RARE HOLDINGS LIMITED - Cautionary announcement: Proposed acquisition of property and assets

Cautionary announcement: Proposed  acquisition of property and assets

RARE HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
Registration Number: 2002/025247/06
Share Code: RAR    ISIN: ZAE000092714
("the Company" or "RARE")

CAUTIONARY ANNOUNCEMENT: PROPOSED ACQUISITION OF PROPERTY AND
ASSETS

1.   INTRODUCTION

     Shareholders are advised that the Rare Group Proprietary
     Limited, being a wholly owned subsidiary of RARE, has reached
     agreement in principle with the joint liquidators of
     Hollyberry Props 4 Proprietary Limited (“Hollyberry”),
     Gazelle Plastics Proprietary Limited (“Gazelle”) and First
     Strut (RF) Limited (“First Strut”) in relation to the
     acquisition of:

     - the property situated at 4 Meyer Road, Meyerton, being Erf
       1061, Meyerton Extension 3 (“the  Property”), from
       Hollyberry ; and
     - the fixed assets situated on the Property and that were
       used by First Strut and Gazelle Plastics (in the
       businesses that were carried on under the name and style
       “FT-Piping  Manufacturing   Division” and/or  “Gazelle
       Plastics”) for purposes of manufacturing High Density
       Polyethylene (HDPE) pipes, from First Strut and
       Gazelle(“Sale Assets”),

     (the proposed acquisition of the Property and the Sale Assets
     hereinafter referred to as “the Acquisitions”).

2.   RATIONALE FOR THE ACQUISITION

     Should the Acquisitions be successfully implemented, it will
     enable RARE to manufacture HDPE pipes up to 1000 mm in
     diameter for the mining, infrastructure, agricultural and
     industrial markets.

     Rare has also appointed Tony Dean, a very well known plastic
     pipe industry leader, as Managing Director of the new pipe
     manufacturing division of Rare. Tony has over thirty years
     industry experience and brings a wealth of knowledge to the
     business.

3.   SALE OF PROPERTY AGREEMENT

     3.1.   The purchase consideration for the Property amounts to
            R13 000 000 (thirteen million Rand) plus value added
            tax (“the Property Purchase Consideration”).

4.   PURCHASE AGREEMENT IN RESPECT OF THE SALES ASSETS

     4.1.   The purchase consideration for the Sale Assets amounts
            to R17 900 000 (seventeen million nine hundred thousand
            Rand) plus value added tax (“the Sale Assets Purchase
            Consideration”).

5.   EFFECTIVE DATE AND CONDITIONS PRECEDENT

     5.1.   The Company anticipates that the final definitive
            agreements will be signed by the all parties on or
            about Monday, 4 November 2013 (“the Effective Date”),
            whereafter such agreements will become effective and
            there being no outstanding conditions precedents (save
            for the usual conveyancing procedures associated with
            the transfer of the Property).

     5.2.   It should however be noted that, although the
            agreements giving effect to the Acquisitions become
            effective on the Effective Date, the agreements, and
            accordingly the Acquisitions, are inter-conditional and
            that either party will be entitled to cancel the Sale
            of Assets Agreement as a result of termination or
            cancellation of the Sale of Property Agreement.

6.   CATEGORISATION

     The   Acquisitions,  combined,   constitute   a  category   2
     transaction in terms of the JSE Listings Requirements and
     accordingly does not require approval by RARE shareholders.

7.   PRO FORMA FINANCIAL EFFECTS

     The pro forma financial effects of the Acquisitions on RARE’s
     net asset value and tangible net asset value are not
     significant and have therefore not been presented.

8.   CAUTIONARY

     8.1. Shareholders are advised to exercise caution when
          dealing in the Company’s securities until a further
          announcement is made, as the conclusion of the
          Acquisitions may have a material effect on the price of
          the Company’s securities.

     8.2. A further announcement will be made after the final
          agreements have been signed, expected to be on or about
          4 November 2013.



Johannesburg
1 November 2013

Designated Advisor:   PSG Capital Proprietary Limited

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