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(INCORPORATED ON 31 MARCH 1993 IN ENGLAND AND WALES UNDER THE COMPANIES ACT
1985 - NO. 2805337 AND RE-REGISTERED AS A PUBLIC COMPANY ON 26 FEBRUARY 1998)
("LONRHO AFRICA" OR "THE COMPANY")
ABRDIGED LISTING PARTICULARS
THE ABRIDGED LISTING PARTICULARS SET OUT BELOW DO NOT CONSTITUTE AN OFFER OR
INVITATION TO THE PUBLIC OR TO ANY PERSON TO SUBSCRIBE FOR OR PURCHASE SHARES
OR ANY OTHER SECURITIES IN THE COMPANY. NO SUCH SHARES OR SECURITIES HAVE BEEN
MARKETED OR ARE BEING MADE AVAILABLE IN WHOLE OR IN PART TO THE PUBLIC IN
CONJUNCTION WITH THE COMPANY`S APPLICATIONS FOR LISTING IN LONDON AND
JOHANNESBURG. THE INFORMATION IS PROVIDED IN TERMS OF THE LISTINGS REQUIREMENTS
OF THE JOHANNESBURG STOCK EXCHANGE ("JSE") WITH REGARDS TO ABRIDGED LISTING
PARTICULARS AND HAS BEEN EXTRACTED FROM THE DETAILED LISTING PARTICULARS OF
LONRHO AFRICA, DATED 4 MARCH 1998, AS UPDATED BY SUPPLEMENTARY LISTING
PARTICULARS OF LONRHO AFRICA, DATED 17 MARCH AND 29 APRIL 1998, AND SHOULD BE
READ IN CONJUNCTION WITH THE FULL TEXT OF SUCH DOCUMENTS, COPIES OF WHICH ARE
AVAILABLE FOR INSPECTION AS SET OUT BELOW.
1. INTRODUCTION
FOLLOWING THE UK HIGH COURT`S APPROVAL OF THE DEMERGER BY LONRHO PLC ("LONRHO")
OF ITS AFRICAN NON-MINING BUSINESSES ("THE DEMERGER"), AND SUBJECT TO THE
REGISTRATION BY THE UK REGISTRAR OF COMPANIES, THE LISTING OF ALL OF THE
ORDINARY SHARES OF 20 PENCE EACH IN LONRHO AFRICA ISSUED AND TO BE ISSUED
PURSUANT TO THE DEMERGER (EXPECTED TO COMPRISE 157 572 088 ORDINARY SHARES OF
20 PENCE EACH) COMMENCES ON THE JSE AND THE LONDON STOCK EXCHANGE
SIMULTANEOUSLY ON 7 MAY 1998.
2. NATURE OF BUSINESS
LONRHO AFRICA AND ITS SUBSIDIARIES AND ASSOCIATED COMPANIES ("THE GROUP")
CURRENTLY OPERATES IN 14 SUB-SAHARAN AFRICAN COUNTRIES (INCLUDING MAURITIUS)
AND HAS FIVE CORE ACTIVITES:
MOTORS:
THE MOTORS DIVISION HOLDS A WIDE RANGE OF DISTRIBUTORSHIPS AND DEALERSHIPS IN
TEN AFRICAN COUNTRIES, IMPORTING, DISTRIBUTING, SELLING AND SERVICING MOTOR
VEHICLES, MOTOR CYCLES, GENERATOR SETS AND SMALL AIRCRAFT. THE DIRECTORS
BELIEVE THAT THE GROUP IS A NEW VEHICLE MARKET LEADER IN THE MAJORITY OF THE
COUNTRIES IN WHICH IT OPERATES. THEY ALSO BELIEVE THAT TOYOTA, THE GROUP`S
FLAGSHIP FRANCHISE, IS THE LARGEST SELLING MOTOR VEHICLE BRAND IN SUB-SAHARAN
AFRICA.
AGRI-BUSINESS:
OPERATING IN SEVEN AFRICAN COUNTRIES, THE AGRI-BUSINESS DIVISION CARRIES OUT
PRINCIPALLY THE DOWNSTREAM PROCESSING OF PRIMARY AGRICULTURAL PRODUCTS, WITH
INCREASING FOCUS ON PRODUCTS FOR EXPORT. THE PRINCIPAL ACTIVITIES OF THE
DIVISION ARE COTTON GINNING IN AFRICA, COTTON MERCHANTING IN THE UK, TIMBER
PROCESSING, FOOD PROCESSING AND THE BREWING OF OPAQUE BEER.
DISTRIBUTION:
THE PRINCIPAL ACTIVITY OF THE DISTRIBUTION DIVISION IS THE PURCHASE OF GOODS
FROM INTERNATIONAL AND LOCAL SUPPLIERS FOR SALE THROUGH THE GROUP`S EXTENSIVE
DISTRIBUTION NETWORK IN NIGERIA. THE DIVISION ALSO ARRANGES TRADE FINANCE FOR
THE GROUP FROM ITS UK OFFICE.
HOTELS:
THE GROUP OPERATES ELEVEN HOTELS AND LODGES AT THE HIGHER END OF THEIR
RESPECTIVE MARKETS IN KENYA, GHANA, MOZAMBIQUE, MAURITIUS AND ZIMBABWE. THE
HOTELS IN MAURITIUS AND ZIMBABWE ARE OPERATED UNDER MANAGEMENT CONTRACTS. THE
GROUP ALSO OWNS A HOTEL IN ZAMBIA WHICH IT INTENDS TO SELL.
PROPERTY AND CONSTRUCTION:
THE PROPERTY AND CONSTRUCTION DIVISION IS RESPONSIBLE FOR THE DEVELOPMENT AND
MANAGEMENT OF THE GROUP`S PROPERTY INTERESTS THROUGHOUT AFRICA. IN ADDITION,
THE DIVISION CONSTRUCTS, DEVELOPS AND MANAGES THIRD PARTY PROPERTY.
THE DIRECTORS OF LONRHO AFRICA BELIEVE THAT THE KEY STRENGTHS OF THE GROUP ARE:
MANAGEMENT EXPERIENCE IN AFRICA:
THE MAJORITY OF THE GROUP`S SENIOR AND MIDDLE MANAGEMENT HAVE WORKED IN AFRICA
FOR MANY YEARS AND THE RECENT REORGANISATION PROVIDED THE GROUP WITH AN
OPPORTUNITY TO STRENGTHEN FURTHER BOTH ITS SENIOR AND MIDDLE MANAGEMENT TEAMS.
THE DIRECTORS BELIEVE THAT THIS MANAGEMENT EXPERTISE IS KEY TO OPERATING
SUCCESSFULLY IN AFRICA AND ENHANCES THE ABILITY OF THE GROUP TO EXPAND ITS
RANGE OF BUSINESSES WITHIN THE AFRICAN COUNTRIES IN WHICH IT OPERATES WHEN
APPROPRIATE OPPORTUNITIES ARISE.
STRONG LOCAL RELATIONSHIPS:
THE GROUP, SUPPORTED BY ITS NETWORK OF COUNTRY CHAIRMEN, HAS MAINTAINED
LONRHO`S STRONG, LONG-STANDING RELATIONSHIPS WITH GOVERNMENTS, LOCAL
COMMUNITIES AND BUSINESSES.
GEOGRAPHICAL DIVERSIFICATION:
THE WIDE RANGE OF COUNTRIES IN WHICH THE GROUP OPERATES REDUCES ITS EXPOSURE TO
ANY SINGLE POLITICAL, ECONOMIC OR CLIMATIC EVENT IN THE REGION.
PARTICIPATION IN ECONOMIC DEVELOPMENT:
THE CORE BUSINESS ACTIVITIES SELECTED BY THE GROUP ARE IN A NUMBER OF MARKET
SECTORS WHICH THE DIRECTORS BELIEVE ARE IMPORTANT TO, AND WILL BENEFIT FROM,
ECONOMIC GROWTH IN THE COUNTRIES IN WHICH THEY OPERATE.
MARKET LEADERSHIP:
BASED ON THE DIRECTORS` ESTIMATES OF THE MARKETS IN WHICH THE GROUP OPERATES,
THE MAJORITY OF LONRHO AFRICA`S BUSINESSES ARE LEADERS IN THEIR MARKETS.
STRONG BRANDS:
THE GROUP`S BUSINESSES OWN A NUMBER OF STRONG BRANDS INCLUDING FARMER`S CHOICE,
JOHN HOLT AND THE LONRHO AFRICA NAME ITSELF.
ASSET BACKING AND CAPITAL STRUCTURE:
THE GROUP OWNS OR LEASES LAND AND BUILDINGS WHICH, AS AT 30 SEPTEMBER 1997, HAD
A NET BOOK VALUE OF GBP140 MILLION AND HAD PRO FORMA NET ASSETS (INCLUDING
MINORITY INTERESTS) OF GBP270 MILLION AS AT THAT DATE. THIS PROVIDES THE GROUP
WITH SUBSTANTIAL ASSET BACKING. IN ADDITION, AS PART OF THE TERMS OF THE
DEMERGER, THE GROUP HAS RECEIVED A CAPITAL INJECTION FROM LONRHO RESULTING IN
PRO FORMA GEARING AT 30 SEPTEMBER 1997 OF 22 PER CENT.
3. PROSPECTS
THE GROUP`S PERFORMANCE IS SIGNIFICANTLY AFFECTED BY THE ECONOMIC, CLIMATIC AND
POLITICAL CONDITIONS IN THE COUNTRIES IN WHICH IT OPERATES. DESPITE THE
HISTORICAL VOLATILITY OF SUCH CONDITIONS IN THESE COUNTRIES, THE DIRECTORS
BELIEVE THAT THE CORE BUSINESS ACTIVITIES OF THE GROUP ARE IN A NUMBER OF
MARKET SECTORS WHICH ARE IMPORTANT TO, AND WILL BENEFIT FROM, ECONOMIC GROWTH
IN THOSE COUNTRIES IN WHICH THEY OPERATE.
4. DIRECTORS
BERNARD HARRY ASHER - NON-EXECUTIVE CHAIRMAN
ANTONY CHRISTOPHER LEOD PARVIN - EXECUTIVE DEPUTY CHAIRMAN
MARK VIVIAN ADRIAN NEWMAN - CHIEF EXECUTIVE
KEITH MELVYN ATKINSON - FINANCE DIRECTOR
STEPHEN RODERICK WALLS - NON-EXECUTIVE DIRECTOR
MICHAEL STUART WILSON - NON-EXECUTIVE DIRECTOR
ALL OF YORK HOUSE, MERCURY COURT, TITHEBARN STREET, LIVERPOOL L2 2RG.
5. DETAILED LISTING PARTICULARS
COPIES OF THE DETAILED LISTING PARTICULARS AND SUPPLEMENTARY LISTING
PARTICULARS OF LONRHO AFRICA, AS MENTIONED ABOVE, WILL BE AVAILABLE, IN
ENGLISH, FROM TODAY, 7 MAY 1998 TO 28 MAY 1998 DURING NORMAL BUSINESS HOURS AT
THE SOUTH AFRICAN OFFICES OF LONRHO, SIXTH FLOOR, 19 GIRTON ROAD, PARKTOWN
2193, JOHANNESBURG.
DATED: 6 MAY 1998
SPONSORING BROKER
HSBC SIMPSON MCKIE