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Extension of return date for rule nisi, proposed acquisition, section 60 notice to shareholders & cautionary renewal
BIOSCIENCE BRANDS LIMITED (IN PROVISIONAL LIQUIDATION)
(Incorporated in the Republic of South Africa)
(Registration number 2005/005805/06)
(JSE code: BIO ISIN: ZAE000115036)
(“BioScience” or “the Company”)
EXTENSION OF RETURN DATE FOR RULE NISI, PROPOSED ACQUISITION, NOTICE OF
SUBMISSION OF PROPOSED SPECIAL AND ORDINARY RESOLUTIONS TO SHAREHOLDERS IN
TERMS OF SECTION 60 OF THE COMPANIES ACT, 71 OF 2008, AS AMENDED (“COMPANIES
ACT”) AND RENEWAL OF CAUTIONARY ANNOUNCEMENT
1. UPDATE ON PROVISIONAL LIQUIDATION
Shareholders are advised that the High Court of South Africa, Gauteng
Division has extended the return date of the Rule Nisi to 17 November
2014 pending the finalisation of negotiations for the acquisition by
independent third parties of all creditors’ claims in BioScience and
the acquisition by the Company of a 51% share in Aonghus Finance (Pty)
Ltd (“Aonghus Finance”).
2. PROPOSED ACQUISITION AND NOTICE IN TERMS OF SECTION 60 OF THE COMPANIES
ACT
2.1 Background
The Provisional Liquidator, working in conjunction with the
directors of BioScience, has entered into negotiations with the
Uisce Beatha Trust acting jointly with the Jabulani Trust, which,
if successfully concluded, will result in the existing claims of
creditors being purchased by these independent third parties, the
injection of new assets into BioScience by parties associated with
the Uisce Beatha and Jabulani Trusts and the removal of the
Company from provisional liquidation (“the proposed
transactions”).
In line with the implementation of the proposed transactions, the
Uisce Beatha Trust acting jointly with the Jabulani Trust will
make an Offer to Purchase the claims of creditors of the Company
(“the Creditors Offer”), subject to the following suspensive
conditions:
- the Company concluding an agreement for the purchase of a 51%
interest in Aonghus Finance from C Lauryssen (“the vendor”)
for a purchase consideration of R1 745 000, by way of an
issue of 1 745 000 000 ordinary shares (or 1 745 000 shares
if after the consolidation of the share capital proposed
below) at a price of 0.01 cents per share. The shares to be
issued in settlement of the purchase price represent 34.9% of
the issued share capital of BioScience;
- the Company consolidating its existing share capital on a
1000:1 basis in order to reduce the excessive number of
shares currently in issue;
- the share capital of the Company being converted from shares
with a par value of R0.0001 each to shares of no par value;
and
- the authorised share capital post consolidation being
increased from 5 000 000 shares of no par value to
200 000 000 shares of no par value.
Shareholders are notified that the provisional liquidator and the
board of directors has resolved to propose that shareholders
consider and, if deemed fit, pass the resolutions required to
implement the changes to the share capital of the Company (the
“resolutions”) by written consent in terms of section 60 of the
Companies Act.
The section 60 notice of the resolutions (the “notice”) was sent
to shareholders of the Company on Thursday, 25 September 2014 and,
in order for the special and ordinary resolutions (“the
resolutions”) contained in the notice to be adopted, such
resolutions will need to be approved in writing by shareholders
holding sufficient voting rights for each proposed resolution to
be adopted as a special or ordinary resolution (as the case may
be) by no later than 23 October 2014.
2.2 CONSOLIDATION OF THE SHARE CAPITAL ON A 1000:1 BASIS, THE
CONVERSION OF THE EXISTING PAR VALUE SHARES TO SHARES OF NO PAR
VALUE AND AN INCREASE IN POST-CONSOLIDIATION AUTHORISED SHARE
CAPITAL
2.2.1 Rationale for the consolidation of the share capital on a 1000:1
basis
BioScience currently has 3 081 425 147 ordinary shares in issue.
The parties with whom BioScience is currently negotiating are of
the opinion that this is an excessive number of shares to have
in issue, that such a large number of issued shares leads to
instability in the share price and that reducing the number of
issued shares will result in a narrowing of the high percentage
bid-offer spread, which, in turn, will make the Company’s
shares, once unsuspended, more attractive to potential
investors.
2.2.2 Rationale for the increase in authorised share capital and the
conversion of the ordinary shares to shares of no par value
As noted above, the successful conclusion of the negotiations in
which the Company is currently engaged is subject to a number of
suspensive conditions, including, inter alia, the conversion of
the existing shares with a par value of 0.0001 cents each into
shares of no par value and an increase in the post consolidation
number of authorised shares from 5 000 000 shares to 200 000 000
ordinary shares of no par value.
The Regulations to the Companies Act, 2008 prevent a company
from creating any new par value shares and the Company is thus
required to convert the existing authorised and issued share
capital from shares with a par value of 0.0001 cents to shares
of no par value prior to increasing the authorised share
capital.
2.3 AUTHORITY TO ISSUE ORIDNARY SHARES THAT WILL EXCEED 30% OF THE
VOTING POWER OF THE CURRENT ISSUED ORDINARY SHARE CAPITAL
In order to enable the Company to implement the proposed Aonghus
Finance acquisition, it will need to obtain the approval of
shareholders, in accordance with sections 41(1) and 41(3) of the
Companies Act, to issue additional ordinary shares in the
authorised but unissued share capital of the Company which will
be in excess of 30% of the voting power of the current issued
ordinary share capital. A resolution to this effect is included
in the notice.
2.4 APPROVAL OF RESOLUTIONS PROPOSED IN THE NOTICE
Shareholders will be advised of the results of the voting on the
resolutions proposed in the notice as soon as the Company has
received written consents approving the resolutions from persons
entitled to exercise the required number of voting rights on the
resolutions or on 24 October 2014, being the day after the 20
business days in which shareholders have to vote on the proposed
resolutions has expired, whichever happens sooner.
3 RENEWAL OF CAUTIONARY ANNOUNCEMENT
Shareholders are advised to continue to exercise caution when dealing
in the Company’s shares until such time as a further announcement
relating to the proposed acquisition of creditors' claims, the
proposed acquisition of Aonghus Finance and the outcome of the rule
nisi in respect of the application for the liquidation of the Company,
is made.
Johannesburg
6 October 2014
Designated Advisor
Arbor Capital Sponsors Proprietary Limited
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