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DLV - Dorbyl - Disposal By Dorbyl Of The Property Situated In Korsten (Port
Elizabeth) And An Update On The Disposal Of The Dorbyl Automotive Systems
("DAS") Business
DORBYL LIMITED
(Incorporated in the Republic of SA)
(Registration Number 1911/001510/06)
(Share Code: DLV & ISIN: ZAE000002184)
("Dorbyl", "the company" or "the Group")
DISPOSAL BY DORBYL OF THE PROPERTY SITUATED IN KORSTEN (PORT ELIZABETH) AND AN
UPDATE ON THE DISPOSAL OF THE DORBYL AUTOMOTIVE SYSTEMS ("DAS") BUSINESS
1. THE DISPOSALS
The Korsten property disposal
1.1 Further to the cautionary announcement released on SENS and in the press
on 28 August 2008 and last renewed on 18 February 2009, shareholders are
advised that Dorbyl has entered into an agreement dated 13 March 2009
("the agreement") whereby it will dispose of the property situated in
Korsten Port Elizabeth, to Slip Knot Investments 777 (Pty) Limited ("the
purchaser") ("the Korsten property disposal").
Update on the DAS disposal
1.2 As was announced on SENS and in the press on 20 October 2008, Dorbyl has
entered into an agreement to dispose of the assets and liabilities of its
Dorbyl Automotive Systems Division to Red Tape Trading (Pty) Limited
effective 2 February 2009 ("the DAS disposal"). The DAS disposal
consideration comprised an amount of R7,6 million in respect of the fixed
assets plus an amount to be determined for the net working capital of DAS
as at 2 February 2009 ("the effective date"). Shareholders are hereby
informed that due to the delay in the approval of the disposal by the
Competition Commission, which approval has now been received, the
effective date of the DAS disposal has been amended to 1 April 2009.
2. RATIONALE FOR THE KORSTEN PROPERTY DISPOSAL
As indicated in the cautionary announcement of 28 August 2008 referred to
above, those properties which are considered surplus to the requirements
of the Group, would either be rented out or disposed of. The Korsten
property is considered surplus to the operational requirements of the
Group and accordingly the decision was taken by the board to sell it.
3. DISPOSAL CONSIDERATION AND APPLICATION THEREOF
3.1 The disposal consideration in respect of the Korsten Property disposal
amounts to R36 million ("the disposal consideration").
3.2 The disposal consideration will be settled against registration of
transfer of the property into the name of the purchaser.
3.3 As the disposal consideration will only be received on registration of
the property into the name of the purchaser, the Board will determine,
depending on the needs of Dorbyl, the optimum utilisation of the proceeds
at such time.
4. FINANCIAL EFFECTS
4.1 The unaudited pro forma financial effects on Dorbyl before and after the
Korsten disposal and the other disposals, set out in the table below, are
the responsibility of the company`s directors and have been prepared for
illustrative purposes only to show how the Korsten disposal and the other
disposals may have affected Dorbyl`s results for the six month period
ended 30 September 2008, based on the assumptions that:
4.1.1 for purposes of the earnings and headline earnings per share
calculations, the Korsten disposal and the other disposals were
effective from the beginning of the six month period ended
30 September 2008; and
4.1.2 for purposes of the net asset value and net tangible asset
value per share calculations, the Korsten disposal and the
other disposals were effected on 30 September 2008.
4.2 It should be noted that the unaudited pro forma financial effects have
been prepared on Dorbyl`s latest six month results taking into
consideration the Korsten disposal and the other disposals and because of
their nature, may not fairly reflect Dorbyl`s financial performance and
position after the the Korsten disposal and the other disposals.
Unaudited Pro forma Pro forma
Before(1) After the After the Net change
other other
disposals(2) disposals and
the Korsten
disposal(3)
(cents) (cents) (cents) (%)
Loss per (240.9) (299.4) (218.4) 9,3
share(4)
Headline loss (115.5) (111.7) (108.1) 6,4
per share(4)
Net asset 941 879 956 1,6
value per
share(5)
Tangible net 941 879 956 1,6
asset value
per share(5)
Weighted 33 924 33 924 33 924 -
average number
of shares in
issue (`000)
Actual number 33 924 33 924 33 924 -
of shares in
issue (`000)
Notes
(1) Extracted from the published unaudited interim financial statements
of Dorbyl for the six month period ended 30 September 2008.
(2) Adjustments to reflect the aggregate once-off effects of the other
disposals, namely:
a. in respect of the Rosslyn property disposal: disposal
consideration of R14,000k, book value of the fixed asset sold
of R3,086k as at 30 September 2008, interest earned at an after-
tax return of 10% totalling R700k for the six months ended 30
September 2008; and
b. in respect of the DAS disposal: total disposal consideration
of R14,151k which is based on management`s best estimate of the
carrying value of the net working capital of R6,562k as at 1
April 2009 and R7,589k in respect of the fixed assets. Book
value of fixed assets sold of R23,313k, the carrying value of
inventories of R39,577k, trade and other receivables of
R55,137k and trade and other payables of R71,825k as at
30 September 2008 and interest earned at an after-tax return of
10% totalling R708k for the six months ended 30 September 2009.
(3) Adjustments to reflect the once-off effects of the Korsten disposal,
namely: disposal consideration of R36,000k, book value of the fixed
asset sold of R9,760k as at 30 September 2008, interest earned at an
after-tax return of 10% totalling R1,800k for the six months ended
30 September 2009 and transaction costs of R560k.
(4) Calculation based on a weighted average of 33,924 million shares in
issue during the six month period ended 30 September 2008.
(5) Calculation based on 33,924 million shares in issue at
30 September 2008.
5. CONDITION PRECEDENT
The disposal is subject to, Dorbyl obtaining the necessary regulatory and
shareholder approval for the disposal in a general meeting (see
paragraph 6 below).
6. DOCUMENTATION AND CATEGORISATION
In terms of the JSE Limited ("JSE") Listing Requirements, the Korsten
property disposal is deemed to be a Category 1 transaction, requiring
shareholder approval. Accordingly, a circular to shareholders setting
out the terms of the disposals and convening a general meeting will,
subject to approval by the JSE, be mailed to Dorbyl shareholders within
28 days of this announcement.
7. CONTINUATION OF CAUTIONARY
Further to the cautionary announcements released on SENS last year and
renewed on 21 January 2009 and 18 February 2009, Dorbyl shareholders are
advised to continue exercising caution when dealing in Dorbyl shares on
the JSE.
Johannesburg
20 March 2009
Sponsor: PSG Capital (Pty) Limited
Date: 20/03/2009 15:30:02 Supplied by www.sharenet.co.za
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