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SBK - Standard Bank - Firm Intention To Make An Offer

Release Date: 27/05/2008 17:42
Code(s): SBK
Wrap Text

SBK - Standard Bank - Firm Intention To Make An Offer Standard Bank Group Limited Registration No. 1969/017128/06 Incorporated in the Republic of South Africa JSE share code: SBK NSX share code: SNB ISIN: ZAE000109815 ("Standard Bank") FIRM INTENTION ON THE PART OF STANDARD BANK TO MAKE AN OFFER TO ACQUIRE THE ISSUED ORDINARY SHARE CAPITAL OF LIBERTY HOLDINGS THAT IT DOES NOT ALREADY OWN 1. INTRODUCTION The shareholders of Standard Bank are advised that Standard Bank has notified the board of directors of Liberty Holdings Limited ("Liberty Holdings") ("the Liberty Holdings Board") of its firm intention to acquire the remaining 20 044 474 shares (40.83%) of the issued ordinary share capital of Liberty Holdings which Standard Bank does not already own ("the Offer Shares") ("the Offer"). The consideration payable in terms of the Offer will be 21 925 cents per ordinary share in cash ("the Consideration"). If all Liberty Holdings shareholders accept the Offer, the aggregate maximum Consideration will amount to R4.4 billion in cash. Standard Bank directly owns 29 046 248 ordinary shares in Liberty Holdings, representing 59.17% of the issued ordinary share capital of Liberty Holdings and does not hold any options to acquire any Offer Shares. Standard Bank`s indirect subsidiaries Liberty Group Limited ("Liberty") and Stanlib Limited ("Stanlib") from time to time invest on behalf of policyholders in, or manage funds invested in, Liberty Holdings. Based on the latest publicly available information, Liberty controls 2 719 008 ordinary shares in Liberty Holdings, while Stanlib manages 1 089 408 ordinary shares in Liberty Holdings, which respectively represent 5.54% and 2.22% of the issued ordinary share capital of Liberty Holdings. 2. RATIONALE Standard Bank has controlled Liberty through its shareholding in Liberty Holdings, since 1999. Standard Bank`s effective economic interest in Liberty amounts to approximately 33%. Standard Bank wishes to increase its effective economic interest in Liberty as part of rebalancing its portfolio of financial services subsidiaries and to align its economic exposure with its strategic and commercial contribution to Liberty. Should all Liberty Holdings shareholders accept the offer, based on 2007 earnings, Liberty`s earnings will constitute over 11% of Standard Bank`s headline earnings, up from 7% currently. Following the Industrial and Commercial Bank of China transaction, which was concluded in March this year, Standard Bank has the necessary capital resources to finance the purchase of additional shares in Liberty Holdings without reducing the growth potential of the group`s banking operations. 3. MECHANISM OF THE OFFER The Offer will be implemented by way of an unconditional offer by Standard Bank to the shareholders of Liberty Holdings other than Standard Bank ("the Offerees") in terms of Chapter XVA of the Companies Act, 1973 ("the Act"). Should the Offer be accepted by Offerees in respect of nine-tenths or more of the Offer Shares, Standard Bank reserves the right to invoke the provisions of Section 440K of the Act to compulsorily acquire all such Offer Shares in respect of which the Offer was not accepted and apply for the termination of the listing of the ordinary shares of Liberty Holdings on the exchange operated by the JSE Limited ("the JSE"). If Section 440K of the Act cannot be invoked or Standard Bank elects not to invoke the provisions of Section 440K of the Act, Liberty Holdings will continue as a listed company in respect of both its ordinary and preference shares. It is currently expected that the circular containing further details in respect of the Offer will be posted on or about 30 June 2008 and that the Offer will close for acceptances on or about 25 July 2008. 4. TERMS OF THE OFFER The Consideration payable in terms of the Offer, which will be unconditional as to acceptances, will be a cash payment of 21 925 cents per Offer Share. The Consideration represents a premium of 23.2% to the closing price of Liberty Holdings ordinary shares on 26 May 2008. Standard Bank`s intention is to offer Liberty Holdings shareholders the opportunity to realise their investments for cash and to re-invest in Liberty ordinary shares representing an approximately equivalent economic exposure. Standard Bank anticipates that shareholders may be subject to taxes and brokerage costs in order to re-invest. Standard Bank estimates that a premium of 6% to the value of the underlying investment held by Liberty Holdings in Liberty should compensate the vast majority of long term shareholders for such costs. The Consideration therefore represents: - a premium of 6.0% to the 5 trading day volume weighted average value of the underlying investment held by Liberty Holdings in Liberty together with the cash held by Liberty Holdings less the market value of Liberty Holdings` listed preference shares divided by the aggregate number of Liberty Holdings ordinary shares in issue ("See-Through Value") to 26 May 2008; and - a premium of 7.6% to the closing See-Through Value of Liberty Holdings ordinary shares on 26 May 2008. 5. CASH CONFIRMATION Goldman Sachs International has, as required in terms of the Securities Regulation Code and the Rules of the Securities Regulation Panel, provided a cash confirmation to the Securities Regulation Panel confirming that Standard Bank has sufficient cash resources available to satisfy the full cash consideration payable in terms of the Offer. Johannesburg 27 May 2008 Investment bank and financial adviser to Standard Bank Standard Bank Financial adviser to Standard Bank Goldman Sachs International Independent sponsor to Standard Bank Deutsche Securities (SA) (Proprietary) Limited Legal advisers to Standard Bank Bowman Gilfillan Date: 27/05/2008 17:42:50 Supplied by www.sharenet.co.za Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on, information disseminated through SENS.

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