To view the PDF file, sign up for a MySharenet subscription.

NPN - Naspers - Naspers launches capital raising for expansion

Release Date: 27/02/2007 08:50
Code(s): NPN
Wrap Text

NPN - Naspers - Naspers launches capital raising for expansion NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART IN OR INTO THE UNITED STATES, CANADA, AUSTRALIA OR JAPAN Naspers Limited (Incorporated in the Republic of South Africa) (Registration number 1925/001431/06) share code: NPN & ISIN Code: ZAE000015889 ("Naspers" or the "Company" or the "Group") NASPERS LAUNCHES CAPITAL RAISING FOR EXPANSION Naspers today launched a capital raising by way of a private placement to institutional investors of new Naspers N shares ("New N Shares"), to raise the ZAR-equivalent of approximately US$750 million (the "Capital Raising"). The Capital Raising will be undertaken primarily by way of an issue of shares for cash under the JSE Listings Requirements. The Capital Raising will take place at a price to be established through a bookbuilding process to be conducted by Citigroup Global Markets Limited ("Citigroup" or "Bookrunner") as Bookrunner. Bookbuilding will begin on Wednesday 28 February 2007 and pricing is currently expected to be announced on Thursday 8 March 2007. The timing of the closing of the book, pricing and allocations may be amended at the absolute discretion of the Company and the Bookrunner. In addition, Naspers has granted an over-allotment option (the "Over- allotment Option") to the Bookrunner, pursuant to which it may issue up to an additional 15% (the "Over-allotment Shares") of the number of shares placed in terms of the Capital Raising to cover over-allotments, if any. All shares issued pursuant to the Capital Raising (including the Over- allotment Shares) will be New N Shares. The New N Shares will, when issued, be credited as fully paid and will rank pari passu in all respects with the existing issued "N" ordinary shares of the Company, including the right to receive future dividends and other distributions declared, made or paid after the date of their issue. Application will be made for the New N Shares to be admitted to trading on the JSE Limited. Commenting on the proposed transaction, Koos Bekker, Chief Executive Officer of Naspers, said: "The capital raising will strengthen our ability to participate as a strategic partner in media companies across the emerging markets". International Investment Strategy Naspers is an integrated media company operating mainly within emerging markets. The Group`s investment strategy is to invest in media assets in the most promising of the emerging markets. These markets have shown rapid growth in recent years, which is expected to continue into the foreseeable future. Naspers`s core expertise includes packaging and distribution of key content and services, building solid brands around these and managing the associated subscriber platforms. Given this expertise, Naspers is well placed to develop investment opportunities in new media services and content businesses such as user generated content platforms, communication, and entertainment delivered via mobile and PC platforms. Within the emerging markets, Naspers focuses on investment opportunities in its core platforms of pay-television, internet, mobile and print media. In furtherance of this strategy, Naspers has already invested in substantial media assets across emerging markets. From 2001 and to 2006, the Group made the following acquisitions: * Acquired an interest in Tencent, China`s leading provider of internet and mobile value-added services. Tencent listed on the Hong Kong Stock Exchange in June 2004 and Naspers` interest is today 36%. Tencent is the largest instant messaging platform in China with 221 million active messaging accounts. Alexa ranks Tencent`s QQ.com as the most visited portal in China and is ranked the 9th largest globally. * Acquired 100% of CryptoTec conditional access business from Philips. The business is involved in the development and sale of content security systems. CryptoTec, when combined with Naspers` existing Irdeto business, created a third largest player in the conditional access market, with over 300 customers worldwide. * Acquired a 30% interest in Abril, the leading magazine publisher in Brazil and one of the largest media companies in Latin America. Abril`s flagship newsweekly, Veja, is the fourth highest selling weekly in the world. In addition, Abril also owns the country`s leading educational book publisher. * Acquired a 25% interest in Tixa, a privately held Chinese company, which operates an internet contextual advertising platform targeted at Chinese SMEs under the "Narrowad" brand name. * Acquired an interest in Titan, a leading company in the field of Chinese sports publishing. * Announced the acquisition of the 38% interest in M-Net and SuperSport held by Johnnic Communications. The consolidation of this strategic asset will boost M-Net/SuperSport`s Black Economic Empowerment ("BEE") ownership and facilitate future investment to transfer M- Net/SuperSport to new technology platforms. The transaction remains subject to regulatory approvals. In the current calendar year, the Group made the following acquisitions: * A 30% stake in Russian internet company Mail.ru. Mail.ru is a leading provider of internet and communication services to the global Russian- speaking community, estimated to be approximately 300 million people. Ranked as the number one email service for Russian speaking users, it provides a wide range of communication services. At present, Mail.ru has some 24 million unique monthly visitors and about two million instant messaging users. * A 30% interest in popular instant-messaging service MXit Lifestyle. MXit is an instant-messaging service for mobile phones, with about 3 million users. It allows users to send and receive text messages using a mobile phone. In addition to these investments, Naspers is currently pursuing several others, some of which may be material, although no binding agreements have been entered into at this stage. Use of Proceeds Proceeds from the Capital Raising will be used in the execution of Naspers`s international investment strategy and to replenish internal resources utilised for the purposes of Naspers` acquisition of Russian internet portal Mail.ru, Brazilian magazine publisher Abril and Chinese sports publisher Titan. Recent Financial Performance Update Naspers published its interim results for the six months ended 30 September 2006 on 29 November 2006. The Group has not published any financial information in respect of the three month period to 31 December 2006. However, based on currently available information, the Group continues to grow. Revenue growth was largely driven by an increase of an additional 100,000 pay television subscribers for the period whilst advertising revenues continued to show growth. The internet businesses maintained their market leadership and the technology businesses showed progress. Operating profit before amortisation and other gains/losses continued to grow at similar levels to that reported in September 2006. However, investors need to be aware that the Group remains subject to the trading, political, regulatory and technological risks previously identified, as well as those which the Group may currently not foresee. The above financial information has not been reviewed or audited by the Group`s auditors. Summary Consolidated Financial and Operating Data for Naspers
For the year For the six ended 31 March, months ended 30
September, 2005 2006 2005 2006 Income Statement Data, IFRS Revenue, Net 13,518 15,706 7,429 9,072 Operating Expenses: Cost of Services and (7,726) (8,754) (4,153) (4,649) Goods Selling, General and (3,311) (3,948) (1,865) (2,570) Administration Other (Losses)/Gains Net (12) - 13 116 Operating Profit 2,469 3,004 1,424 1,969 Finance Costs, Net (217) 16 (25) (466) Share of Equity Accounted 88 95 82 93 Results Profit on Sale of - 74 16 - Investments Impairment of equity - - - (150) accounted investment Dilution Profits 368 - - - Profit Before Tax 2,708 3,189 1,497 1,446 Taxation (257) (935) (430) (571) Profit After Taxation 2,451 2,254 1,067 875 Core Headline Earnings * 1,185 2,027 914 1,308 * Core headline earnings adjusts for non-recurring and non-operational items. The Naspers board`s view is that it represents an appropriate measure of the sustainable operating performance of the Group. In November 2006, Naspers announced the completion of two landmark BEE transactions. The Welkom Yizani and Phuthuma Nathi transactions each involved a public offer of shares to qualifying investors, in respect of the Media24 and MultiChoice South Africa businesses, respectively. Following completion of these transactions, BEE ownership in each of these companies amounted to 15%. A further offer of shares in MultiChoice South Africa, representing an additional 7.5% interest, was announced for the first quarter of 2007. Over-allotment Option In connection with the Capital Raising, the Bookrunner has been granted an option exercisable in whole or in part for a 30 day period commencing on the date of pricing of the New N Shares. Pursuant to this option, the Bookrunner may require the Company to issue further New N Shares equivalent to up to a further 15% of the number of shares placed as part of the Capital Raising at the offer price of the Capital Raising in order to cover over-allotments, if any. In connection with this Capital Raising, Citigroup, as stabilising manager, may allot or effect transactions which may support the market price of Naspers N shares at a level higher than that which might otherwise prevail for a limited period after the pricing date. However, there is no obligation on Citigroup to do so. Such stabilising action may under no circumstances continue beyond 30 calendar days after the pricing date. Citigroup is acting as sole global co-ordinator, bookrunner and stabilising manager in the Capital Raising. For further information, please contact the following: Naspers:
Steve Pacak Mark Sorour Beverley Branford Chief Financial Chief Investment Investor Relations Officer Officer Tel: +27-21-406- Tel: +27-21-406- Tel: +27-21-406- 4824 2480 3008 Fax: +27-21-406- Fax: +27-21-406- Fax: +27-21-406- 2890 2921 2890 Citigroup: Darren Uden Tom Attenborough Managing Director Director Tel: +44-20 7986-0410 Tel: +44-20 7986-0440 Fax: +44-20 7986-1103 Fax: +44-20 7986-1139 Disclaimer This announcement has been issued by, and is the sole responsibility of Naspers Limited. The distribution of this announcement and the offer and sale of Naspers Limited N shares in certain jurisdictions may be restricted by law. Any persons reading this announcement should inform themselves of, and observe, any such restrictions. This announcement is not for publication or distribution, directly or indirectly, in or into the United States of America (including its territories and possessions, any state of the United States and the District of Columbia). This announcement does not in any manner constitute an invitation to invest or an advertisement, notification, statement or announcement soliciting investment in the shares of Naspers Limited or an offer of securities for sale in the United States or in any jurisdiction in which such an offer or solicitation is unlawful. The securities referred to in this announcement 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, except pursuant to registration or an applicable exemption from registration. No public offering of securities is being made into the United States. Certain statements in this announcement constitute "forward looking statements" within the meaning of Section 27A of the US Securities Act of 1933 and Section 21E of the US Securities Exchange Act of 1934. Such forward looking statements involve known and unknown risks, uncertainties and other important factors that could cause the actual results, performance or achievements of Naspers Limited to be materially different from the future results, performance or achievements expressed or implied by such forward looking statements. These factors include those discussed in our reports submitted to the SEC. We undertake no obligation to update publicly or release any revisions to these forward looking statements to reflect events or circumstances after the date of this announcement or to reflect the occurrence of unanticipated events. Within the United Kingdom, this announcement is directed only at persons who have professional experience in matters relating to investments who fall within article 19(5) of the United Kingdom Financial Services and Markets Act 2000 (Financial Promotion) Order 2001 (as amended) (the "Order") or are persons falling within article 49(2)(a) to (d) ("high net worth individuals, unincorporated associations etc.") of the Order (all such persons together being referred to as "relevant persons"). This communication must not be acted on or relied on by persons who are not relevant persons. Any investment or investment activity to which this communication relates is available only to relevant persons and will be engaged in only with relevant persons. As regards all persons other than relevant persons, the details of the Capital Raising and bookbuilding set out in this announcement are for information purposes only. No prospectus offering securities to the public will be published. Citigroup is acting for Naspers Limited and no one else in connection with the Capital Raising and will not be responsible to any other person for providing the protections afforded to their respective clients, or for providing advice in relation to the Capital Raising. Stabilisation / FSA Cape Town 27 February 2007 Sponsor: Investec Bank Limited Date: 27/02/2007 08:50:01 Supplied by www.sharenet.co.za Produced by the JSE SENS Department.

Share This Story