TIMES MEDIA GROUP LIMITED - Disposal of Nu Metro Cinemas, a Division of TMG, and Avusa Entertainment Investments (Pty) Limited

Disposal of Nu Metro Cinemas, a Division of TMG, and Avusa Entertainment Investments (Pty) Limited

TIMES MEDIA GROUP LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2008/009392/06)
Ordinary Share Code: TMG
Ordinary share ISIN: ZAE000169272
(“TMG” or “the Company”)

DISPOSAL OF NU METRO CINEMAS, A DIVISION OF TMG, AND AVUSA
ENTERTAINMENT INVESTMENTS (PTY) LIMITED

1.   INTRODUCTION

     Shareholders are advised that the Company has concluded an
     agreement, in terms of which it has disposed of its Nu Metro
     Cinema division (“Nu Metro”) and its associated cinema
     advertising business Popcorn Cinema Advertising Sales which
     is the sole operating business of Avusa Entertainment
     Investments   (Pty)  Limited   (“Popcorn   Advertising”)   to
     Subcocept (Pty) Limited (“Subcocept”) a purpose built company
     funded by private equity company, One Fifty Capital (“the
     Disposal”).

     One Fifty Capital is an independent private equity firm
     providing capital for small to medium start-up enterprises in
     the property, education, entertainment and gaming industries
     with offices in KwaZulu-Natal, South Africa and Nicosia,
     Cyprus.   For   more    information,   please   log   on   to
     www.onefiftycapital.com

2.   RATIONALE FOR THE DISPOSAL

2.1.   As part of TMG’s turnaround strategy, it has specifically
       decided to exit non-core businesses identified within TMG.
       One such business is Nu Metro, which falls within the
       Company’s Entertainment division and which forms the
       subject matter of the Disposal.

2.2.   Nu Metro is the 2nd largest cinema operator in Southern
       Africa and operates 17 cinema complexes with 162 screens
       across  South   Africa  and   this  business  represents
       approximately one third of the cinema market share in South
       Africa, claiming 4 of the top 10 screens by attendance.

2.3.   Popcorn Advertising sells on-screen advertising space on
       behalf of Nu Metro as well as the major independent cinemas
       across South Africa, to media agencies and some clients
       directly.

3.   DETAILS OF THE DISPOSAL

3.1.   Purchase Consideration

3.1.1.   TMG will dispose of 100% of Nu Metro and Popcorn
         Advertising for a purchase consideration of R75 000 000
         (seventy five million rand) payable in cash. R50 million
         will be paid on the implementation on the transaction;
         R15 million on the first anniversary of the transaction
         and R10 million on the second anniversary of the
         transaction.

3.1.2.   The proceeds of the Disposal will be used to reduce
         acquisition leverage with respect to future acquisitions
         more aligned to TMG’s core business.

3.2.   Previous Cinema sales

3.2.1.   As announced previously TMG has also sold the following
         Cinema assets:

3.2.1.1.    51% shareholding in Monte Cinemas (Pty) Limited to
            Tsogo Sun Casinos (Pty) Limited for R20 million cash;
            and

3.2.1.2.    50% shareholding in Three Groups Cinemas (Pty)
            Limited to Whitehorse Investments (Pty) Limited and
            Avalon Three Groups Investments (Pty) Limited for R18
            million in cash.

3.2.2.   Accordingly the total sale proceeds for the entire TMG
         cinema assets as described above amounts to R113 million.
By order of the board

6 January 2014
Johannesburg

Sponsor
PSG Capital

Date: 06/01/2014 09:05:00 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.