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Odd-Lot Offer And Notice Of General Meeting
KAAP AGRI LIMITED
(Incorporated in the Republic of South Africa)
(Registration number: 2011/113185/06)
Share code: KAL
ISIN: ZAE000244711
(“KAL” or the "Company”)
ODD-LOT OFFER AND NOTICE OF GENERAL MEETING
1. INTRODUCTION AND RATIONALE
1.1. As at 7 February 2023, KAL had approximately 14 777 ordinary shareholders
(“Odd-lot Holders”) each holding less than 100 KAL ordinary shares of no par value
(“KAL Shares”). At that date, these Odd-lot Holders held a total of 312 942 KAL
Shares, representing 0.42% of the total issued share capital of the Company. To
reduce the administrative time and costs associated with this large number of Odd-lot
Holders, the board of directors of the Company (“Board”) proposes the
implementation of an odd-lot offer (“Odd-lot Offer”) to facilitate the reduction in these
Odd-lot Holders in a fair manner, which will result in the repurchase by the Company
of the Odd-lot holdings from the Odd-lot Holders at the offer price, being the volume
weighted average traded price of a KAL Share on the JSE Limited over the thirty
trading days immediately prior to the general meeting (“General Meeting”), due to be
held on Thursday, 30 March 2023 (“Offer Price”).
1.2. The Odd-lot Offer will provide Odd-lot Holders with the ability to dispose of their
Odd-lot holdings on a cost-efficient basis and will provide liquidity for those Odd-lot
Holders who elect to sell their Odd-lot holdings or who make no election. For KAL it
will, inter alia, reduce the complexity and ongoing administration costs associated
with a significantly larger shareholder base, including a sizeable number of Odd-lot
Holders.
2. KEY TERMS OF THE ODD-LOT OFFER
2.1. Odd-lot Offer mechanics
2.1.1. Following receipt of shareholder approval at the General Meeting, the Odd-lot
Offer will open and, if you are an Odd-lot Holder, you must decide to either:
2.1.1.1. sell your Odd-lot Holding to KAL at the Offer Price; or
2.1.1.2. retain your Odd-lot Holding.
2.1.2. If you wish to retain your KAL Shares, you must specifically make an election to
do so.
2.1.3. Those Odd-lot Holders who do not make an election by 12:00 pm on Friday,
21 April 2023 will automatically be regarded as having accepted the Odd-lot
Offer and chosen to dispose of their KAL Shares to the Company and will
receive the cash consideration, being their Odd-lot holding multiplied by the Offer
Price (“Cash Consideration”).
2.2. Transaction costs and tax
2.2.1. The transfer costs of Odd-lot Holders who sell their holdings to KAL will be borne
by KAL.
2.2.2. KAL, by proposing the Odd-lot Offer, is therefore making it possible for the
Odd-lot Holders who wish to dispose of their shareholding to do so in a
cost-effective manner.
2.2.3. The Cash Consideration payable to Odd-lot Holders will constitute a “dividend”
as defined in section 1 of the Income Tax Act, No. 58 of 1962, as amended
(“Income Tax Act”). The Cash Consideration will give rise to a liability for
dividends tax in accordance with the Income Tax Act in the event that any
Odd-lot Holder does not qualify for an exemption from the dividends tax.
2.2.4. In the event that any Odd-lot Holder does not qualify for an exemption from the
dividends tax, KAL will withhold the relevant portion from the Cash Consideration
in relation to a particular Shareholder in order to make payment of such liability
for dividends tax.
2.2.5. The implementation of the Odd-lot Offer will not result in a reduction of the
contributed tax capital of the Company.
2.2.6. The summary of the tax considerations pertaining to the Odd-lot Offer is based
on the current laws that are applicable as at the date of this Circular and is
subject to potential changes that may be made to such legislation subsequently,
which could be retrospective. The summary is a general guide and is not
intended to constitute a complete analysis of the tax consequences of the
Odd-lot Offer provisions in terms of South African tax law. It is not intended to be,
nor should it be considered as legal or tax advice. KAL and its advisors cannot
be held responsible for the tax consequences of the Odd-lot Offer and therefore
Shareholders are advised to consult their own tax advisors in this regard.
2.2.7. The Odd-lot Offer may be subject to tax in the relevant jurisdiction of the Odd-lot
Holders arising from the disposal of the Odd-lot holdings by the Odd-lot Holders
who make an election to sell their respective Odd-lot holdings to KAL, or who do
not make an election in the case of Odd-lot Holders.
2.3. Financial effect
2.3.1. The repurchase of Shares pursuant to the Odd-lot Offer will have no significant
effect on KAL’s earnings per Share, headline earnings per Share, net asset
value per Share or tangible net asset value per Share.
2.3.2. Based on current shareholdings and an assumed KAL share price of R42.73,
and assuming that 312 942 Shares are repurchased in terms of the Odd-lot Offer, the
cost of the Odd-lot Offer for KAL is expected to amount to approximately R13
372 012 (excluding transfer costs), plus transaction costs of approximately R716
000 excluding VAT.
2.3.3. All Shares repurchased in terms of the Odd-lot Offer will be cancelled, with the
result that the number of treasury shares held by the Company
(currently 4 258 183) will remain unchanged.
3. DISTRIBUTION OF CIRCULAR AND NOTICE OF GENERAL MEETING
3.1. The Board is seeking approval from Shareholders to implement the Odd-lot Offer and
is therefore convening the General Meeting to be conducted entirely by electronic
communication on Thursday, 30 March 2023 at 10:00 am.
3.2. A circular (“Circular”) containing details of the Odd-lot Offer, together with a notice of
General Meeting, is being distributed to Shareholders today, 28 February 2023.
3.3. The Circular is available in English. Copies may be obtained during normal business
hours from the registered office of the Company and from the offices of the
Company’s Transaction Advisor and Sponsor, PSG Capital, from Tuesday,
28 February 2023 until Thursday, 30 March 2023 (both days inclusive). A copy of the
Circular will also be available on the Company’s website
(https://www.kalgroup.co.za/investors/reports).
3.4. Unless otherwise indicated, capitalised words and terms contained in this
announcement shall bear the same meanings ascribed thereto in the Circular.
4. SALIENT DATES AND TIMES
2023
Record date to determine which Shareholders are entitled to Friday, 17 February
receive the Circular
Circular and notice of General Meeting distributed to Shareholders Tuesday, 28 February
on
Announcement regarding distribution of the Circular and notice of Tuesday, 28 February
General Meeting released on SENS on
Announcement regarding distribution of the Circular and notice of Wednesday, 1 March
General Meeting published in the press on
Last day to trade in order to be eligible to attend and vote at the Monday, 20 March
General Meeting
Record date to determine which Shareholders are entitled to attend Friday, 24 March
and vote at the General Meeting
For administrative purposes, the time and date by which Forms of Tuesday, 28 March
Proxy for the General Meeting are requested to be lodged, by
10:00 am on
Forms of Proxy (grey) not lodged timeously with Computershare, Thursday, 30 March
for convenience, to be emailed to Computershare (who will provide
same to the chairman of the General Meeting) before the proxy
exercises the rights of the Shareholder at the General Meeting on
General Meeting to be held at 10:00 am on Thursday, 30 March
Finalisation announcement, including the results of the General Thursday, 30 March
Meeting and the final Offer Price, announced on SENS on
Finalisation announcement published in the press on Friday, 31 March
Odd-lot Offer opens at 09:00 am Friday, 31 March
Last day to trade in order to participate in the Odd-lot Offer Tuesday, 18 April
Shares trade “ex” the Odd-lot Offer on Wednesday, 19 April
Forms of Election and Surrender for the Odd-lot Offer (blue) to be Friday, 21 April
received by Computershare by 12:00 pm on
Odd-lot Offer closes at 12:00 pm on Friday, 21 April
Record date for the Odd-lot Offer (to determine which Friday, 21 April
Shareholders are entitled to participate in the Odd-lot Offer) at
close of business on
Implementation of the Odd-lot Offer on Monday, 24 April
Dematerialised Odd-lot Holders who have accepted the Odd-lot Monday, 24 April
Offer or are deemed to have accepted the Odd-lot Offer will have
their accounts held at their CSDP or broker credited with the Offer
Price on
Payments of the Offer Price to certificated Odd-lot Holders who Monday, 24 April
have accepted the Odd-lot Offer on
Results of the Odd-lot Offer released on SENS on Monday, 24 April
Results of the Odd-lot Offer published in the press on Tuesday, 25 April
Cancellation and termination of listing of KAL Shares repurchased Friday, 28 April
in terms of the Odd-lot Offer expected on or about
Notes:
1. The above dates and times are subject to change. Any changes will be published on
SENS.
2. Shareholders should note that as transactions in KAL Shares are settled in the
electronic settlement system used by Strate, settlement of trades takes place three
Business Days after such trades. Therefore, Shareholders who acquire KAL Shares
after close of trade on Monday, 20 March 2023 will not be eligible to attend, participate
in and vote at the General Meeting.
3. All times quoted in this announcement are local times in South Africa.
4. Dematerialised Odd-lot Holders are requested to notify their duly appointed CSDP or
broker of their election by the cut-off time stipulated by their CSDP or broker. This will be
an earlier date than the closing of the Odd-lot Offer.
5. In the case of certificated Odd-lot Holders who accept the Odd-lot Offer or are deemed
to have accepted the Odd-lot Offer, payment will be made by electronic funds transfer
into the bank accounts of such Odd-lot Holders on or about Monday, 24 April 2023, if
such holders’ banking details have been provided in the relevant Form of Election and
Surrender. Should no banking details be on record for such holders, the funds will be
held by KAL until such time as the details have been provided to Computershare.
6. Those Odd-lot Holders who do not make an election will automatically be regarded as
having chosen and accepted the Cash Consideration.
7. If the General Meeting is adjourned or postponed, Forms of Proxy submitted for the
initial General Meeting will remain valid in respect of any adjournment or postponement
of the General Meeting unless the contrary is stated on such Forms of Proxy.
8. Shareholders may not dematerialise or rematerialise their Shares after the last day to
trade, being Tuesday, 18 April 2023 to the record date, being Friday, 21 April 2023.
Paarl
28 February 2023
Transaction Advisor and Sponsor
PSG Capital
DISCLAIMER
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART,
DIRECTLY OR INDIRECTLY, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO
SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS
OF SUCH JURISDICTION.
This announcement is for information purposes only. It is not intended to and does not
constitute, or form part of, any offer, invitation or the solicitation of any offer to purchase,
otherwise acquire, subscribe for, sell or otherwise dispose of any securities, or the
solicitation of any vote or approval in any jurisdiction, pursuant to the acquisitions of
securities contemplated hereby or otherwise nor shall there be any sale, issuance or transfer
of securities in any jurisdiction in contravention of applicable law.
THIS WRITTEN MATERIAL IS NOT FOR PUBLICATION OR DISTRIBUTION, DIRECTLY
OR INDIRECTLY, IN OR INTO THE UNITED STATES. THE INFORMATION CONTAINED
HEREIN IS NOT AN OFFER OF SECURITIES FOR SALE IN THE UNITED STATES. THE
SECURITIES REFERRED TO HEREIN HAVE NOT BEEN AND WILL NOT BE
REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED, AND MAY
NOT BE OFFERED OR SOLD IN THE UNITED STATES ABSENT REGISTRATION OR AN
EXEMPTION FROM REGISTRATION.
Date: 28-02-2023 04:45:00
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