of the Acquisition,
       based on the unaudited condensed consolidated interim group financial
       results for the six months ended 31 December 2013. The directors of TMG
       are responsible for the preparation of the unaudited pro forma financial
       information.

                                  Unaudited       Unaudited Pro
                                  before the       Forma after
                                  Acquisition         the              Percentage
                                                   Acquisition          increase/
                                                                       (decrease)

 Headline earnings per share
 (cents)                                   196                199                   2%
 Earnings per share (cents)                375                377                   1%
 Net asset value per share
 (cents)                                 1 289              1 289                   0%
 Tangible net asset value per
 share (cents)                             597                596                  (0%)
 Number of shares in issue
 ('000)                                127 077           127 077                   Nil
 Weighted average number of
 shares in issue (‘000)                127 047           127 047                   Nil
 Number of treasury shares
 ('000)                                     30                30                   Nil

       Notes and assumptions:
       1.   The earnings per share and headline earnings per share in the
            ''Unaudited Pro forma after the Acquisition" column have been
            calculated on the basis that the Acquisition was effected on 1 July 2013.
       2.   The net asset value per share and net tangible asset value per share
            figures under the "Unaudited Pro forma after the Acquisition" column
            have been calculated on the basis that the Acquisition was effected on
            31 December 2013.
       3.   The taxation rate applicable is assumed to be 28%, and the applicable
            average KES/ZAR exchange rate is assumed to be 0,1163 and the
            applicable closing KES/ZAR exchange rate is assumed to be 0,1219.
       4.   The total purchase consideration for the Acquisition is assumed to be
            US$ 18.62 million, being ZAR 195 million, R 183 million funded from
            TMG's cash reserves at an interest rate of 2,8% per annum, and R 12
            million funded on overdraft at an interest rate of 8,5% per annum.
       5.   Transaction costs of ZAR 370 000 are assumed for the Acquisition.
            These costs are capital in nature and therefore not deductible for
            income tax purposes.
       6.   The basic earnings per share and basic headline earnings per share are
            calculated based on the weighted average number of shares in issue of
            127 047 179 for the six months ended 31 December 2013.
       7.   The net asset value per share and tangible net asset value per share
            are calculated based on 127 077 145 shares in issue at 31 December
            2013.
       8.   All adjustments, with the exception of transaction costs, are expected to
            have a continuing effect.

3.     Withdrawal of cautionary announcement

       Shareholders are referred to the cautionary announcement included in the
       Announcement and are advised that since the pro forma financial effects
       relating to the Acquisition have been disclosed in this announcement, caution
       is no longer required to be exercised by shareholders when dealing in the
       Company’s securities.

16 April 2014
Johannesburg

Sponsor:
PSG Capital

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