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NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN THE UNITED STATES OF AMERICA,
CANADA OR JAPAN
SANLAM LIMITED
PRICING AND RESULTS OF OFFERS
PUBLIC OFFER PRICE 600 CENTS PER SHARE
POLICYHOLDERS' OFFER PRICE 540 CENTS PER SHARE
OFFER PROCEEDS R4 BILLION
INTRODUCTION
SANLAM LIMITED ("SANLAM") IS PLEASED TO ANNOUNCE THE PRICING AND RESULTS OF THE
OFFERS OF ORDINARY SHARES IN THE SHARE CAPITAL OF SANLAM (THE "SHARES").
AN ENGLISH COPY OF THE PROSPECTUS RELATING TO THE OFFERS (THE "PROSPECTUS") WAS
REGISTERED BY THE SOUTH AFRICAN REGISTRAR OF COMPANIES ON 28 OCTOBER 1998 IN
TERMS OF SECTION 155(1) OF THE SOUTH AFRICAN COMPANIES ACT (NO. 61 OF 1973) AND
BY THE NAMIBIAN REGISTRAR OF COMPANIES ON 28 OCTOBER 1998 IN TERMS OF SECTION
155(1) OF THE NAMIBIAN COMPANIES ACT (NO. 61 OF 1973).
THIS ANNOUNCEMENT DOES NOT CONSTITUTE A PROSPECTUS AND IS ISSUED MERELY FOR
RECORD PURPOSES IN CONNECTION WITH THE OFFERS. HOWEVER, IT SHOULD BE READ IN
CONJUNCTION WITH THE PROSPECTUS AS IT IS INTENDED, WHERE APPROPRIATE, TO UPDATE
AND SUPPLEMENT THE PROSPECTUS.
WORDS AND EXPRESSIONS DEFINED IN THE PROSPECTUS HAVE THE SAME MEANING WHEN USED
IN THIS ANNOUNCEMENT, UNLESS THE CONTEXT REQUIRES OTHERWISE.
IN CONNECTION WITH THE OFFERS, THE GLOBAL CO-ORDINATORS MAY OVER-ALLOT AND
ROBERT FLEMING & CO. LIMITED ("FLEMINGS") THE STABILISING MANAGER, ON BEHALF OF
THE GLOBAL CO-ORDINATORS, MAY EFFECT TRANSACTIONS TO STABILISE OR MAINTAIN THE
MARKET PRICE OF THE SHARES AT A LEVEL WHICH MIGHT NOT OTHERWISE PREVAIL IN THE
OPEN MARKET. AS THE JOHANNESBURG STOCK EXCHANGE ("JSE") AND NAMBIAN STOCK
EXCHANGE ("NSX") DO NOT PERMIT PRICE STABILISATION TRANSACTIONS, FLEMINGS WILL
EFFECT ANY TRANSACTIONS USING A QUOTE ON SEAQ INTERNATIONAL, IN ACCORDANCE WITH
THE RELEVANT REGULATIONS (STABILISATION/FSA). SUCH STABILISATION, IF
COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
IN ADDITION, SANLAM MAY ISSUE UP TO 150 MILLION SHARES TO GENBEL SECURITIES
LIMITED ("GENSEC"), ON BEHALF OF ITS MANAGED FUNDS, PURSUANT TO THE GENSEC
SUBSCRIPTION AGREEMENT, IN TERMS OF WHICH GENSEC, ON BEHALF OF ITS MANAGED
FUNDS, WILL BE OBLIGED TO SUBSCRIBE FOR SUCH SHARES AT THE PUBLIC OFFER PRICE
TO THE EXTENT THAT IT HAS NOT ACQUIRED SUCH NUMBER OF SHARES IN THE OPEN MARKET
AT BELOW THE PUBLIC OFFER PRICE BEFORE 28 DECEMBER 1998.
FLEMINGS, KLEINWORT BENSON LIMITED ("DRESDNER KLEINWORT BENSON") AND CAZENOVE &
CO., WHICH ARE REGULATED BY THE SECURITIES AND FUTURES AUTHORITY LIMITED OF THE
UNITED KINGDOM, ARE ACTING FOR SANLAM AND NO ONE ELSE IN RELATION TO THE OFFERS
AND WILL NOT BE RESPONSIBLE TO ANYONE OTHER THAN SANLAM FOR PROVIDING THE
PROTECTIONS AFFORDED TO THEIR CUSTOMERS NOR FOR PROVIDING ADVICE IN RELATION TO
THE OFFERS.
OFFERS
THE OFFERS RAISED APPROXIMATELY R4 BILLION OF CAPITAL BEFORE THE DEDUCTION OF
EXPENSES OF THE DEMUTUALISATION PROPOSAL (ESTIMATED AT R550 MILLION) AND
COMPRISED 689 MILLION SHARES IN AGGREGATE, ASSUMING NO EXERCISE OF THE
OVER-ALLOTMENT OPTIONS AND NO ISSUE OF SHARES PURSUANT TO THE GENSEC
SUBSCRIPTION AGREEMENT. OF SUCH NUMBER, 181 MILLION SHARES ARE BEING ISSUED IN
THE POLICYHOLDERS' OFFER AT THE POLICYHOLDERS' OFFER PRICE AND THE REMAINDER
ARE BEING ISSUED IN THE PUBLIC OFFER AT THE PUBLIC OFFER PRICE. OF THE SHARES
BEING ISSUED IN THE PUBLIC OFFER, 499 MILLION SHARES ARE BEING ISSUED IN THE
INSTITUTIONAL OFFER, 5 MILLION SHARES ARE BEING ISSUED IN THE PREFERENTIAL
RETAIL OFFER AND 4 MILLION SHARES ARE BEING ISSUED IN THE RETAIL OFFER.
SHARE CAPITAL FOLLOWING THE OFFERS
AUTHORISED
NOMINAL VALUE NUMBER
R40 MILLION 4 000 MILLION ORDINARY SHARES OF 1 CENT EACH
ISSUED AND FULLY PAID (1)
NOMINAL VALUE NUMBER
R26 126 046 2 612 604 617 ORDINARY SHARES OF 1 CENT EACH
PREMIUM R3 130 613 428
(1) ASSUMING NO EXERCISE OF THE OVER-ALLOTMENT OPTIONS; NO ISSUE OF SHARES
PURSUANT TO THE GENSEC SUBSCRIPTION AGREEMENT; AND THE SET OFF OF EXPENSES OF
THE DEMUTUALISATION PROPOSAL ESTIMATED AT R550 MILLION AGAINST SHARE PREMIUM.
4. PRICING AND OFFER STATISTICS (1)
THE FOLLOWING OFFER STATISTICS REFLECT THE RESULTS OF THE OFFERS BASED ON A
TOTAL OFFER SIZE OF R4 026 MILLION, THE PUBLIC OFFER PRICE OF 600 CENTS PER
SHARE, THE POLICYHOLDERS' OFFER PRICE OF 540 CENTS PER SHARE AND THE ISSUE OF
689 MILLION SHARES IN THE OFFERS.
PUBLIC OFFER PRICE PER SHARE 600 CENTS
POLICYHOLDERS' OFFER PRICE PER SHARE 540 CENTS
NUMBER OF SHARES IN THE OFFERS
- TO RAISE NEW CAPITAL FOR THE SANLAM GROUP 632 MILLION
- FREE SHARES (2) 57 MILLION
VALUE OF SHARES IN THE OFFERS
- PUBLIC OFFER R3 050 MILLION
- POLICYHOLDERS' OFFER R976 MILLION
SHARES IN ISSUE FOLLOWING THE OFFERS (3) 2 612 MILLION
MARKET CAPITALISATION AT THE PUBLIC OFFER PRICE R15 672 MILLION
HEADLINE EARNINGS PER SHARE FOR THE YEAR ENDED
31 DECEMBER 1997 (4) 57,9 CENTS
1997 PRICE : EARNINGS MULTIPLE AT THE PUBLIC
OFFER PRICE 10,4 TIMES
NOTIONAL DIVIDEND PER SHARE FOR THE YEAR ENDED
31 DECEMBER 1997 (5) 19,3 CENTS
NOTIONAL 1997 DIVIDEND YIELD AT THE PUBLIC OFFER
PRICE 3,2 PERCENT
ESTIMATED NET PROCEEDS RECEIVABLE BY THE SANLAM
GROUP (6) R3 137 MILLION
NOTES TO PRICING AND OFFER STATISTICS:
(1) ASSUMING (I) NO EXERCISE OF THE OVER-ALLOTMENT OPTIONS; AND (II) NO ISSUE
OF SHARES PURSUANT TO THE GENSEC SUBSCRIPTION AGREEMENT.
(2) CERTAIN FREE SHARES ALLOTTED TO ELIGIBLE POLICYHOLDERS AND ELIGIBLE
EMPLOYEES UNDER SANLAM'S DEMUTUALISATION PROPOSAL WERE ISSUED IN THE OFFERS TO
FUND CERTAIN PAYMENTS DESCRIBED UNDER "USE OF PROCEEDS" BELOW.
(3) THE NUMBER OF SHARES IN ISSUE FOLLOWING THE OFFERS COMPRISES 1 980
MILLION FREE SHARES ALLOTTED UNDER THE DEMUTUALISATION PROPOSAL (INCLUDING 57
MILLION FREE SHARES ISSUED IN THE OFFERS) AND 632 MILLION SHARES ISSUED IN THE
OFFERS TO RAISE NEW CAPITAL FOR THE SANLAM GROUP. IN ADDITION, SANLAM HAS
GRANTED THE GLOBAL CO-ORDINATORS THE OVER-ALLOTMENT OPTIONS AND SANLAM MAY
ISSUE UP TO 150 MILLION SHARES PURSUANT TO THE GENSEC SUBSCRIPTION AGREEMENT.
IF THE OVER-ALLOTMENT OPTIONS WERE TO BE EXERCISED IN FULL AND SANLAM WERE TO
ISSUE THE FULL 150 MILLION SHARES PURSUANT TO THE GENSEC SUBSCRIPTION
AGREEMENT, THIS WOULD RESULT IN THE ISSUE OF AN ADDITIONAL 253 MILLION SHARES.
THE MARKET CAPITALISATION AT THE PUBLIC OFFER PRICE, ASSUMING THE ISSUE OF
THESE ADDITIONAL SHARES, WOULD BE APPROXIMATELY R17 190 MILLION.
(4) HEADLINE EARNINGS PER SHARE IS BASED ON HEADLINE EARNINGS FOR THE YEAR
ENDED 31 DECEMBER 1997, ASSUMING THAT 1 980 MILLION FREE SHARES WERE IN ISSUE
(INCLUDING 57 MILLION FREE SHARES ISSUED IN THE OFFERS). IT DOES NOT TAKE
ACCOUNT OF THE CAPITAL RAISED OR SHARES ISSUED IN THE OFFERS.
(5) THE NOTIONAL DIVIDEND PER SHARE IS BASED ON A COVER OF THREE TIMES
HEADLINE EARNINGS PER SHARE.
(6) THE ESTIMATED NET PROCEEDS RECEIVABLE BY THE SANLAM GROUP EXCLUDE THE
PROCEEDS OF THE OFFER OF 57 MILLION FREE SHARES AND ARE STATED AFTER DEDUCTION
OF EXPENSES OF THE DEMUTUALISATION PROPOSAL ESTIMATED AT R550 MILLION.
5. USE OF PROCEEDS
THE OFFERS HAVE RAISED A TOTAL OF R4 026 MILLION (BEFORE DEDUCTION OF THE
EXPENSES OF THE DEMUTUALISATION PROPOSAL OF R550 MILLION). OF THIS AMOUNT, R3
687 MILLION REPRESENTS NEW CAPITAL FOR SANLAM LIMITED (ASSUMING NO EXERCISE OF
THE OVER-ALLOTMENT OPTIONS AND NO ISSUE OF SHARES PURSUANT TO THE GENSEC
SUBSCRIPTION AGREEMENT) AND R339 MILLION REPRESENTS PROCEEDS FROM THE OFFER OF
CERTAIN FREE SHARES DESCRIBED BELOW.
THE NEW CAPITAL WILL BE USED BY SANLAM LIMITED TO FUND THE PURCHASE PRICE OF R2
296 MILLION IN CONNECTION WITH THE RESTRUCTURING, AS DESCRIBED IN PART 10 OF
THE PROSPECTUS, OF WHICH R1 456 MILLION WILL BE PAYABLE FOR THE GENSEC SHARES
PURCHASED, R280 MILLION WILL BE PAYABLE FOR THE SANTAM SHARES PURCHASED AND THE
BALANCE IN RESPECT OF THE UNLISTED OPERATING SUBSIDIARIES PURCHASED. SANLAM
LIFE INSURANCE LIMITED WILL USE THE AMOUNT IT RECEIVES FROM SANLAM LIMITED IN
SETTLEMENT OF THE PURCHASE PRICE OF THE TRANSFERRED COMPANIES TO DIVERSIFY ITS
INVESTMENTS, THEREBY INCREASING POLICYHOLDER SECURITY. THE EXCESS CAPITAL
RAISED UNDER THE OFFERS OF R841 MILLION WILL BE USED BY SANLAM LIMITED FOR
GENERAL CORPORATE PURPOSES.
THE PROCEEDS FROM THE OFFER OF APPROXIMATELY 57 MILLION FREE SHARES UNDER THE
INSTITUTIONAL OFFER ARE R339 MILLION. THESE WILL BE USED TO FUND (I) CASH
PAYMENTS TO ELIGIBLE POLICYHOLDERS ALLOCATED FREE SHARES UNDER THE
DEMUTUALISATION PROPOSAL WHO, BECAUSE THEY HAVE ADDRESSES OUTSIDE SOUTH AFRICA
AND NAMIBIA, ARE TO RECEIVE CASH PAYMENTS IN LIEU OF FREE SHARES; (II) PAYMENT
OF THE DEMUTUALISATION LEVY AND, IF INTRODUCED, ANY SIMILAR LEVY IN NAMIBIA;
AND (III) THE TAX PAYABLE WITH RESPECT TO FREE SHARES ALLOCATED TO ELIGIBLE
EMPLOYEES UNDER THE DEMUTUALISATION PROPOSAL. IF A DEMUTUALISATION LEVY IS NOT
INTRODUCED IN NAMIBIA, THE PROCEEDS FROM THE OFFER OF FREE SHARES SET ASIDE FOR
THIS PURPOSE WILL BE USED TO BENEFIT THE NAMIBIAN POLICYHOLDERS OF SANLAM LIFE
INSURANCE LIMITED.
6. DIRECTORS' INTERESTS
THE DIRECT AND INDIRECT BENEFICIAL AND NON-BENEFICIAL HOLDINGS OF SHARES BY
DIRECTORS AT THE DATE OF LISTING ARE SET OUT IN THE TABLE BELOW. THESE
INTERESTS INCLUDE SHARES ALLOCATED PURSUANT TO APPLICATIONS BY DIRECTORS UNDER
THE OFFERS BUT DO NOT INCLUDE SHARES STILL TO BE ALLOCATED TO EXECUTIVE
DIRECTORS UNDER SANLAM'S EMPLOYEE SHARE INCENTIVE SCHEME.
BENEFICIALLY HELD NON BENEFICIALLY HELD
NAME DIRECT INDIRECT INDIRECT TOTAL
MH DALING * 37 755 206 518 - 244 273
JPL ALBERTS 21 854 - - 21 854
AC BAWA 744 - - 744
HSC BESTER** 22 412 72 700 - 95 112
AD BOTHA** 102 284 1 300 18 658 122 242
DC BRINK 23 012 10 600 - 33 612
AS DU PLESSIS** 23 553 113 900 - 137 453
WM GRINDROD 19 226 - - 19 226
K JOWELL 18 818 - - 18 818
DL KEYS 24 982 163 500 - 188 482
DNM MOKHOBO 45 780 - - 45 780
P DE V RADEMEYER** 76 036 1 800 - 77 836
GE RUDMAN** 5 763 86 500 - 92 263
P SMIT 12 494 - 7 407 19 901
PEI SWARTZ 20 405 - - 20 405
JJM VAN ZYL 9 559 - - 9 559
T VOSLOO 15 160 - - 15 160
* EXECUTIVE DIRECTOR
** ALTERNATE AND EXECUTIVE DIRECTOR
THE AGGREGATE PERCENTAGE HOLDING OF THE DIRECTORS IN THE ISSUED SHARE CAPITAL
OF SANLAM AS INDICATED ABOVE IS LESS THAN 0,05 PERCENT.
7. MATERIAL CONTRACTS
THE SALE AND PURCHASE AGREEMENT AMONG SANLAM, THE GLOBAL CO-ORDINATORS AND THE
OTHER MANAGERS REFERRED TO THEREIN, AS DESCRIBED IN PART 17 OF THE PROSPECTUS,
WAS ENTERED INTO ON 30 NOVEMBER 1998.
8. OTHER INFORMATION
GENSEC, A SANLAM SUBSIDIARY, HAS PREVIOUSLY ANNOUNCED THAT IT HAS SUSPENDED ONE
OF ITS TRADERS FOR SUSPECTED SHARE DEALING IRREGULARITIES AND THAT IT AND ITS
EXTERNAL AUDITORS ARE INVESTIGATING THE MATTER AND CERTAIN ALLEGATIONS MADE BY
THE TRADER. WHILE RECOGNISING THE POSSIBLE REPUTATIONAL HARM TO GENSEC AND
SANLAM, THE BOARD OF SANLAM IS OF THE VIEW THAT ON THE BASIS OF THE INFORMATION
CURRENTLY AVAILABLE TO IT, THE ALLEGED ACTIVITIES OF THE TRADER WILL NOT HAVE
AN ADVERSE IMPACT ON THE EARNINGS OF THE SANLAM GROUP.
WITHIN THE ORDINARY COURSE OF THE ASSET MANAGEMENT BUSINESS OF THE SANLAM
GROUP, A SALE CONTRACT WITH DEFERRED SETTLEMENT WAS ENTERED INTO WITH AN
INDIVIDUAL COUNTERPARTY RELATING TO A SIZEABLE BLOCK OF SHARES. THERE IS NOW A
POSSIBILITY THAT THIS INDIVIDUAL COUNTERPARTY WILL NOT BE ABLE TO SETTLE THE
TRANSACTION. AS THE SHARES ARE HELD AS SECURITY, THE BOARD OF SANLAM BELIEVES
THAT EVEN IF THIS TRANSACTION IS NOT SETTLED, IT WILL NOT HAVE AN ADVERSE
IMPACT ON THE EARNINGS OF THE SANLAM GROUP.
FOLLOWING PUBLICATION OF THE PROSPECTUS, IN THE COURSE OF THE INVESTIGATION OF
THE HEATH COMMISSION, THE COMMISSION HAS REQUESTED CERTAIN INFORMATION FROM
SANLAM WHICH HAS BEEN FURNISHED TO IT.
9. COMMENCEMENT OF LISTING
THE JSE HAS AGREED TO GRANT A LISTING OF THE ISSUED SHARE CAPITAL OF SANLAM IN
THE FINANCIAL - "INSURANCE" SECTOR OF THE JSE LIST, AND THE NSX HAS AGREED TO
GRANT A LISTING OF SUCH SHARES IN THE "FINANCIAL" SECTOR OF THE NSX LIST, WITH
EFFECT FROM 30 NOVEMBER 1998. BOTH LISTINGS WILL BE UNDER THE ABBREVIATED NAME
"SANLAM".
10. BASIS OF ANNOUNCEMENT
THE CONTENTS OF THIS ANNOUNCEMENT ARE BASED ON THE ASSUMPTION THAT THE LISTING
OF THE ISSUED SHARE CAPITAL OF SANLAM ON THE JSE AND NSX HAS TAKEN EFFECT.
THIS IS EXPECTED TO OCCUR WITH EFFECT FROM 9.30 AM ON 30 NOVEMBER 1998. A
FURTHER PUBLIC ANNOUNCEMENT WILL BE MADE TO CONFIRM THAT LISTING HAS OCCURRED.
THIS ANNOUNCEMENT DOES NOT FORM PART OF ANY OFFER TO BUY OR TO SUBSCRIBE FOR
ANY SECURITIES AND IS ISSUED MERELY FOR RECORD PURPOSES.
NEITHER THIS ANNOUNCEMENT NOR ANY COPY OF IT MAY BE TAKEN, TRANSMITTED OR
DISTRIBUTED, DIRECTLY OR INDIRECTLY, INTO THE UNITED STATES.
THIS ANNOUNCEMENT IS NOT AN OFFER OF SECURITIES FOR SALE IN THE UNITED STATES.
THE SHARES MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES UNLESS THEY ARE
REGISTERED OR EXEMPT FROM REGISTRATION. THERE HAS NOT BEEN, AND WILL NOT BE, A
PUBLIC OFFERING OF SHARES IN THE UNITED STATES.
GLOBAL CO-ORDINATORS
ROBERT FLEMING & CO. LIMITED
DRESDNER KLEINWORT BENSON
CAZENOVE & CO.
FINANCIAL ADVISERS
DRESDNER KLEINWORT BENSON
ROBERT FLEMING & CO. LIMITED
DOMESTIC OFFERING
SPONSORING BROKER
FLEMING MARTIN SECURITIES LIMITED
RETAIL
ABN AMRO SECURITIES (SOUTH AFRICA) (PTY) LIMITED
BARNARD JACOBS MELLET & CO (PTY) LIMITED
REAL AFRICA DUROLINK SECURITIES LIMITED
SG FRANKEL POLLAK SECURITIES (PTY) LIMITED
INSTITUTIONAL
DEUTSCHE MORGAN GRENFELL (PTY) LIMITED
WARBURG DILLON READ
ABN AMRO SECURITIES (SOUTH AFRICA) (PTY) LIMITED
CAZENOVE SOUTH AFRICA (PTY) LIMITED
BARNARD JACOBS MELLET & CO (PTY) LIMITED
REAL AFRICA DUROLINK SECURITIES LIMITED
SG FRANKEL POLLAK SECURITIES (PTY) LIMITED
INTERNATIONAL OFFERING
DRESDNER KLEINWORT BENSON
ROBERT FLEMING & CO. LIMITED
CAZENOVE & CO.
DEUTSCHE BANK
WARBURG DILLON READ
ABN AMRO ROTHSCHILD
BARNARD JACOBS MELLET & CO (PTY) LIMITED
REAL AFRICA DUROLINK SECURITIES LIMITED
NOMURA INTERNATIONAL
SG INVESTMENT BANKING
LEGAL ADVISERS TO THE ISSUE
CANCA INC.
EDWARD NATHAN & FRIEDLAND INC
JAN S. DE VILLIERS & SON
LEGAL ADVISERS TO THE GLOBAL CO-ORDINATORS
ENGLISH AND UNITED STATES LAW
LINKLATERS & ALLIANCE
SOUTH AFRICAN LAW
WEBBER WENTZEL BOWENS
REPORTING ACCOUNTANTS AND AUDITORS
PRICEWATERHOUSECOOPERS INC.
ERNST & YOUNG
LOGISTICS ADVISERS
SOLID SOLUTIONS ASSOCIATES
COMMUNICATIONS ADVISERS
BRUNSWICK PUBLIC RELATIONS LIMITED
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