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MVG / MVGP - Mvelaphanda Group Limited - Disposal of life healthcare group holdings limited ("LIFE HEALTHCARE") shares Mvelaphanda Group Limited Incorporated in the Republic of South Africa Registration number: 1995/004153/06 Ordinary share code: MVG Preference share code MVGP Ordinary share ISIN: ZAE000060737 Preference share ISIN: ZAE000073540 ("Mvela Group" or "the Company") DISPOSAL OF LIFE HEALTHCARE GROUP HOLDINGS LIMITED ("LIFE HEALTHCARE") SHARES 1. INTRODUCTION Shareholders of Mvela Group are advised that the Company disposed of 3 million Life Healthcare ordinary shares ("Life Healthcare shares") on the JSE Limited ("JSE") open market during the period 7 February 2011 to 31 March 2011 ("the open market disposals"). The cash consideration received in respect of the open market disposals amounted to approximately R45.7 million. Further, the Company disposed of 9 million Life Healthcare shares to Laurium Capital (Proprietary) Limited ("Laurium Capital") for a cash consideration of R139 million on 4 and 5 April 2011. The open market disposals and the disposal to Laurium Capital are collectively referred to as "the Disposal". 2. NATURE OF BUSINESS OF LAURIUM CAPITAL * Laurium Capital is an investment manager running various funds investing in Sub-Saharan Africa. * Laurium Capital was formed in 2008 and is based in Johannesburg South Africa. * Laurium Capital has over 60 years aggregate investment experience between 2 principals and 4 investment professionals. 3. RATIONALE The Disposal is part of Mvela Group`s overall value unlocking strategy to realise value for its shareholders. The proceeds from the sale will be used to pay down certain debt of portfolio companies. 4. CONSIDERATION RECEIVED The total cash consideration received in respect of the Disposal is approximately R184 million net of all transaction costs. The sale proceeds of the Disposal will be utilised to pay down certain debt of portfolio companies. 5. CATEGORISATION OF THE DISPOSAL In terms of the JSE Listings Requirements, the Disposal is categorised as a category 2 transaction. 6. FINANCIAL EFFECTS The unaudited pro forma financial effects of the Disposal set out below have been prepared to assist Mvela Group shareholders in assessing the impact of the Disposal on the Company`s historical earnings per ordinary share ("EPS"), headline earnings per ordinary share ("HEPS"), net asset value per ordinary share ("NAVPS") and net tangible asset value per ordinary share ("NTAVPS"). The pro forma financial effects are the responsibility of the directors of Mvela Group and are provided for illustrative purposes only. The pro forma financial effects have been prepared on the basis that the Disposal had been fully implemented on 1 July 2010 for Income Statement purposes and as at 31 December 2010 for purposes of the Statement of Financial Position. It does not purport to be indicative of what the consolidated financial results would have been had the Disposal been implemented on a different date. The material assumptions are set out in the notes following the table. Due to their nature, the pro forma financial effects may not fairly present the financial position, changes of equity, results of operations or cash flows of Mvela Group after the Disposal. The net value of and the after tax profits attributable to the net assets of Life Healthcare are R155 093 597 and R18 459 398 respectively. The Company`s remaining investment in Life Healthcare after the Disposal amounts to 22 385 280 Life Healthcare shares or 2,15% of the total issued Life Healthcare shares. Before the After the Percentage Disposal(1) Disposal change (%) EPS (cents) (53,6) (53,6) 0% HEPS (cents) (0,7) (0,6) 14,29% NAVPS (cents) 359,2 365,1 1,64% NTAVPS (cents) 359,2 365,1 1,64% Weighted average number of 458 467 458 467 0% shares in issue* (`000) Net number of ordinary 565 474 565 474 0% shares in issue (`000) * excludes treasury shares Notes: 1. Extracted from Mvela Group`s published unaudited interim results for six months ended 31 December 2010. 2. The pro forma adjustments to the statement of comprehensive income and the statement of financial position have been calculated on the assumption that the Disposal was implemented on 1 July 2010 and 30 December 2010 respectively. 3. The proceeds received from the Disposal of R184 million have been used to reduce interest bearing debt of portfolio investments. 4. Interest paid has been reduced by R6 million as a result of the Disposal proceeds applied to interest bearing debt. Taxation of R1,7 million claimed in respect of this has been reversed. 5. A profit on the Disposal of R18,5 million has been recognised being the difference between the fair value of Life Healthcare shares at 1 July 2010 of R13,55 per share and the net proceeds received on the Disposal of R184 million. 6. A deferred taxation liability of R18 627 933 as at 1 July 2010 has been set off against the CGT incurred on the profit from the Disposal. 7. The fair value adjustment of R12 981 955 less CGT of R1 817 474 provided for the six months ended 31 December 2010 have been reversed. 8. The pro forma financial effects have been prepared using the same accounting policies as those applied in the most recently published annual financial statements of Mvela Group. 7 April 2011 Sponsor Deutsche Securities (SA) (Proprietary) Limited Date: 07/04/2011 17:05:02 Supplied by www.sharenet.co.za Produced by the JSE SENS Department. 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