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LAB - Further announcement relating to Aurora Empowerment Systems (Pty)
Limited acquiring control of Labat and changes to the board of directors
LABAT AFRICA LIMITED
Incorporated in the Republic of South Africa
(Registration number 1986/001616/06)
JSE code: LAB
ISIN: ZAE000018354
("Labat" or the "company")
FURTHER ANNOUNCEMENT RELATING TO AURORA EMPOWERMENT SYSTEMS (PTY) LIMITED
ACQUIRING CONTROL OF LABAT AND CHANGES TO THE BOARD OF DIRECTORS
1. INTRODUCTION
Further to the announcement dated 7 April 2010, shareholders are advised
that Cyandara 131 (Pty) Limited , trading as Aurora Investment Holdings
("AIH") a wholly owned subsidiary of Aurora Empowerment Systems (Pty)
Limited ("Aurora"), Link Private Equity and Investments (Pty) Limited
("Link") and Labat have entered into agreements to amend the terms and
conditions of previous agreements.
In terms of the new agreements:
1.1 Link sells the 90 106 335 Labat shares it owns ("sale shares")
(approximately 45.7% of the issued share capital of Labat) to AIH
for a cash consideration of 5 cents per share ("the sale of the Link
shares"). Ownership of the sale shares has now passed to AIH.
1.2 Link will acquire from Labat the business of Labat which is known as
the SAMES business, conducted by Labat as at 21 July 2010, including
all the fixed assets of Labat, the cash at bank, debtors, claims and
all liabilities of Labat (but excluding the Primose acquisition and
related assets (refer paragraph 2) and also excluding the Link loan
detailed in paragraph 1.4), as a going concern as well as all the
issued shares in all subsidiaries of Labat, being South African
Micro Electronic Systems (Pty) Limited ("SAMES"), Integrated Circuit
Design Centre (Pty) Limited ("ICDC") and Labat Africa Consulting
(Pty) Limited ("LAC") for a combined purchase consideration of R4
505 317 ("the SAMES disposal").
The effective date of the SAMES disposal is one business day after
the earlier of the Primrose acquisition (refer paragraph 2) becoming
unconditional or lapsing as a result of the failure of any
conditions precedent contained therein.
The remaining suspensive conditions relating to the SAMES disposal
are:
- approval of the SAMES disposal in terms of the JSE Limited
("JSE") Listings Requirements at a general meeting of Labat
shareholders and in terms of section 228 of the Companies Act
(if required); and
- all other regulatory approvals required, including but not
limited to the approval by the JSE and the Securities
Regulation Panel ("SRP").
1.3 Link will loan Labat up to R4 million, ("the Link loan") which will
be offset against the purchase consideration of the SAMES disposal.
1.4 Mr DJ O`Neill, Mr VJ Labat and Mr R Mohamed have resigned from the
board of Labat with immediate effect. Mr Brian van Rooyen has agreed
to stay on the Labat board as a Non-Executive director. The
following have been appointed with immediate effect to the board of
Labat:
- Mr Khulubuse Clive Zuma (non-executive chairman);
- Mr Zondwa Zoyisile Gadaffi Mandela (chief executive officer);
- Mr Michael Hulley (independent non-executive director); and
- Mr Sheshile Thulani Zwelihle Ngubane (executive director).
Mr A Britto has resigned as company secretary with immediate effect
and a new company secretary will be appointed in due course.
2. PRIMROSE ACQUISITION
Shareholders are referred to the announcement dated 20 July 2010
containing details of the acquisition by Labat of the gold processing and
smelting operations known as Primrose Gold Metallurgical as well as ERPM
Gold Metallurgical from Primrose Gold Mines (Pty) Limited, a wholly-owned
subsidiary of Aurora ("Primrose acquisition").
3. MANDATORY OFFER
As previously announced, the sale of the Link shares at 5 cents per share
constitutes an "affected transaction" as defined in the Securities
Regulation Code on Take-overs and Mergers ("SRP Code") and, accordingly,
AIH is obliged to make an offer at 5 cents per share to the shareholders
of Labat other than Link in accordance with the provisions of the SRP
Code ("the mandatory offer").
Neither Aurora nor AIH hold any securities in Labat. A subsidiary of
Aurora will, subject to regulatory approvals, be issued with 38 000 000
Labat shares as consideration for disposing of assets to Labat in terms
of the Primrose acquisition.
Shareholders holding approximately 21,3% of the issued share capital of
Labat have irrevocably agreed to accept the mandatory offer. This,
together with the sale shares and the shares to be issued to a subsidiary
of Aurora in terms of the Primrose acquisition, will bring Aurora`s
effective shareholding in Labat to approximately 72.3%.
4. CONFIRMATION OF FINANCIAL RESOURCES
As previously announced, the attorneys to Aurora, Amod`s Attorneys, have
provided the SRP with confirmation of availability of cash resources to
satisfy the full cash consideration payable in terms of the mandatory
offer.
5. REINVESTMENT OPTION - SUBSCRIPTION FOR SAMES SHARES
As previously announced, following the implementation of the SAMES
disposal, Labat shareholders who accept the mandatory offer will be
provided the opportunity to subscribe for shares in SAMES on terms and
conditions comparable to the price at which Link has offered for SAMES.
6. FINANCIAL EFFECTS OF THE DISPOSAL
The announcement dated 7 April 2010 contained financial effects of the
disposal.
7. DOCUMENTATION
The SAMES disposal constitutes a related party transaction in terms of
the JSE Listings Requirements as Messrs BG van Rooyen, DJ O`Neill and VJ
Labat are directors of Labat and also shareholders of Link. The SAMES
disposal is also potentially an affected transaction in terms of the SRP
Code which will, if considered as such, require 75% of disinterested
shareholders to vote in favour of the disposal. A circular, containing
details of the matters set out above and incorporating a notice of a
general meeting of shareholders will be posted to Labat shareholders in
due course.
8. OPINIONS
The Labat board has appointed PKF Corporate Finance (Pty) Limited as
independent adviser to assist it in considering the terms of the
mandatory offer and the disposal and to provide it with the external
advice required in terms of the SRP Code and the JSE Listings
Requirements.
Sandton
23 July 2010
Corporate adviser and sponsor to Labat
Vunani Corporate Finance
Legal adviser to Labat
Eversheds
Independent expert
PKF Corporate Finance (Pty) Limited
Corporate adviser to Aurora
Arcay Moela Sponsors (Pty) Ltd
Date: 23/07/2010 11:59:01 Supplied by www.sharenet.co.za
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