HOSKEN CONSOLIDATED INVESTMENTS LTD - Proposed Specific Repurchase of HCI Shares

Proposed Specific Repurchase of HCI Shares

HOSKEN CONSOLIDATED INVESTMENTS LIMITED
(Incorporated in the Republic of South Africa)
Registration number: 1973/007111/06
Share code: HCI
ISIN: ZAE000003257
(“HCI or the Company”)


PROPOSED SPECIFIC REPURCHASE OF HCI SHARES


1. INTRODUCTION


  HCI has concluded an agreement (“Share Buy-Back Agreement”) with Andre van der Veen, a
  director of various subsidiaries of HCI, in terms of which HCI will acquire 220,000 HCI shares
  from Mr van der Veen, subject to the terms and conditions referred to below, at a price of R123.00
  per HCI share (the “Specific Repurchase”).


2. RATIONALE FOR THE SPECIFIC REPURCHASE


  The specific repurchase, at the repurchase price of R123.00 per HCI share, is earnings accretive
  to shareholders and is an efficient use of HCI’s excess cash.


  The repurchase price of R123.00 per share represents a discount of:
  -   6.3% to the closing price; and
  -   4.8% to the 30 day volume weighted average price (“VWAP”);
  on 30 September 2013, being the last business day preceding this announcement.


3. TERMS OF THE SPECIFIC REPURCHASE


  HCI has agreed to acquire 220,000 HCI shares from Mr van der Veen for R123.00 per HCI share
  and an aggregate purchase consideration of R27 060 000 subject to the conditions precedent set
  out below.


  The Share Buy-Back Agreement is subject to the fulfilment of the following conditions precedent
  prior to 31 March 2014 (or such later date as the parties agree in writing):
  -   the obtaining of the approval of the JSE of the documentation to be issued to HCI
      shareholders to approve the Specific Repurchase;
  -   the passing by HCI shareholders of the resolutions required to authorise, approve and
      implement the Specific Repurchase in terms of the Companies Act, HCI’s Memorandum of
      Incorporation and the Listings Requirements of the JSE Limited;
  -   the obtaining of the approval of and authority to implement the Specific Repurchase by the
      board of directors of HCI;
  -   HCI satisfying the solvency and liquidity test contemplated in section 4 of the Companies Act
      in respect of the Specific Repurchase; and
  -   the obtaining of such regulatory approvals as may be necessary in respect of the Specific
      Repurchase.


  The repurchase of the HCI shares and the payment of the purchase consideration in terms of the
  Specific Repurchase will take place on the third business day after the fulfilment of the last of the
  conditions precedent referred to above (“Repurchase Date”). The HCI shares repurchased will be
  cancelled and their listing terminated on or, as soon as possible after, the Repurchase Date. After
  the Specific Repurchase, HCI will hold 11,000,000 HCI shares in treasury.


  In terms of the Listings Requirements the specific repurchase is a related party transaction as Mr
  van der Veen is a director of various subsidiaries of HCI, and is consequently a related party to
  HCI. Consequently in terms of the Listings Requirements, in order to implement the specific
  repurchase a special resolution of the Company must be passed by securities holders excluding
  Mr van der Veen. As the purchase price of R123.00 per share is at a discount to the 30 day
  VWAP, a fairness opinion is not required.


  In terms of the Listings Requirements, the votes of Mr van der Veen will be taken into account in
  determining whether a quorum of shareholders is present at the general meeting, but such votes
  will not be taken into account in determining the results of the voting at the general meeting.


4. FINANCIAL EFFECTS


  The pro forma financial effects in relation to the Specific Repurchase are not material.


5. FURTHER ANNOUNCEMENTS


  A circular, including a notice of general meeting, detailing the terms of the Specific Repurchase
  and actions required by shareholders will be posted to shareholders on or about Wednesday, 30
  October 2013. It is expected that the general meeting will be held on or about Friday, 29
  November 2013.


Cape Town
2 October 2013


Investment Bank
Investec Bank Limited


Sponsor
Investec Bank Limited


Legal advisers
Tabacks

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