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Barlworld Limited - Small related party acquisition
Barloworld Limited
(Incorporated in the Republic of South Africa)
(Registration number 1918/000095/06)
(Share code: BAW)
(JSE ISIN: ZAE000026639)
(Share code: BAWP)
(JSE ISIN: ZAE000026647)
(Bond issuer code: BIBAW)
(“Barloworld” or “the Company”)Barloworld Limited
ACQUISITION BY BARLOWORLD LOGISTICS (PROPRIETARY) LIMITED (A
WHOLLY OWNED SUBSIDIARY OF BARLOWORLD LIMITED)(“BWL”) OF THE
REMAINING 25% STAKE IN BARLOWORLD LOGISTICS AFRICA (PROPRIETARY)
LIMITED (“BLA”) FROM OLD PRIORY INVESTMENTS (PROPRIETARY) LIMITED
(“OLD PRIORY”) (“THE TRANSACTION”)
1. Introduction and rationale
In 2005, BWL entered into an empowerment transaction with Old
Priory. In terms of this initial transaction, BWL sold 25% of the
shares and claims in BLA to Old Priory and Barloworld provided
security for the required loan funding.
The shareholders in BLA have decided to enter into a Sale of
Shares and Claims agreement whereby BWL will acquire the interests
of Old Priory in BLA. This Transaction will unlock value for the
minority shareholders at the end of the seven year funding term
and provides a platform for growing BLA.
The Transaction will be funded from existing funding facilities.
2. The consideration and conditions precedent
The cash consideration of R125,000,000.00 for the shares will be
settled on closing of the Transaction which is expected around 1
October 2012. In addition, the loan funding of R50,242,884.93
(capital and interest) will be settled with Nedbank on 2 October
2012.
The following are the conditions precedent to the Transaction:
1. The approval of the Transaction by Old Priory in terms of
a special resolution of the shareholders of Old Priory in
accordance with section 115 of the Companies Act 71 of
2008.
2. Obtaining of all consents and approvals required for the
entering into and implementation of the Transaction in
terms of the JSE Listings Requirements (“Listings
Requirements”) of the JSE Limited.
3. Undertaking from Nedbank that payment of the loan funding
by BWL on 2 October 2012 will constitute full and final
settlement of all amounts due by Old Priory arising from
the Nedbank loan funding, and that Barloworld is released
from its obligations in terms of the original loan funding
agreement.
3. Pro forma financial effects
In terms of the Listings Requirements, the effects of the
Transaction are not significant and are below the reporting
threshold.
4. Categorisation and related party
Mr Isaac Shongwe, a director of Barloworld, is a shareholder of
Old Priory and in addition Old Priory is a material shareholder in
BLA (a subsidiary of BWL), therefore the transaction is a related
party transaction as defined in the Listings Requirements. The
Transaction is classified as a small related party transaction.
5. Independent Expert
In terms of Section 10.7 of the Listings Requirements the Company
has appointed PricewaterhouseCoopers Corporate Finance as the
independent professional expert in order to provide an opinion on
the fairness of the transaction.
A further announcement in this regard will be released in due
course.
Sandton
25 September 2012
Legal advisors: Bowman Gilfillan
Sponsor: J.P. Morgan Equities Limited
Independent expert: PricewaterhouseCoopers Corporate Finance (Pty)
Ltd
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