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Illovo Sugar Limited - Scheme of Arrangement
Illovo Sugar Limited
(Incorporated in the Republic of South Africa)
(Registration number 1906/000622/06)
(Share code: ILV)
(ISIN: ZAE000003547)
("Illovo")
ABF Overseas Limited
(Incorporated in England)
(Registration number 03313345)
("ABF")
SCHEME OF ARRANGEMENT
1. INTRODUCTION
Illovo shareholders are referred to the announcement released on SENS
on Friday, 19 May 2006 and published in the press on Monday, 22 May
2006 in which they were advised that Associated British Foods plc
("ABF plc") had submitted to the board of directors of Illovo a notice
of its firm intention to make an offer to acquire (directly or through
a wholly owned subsidiary) 51% of the fully diluted ordinary issued
share capital of Illovo ("the offer").The offer will be effected by
way of a scheme of arrangement in terms of section 311 of the
Companies Act 61 of 1973, as amended, to be proposed by ABF (a wholly-
owned subsidiary of ABF plc) between Illovo and all of its
shareholders ("the scheme") for a cash consideration of R21.00 per
Illovo share ("the scheme consideration").
The High Court (Durban and Coast Local division) ("the High Court")
has granted an order for the convening of a meeting of Illovo
shareholders, details of which are set out in paragraph 5 below, to
consider and, if deemed fit, agree to the scheme ("the scheme
meeting").
2. THE SCHEME
Upon the scheme becoming operative, ABF will, in exchange for the
scheme consideration, acquire 51.00614 Illovo shares for every 100
Illovo shares held by Illovo shareholders (subject to rounding)
recorded in the register of Illovo shareholders on the record date for
the scheme ("scheme participants"), which date will be published after
the scheme has been sanctioned by the High Court.
3. CONDITIONS PRECEDENT TO THE SCHEME
The implementation of the scheme is subject, inter alia, to the
fulfilment of the following conditions precedent:
- all necessary regulatory approvals having been obtained,
including that of the South African Competition Authorities;
- the scheme being agreed to at the scheme meeting by a majority of
Illovo shareholders representing not less than 75% of the votes
exercisable by scheme members, present and voting either in
person or by proxy;
- the passing by Illovo shareholders in general meeting of the
ordinary resolution referred to in paragraph 4 below and the
actual waiver by the Securities Regulation Panel ("the SRP") of
the requirement to extend an offer to Illovo shareholders as
referred to in paragraph 4 below; and
- the sanctioning of the scheme by the Court.
4. THE WAIVER, AMENDMENTS TO THE MEMORANDUM AND ARTICLES OF ASSOCIATION
AND NOTICE OF GENERAL MEETING
Subject to an ordinary resolution to such effect being passed by a
simple majority of Illovo shareholders in general meeting, the SRP has
indicated to ABF that it will waive the requirement arising pursuant
to Rule 8 of the Securities Regulation Code on Take-overs and Mergers
and the Rules of the SRP ("the Code") for ABF to extend an offer to
Illovo shareholders to acquire all of their Illovo shares following
the implementation of the scheme.
In addition, should the scheme be implemented and with the approval by
way of special resolutions approved by Illovo shareholders in general
meeting, certain amendments to the Memorandum and Articles of
Association of Illovo ("the Memorandum and Articles") will be made to
ensure the enforceability by Illovo and/or by Illovo shareholders
holding, in aggregate, 5% or more of the issued ordinary share capital
of Illovo, of various minority protections offered by ABF plc relating
to:
* the pursuit of certain territorial expansion opportunities by ABF
plc and its subsidiaries ("the ABF group");
* disposals by the ABF group to Illovo;
* commercial arrangements between the ABF group and Illovo; and
* an ownership and control cap on the ABF group"s shareholding in
Illovo.
A general meeting of Illovo shareholders will be held at 13:00 on
Wednesday, 12 July 2006 at the registered office of Illovo, Illovo Sugar
Park, 1 Montgomery Drive, Mount Edgecombe at which Illovo shareholders will
be asked to consider and, if deemed fit, pass an ordinary resolution
approving the waiver of the requirement for ABF to make a mandatory offer
to acquire all the issued shares of Illovo and special resolutions
approving the amendments to the Memorandum and Articles to enable the
enforceability of these minority protections ("the general meeting").
5 THE SCHEME MEETING
The scheme meeting will be held at 13:30 (or ten minutes after the
conclusion or adjournment of the general meeting, whichever is the
later) on Wednesday, 12 July 2006 at the registered office of Illovo,
Illovo Sugar Park, 1 Montgomery Drive, Mount Edgecombe.
6. IMPORTANT DATES AND TIMES
The important dates and times in relation to the scheme are set out
below.
2006
Last day to trade in Illovo shares in
order to be recorded in the register of
Illovo shareholders to vote at the
scheme meeting Friday, 30 June
Record date to vote at the scheme Friday, 7 July
meeting
Last day for receipt of forms of proxy
for the general meeting by 13:00 on Monday, 10 July
Last day for receipt of forms of proxy
for the scheme meeting by 13:30 on Monday, 10 July
General meeting to be held at 13:00 on Wednesday, 12 July
Scheme meeting to be held at 13:30 or
ten minutes after the conclusion or
adjournment of the general meeting,
whichever is the later, on Wednesday, 12 July
Results of the general meeting and the
scheme meeting released on SENS Wednesday, 12 July
Results of the general meeting and the
scheme meeting published in the press Thursday, 13 July
Announcement of the date and time of
the Court hearing to sanction the at least seven days prior
scheme to be released on SENS and to the Court hearing to
published in the press sanction the scheme
Notes:
1. The abovementioned dates and times are South African times and
are subject to change. Any such change will be released on SENS
and published in the press.
2. Illovo shareholders are advised that, as trading in shares on the
JSE Limited is settled within the STRATE environment five
business days following the trade, shareholders acquiring
dematerialised Illovo shares after Friday, 30 June 2006 will not
be eligible to vote at the scheme meeting.
3. If a form of proxy for the scheme meeting is not received by the
date and time shown above, it may be handed to the chairman of
the scheme meeting by not later than ten minutes before the
scheme meeting is due to commence.
4. If the general meeting or scheme meeting is adjourned or
postponed, forms of proxy must be received by no later than 48
hours prior to the time of the adjourned or postponed general
meeting or scheme meeting, or in the case of the scheme meeting,
not later than ten minutes before the scheme meeting is due to
commence if handed to the chairman of the scheme meeting. For
the purpose of calculating the latest time by which forms of
proxy must be received, Saturdays, Sundays and South African
public holidays will be excluded.
SHOULD THE SCHEME BE SANCTIONED AND BECOME OPERATIVE, ALL OTHER
REMAINING IMPORTANT DATES AND TIMES, INCLUDING THE LAST DAY TO TRADE
IN ILLOVO SHARES IN ORDER TO PARTICIPATE IN THE SCHEME, THE RECORD
DATE FOR THE SCHEME, THE OPERATIVE DATE AND THE DATE OF PAYMENT OF THE
SCHEME CONSIDERATION, WILL BE RELEASED ON SENS AND PUBLISHED IN THE
PRESS ONCE THEY BECOME KNOWN.
7. DOCUMENTATION
A circular providing further information on the scheme and containing,
inter alia, a notice of the general meeting, a notice of the scheme
meeting, forms of proxy and a form of surrender ("the circular") will
be posted to Illovo shareholders on or about Thursday, 15 June 2006.
8. THE ILLOVO SUGAR 1992 SHARE OPTION SCHEME
In terms of the Code, ABF is required to extend a comparable offer to
the holders of options ("options") issued under The Illovo Sugar 1992
Share Option Scheme ("option holders"). Accordingly, an offer ("the
option offer") has been made to option holders in respect of the
options that have
- vested, to acquire 100% of such option holders" Illovo shares
resulting from the exercise of 51% of such options immediately
after the operative date of the scheme, at a consideration equal
to the scheme consideration; and
- not yet vested, to allow for the accelerated vesting of 51% of
such options and the acquisition of 100% of the Illovo shares
issued pursuant to the exercise of such vested options
immediately after the operative date of the scheme, at a
consideration equal to the scheme consideration.
There are 12 215 200 options outstanding, in respect of which
irrevocable undertakings to accept the option offer have been received
in respect of 12 117 700 of such options. The directors of Illovo have
undertaken to accept the option offer described above in respect of
options held by them, details of which are contained in the circular.
9. THE SUBSTITUTE OFFER
In the event that the scheme does not become operative for any reason
other than the failure to obtain all necessary regulatory approvals
required for the implementation of the scheme, ABF may elect to make a
substitute offer to purchase 51% of the fully diluted ordinary share
capital of Illovo at a price not less than the scheme consideration.
Mount Edgecombe
15 June 2006
Investment bank to Illovo
Standard Bank
Investment bank to ABF
Rothschild
Sponsor to Illovo
J P Morgan Equities
Attorneys to Illovo
Cliffe Dekker
Garlicke & Bousfield
Attorneys to ABF
Bowman Gilfillan
Date: 15/06/2006 05:45:56 PM Supplied by www.sharenet.co.za
Produced by the JSE SENS Department
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