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CCO - Capital & Counties Properties PLC - Placing to fund acquisition

Release Date: 05/05/2011 08:01
Code(s): JSE CCO
Wrap Text

CCO - Capital & Counties Properties PLC - Placing to fund acquisition opportunities at Covent Garden Capital & Counties Properties PLC (Incorporated and registered in the United Kingdom and Wales with registration Number 07145041 and registered in South Africa as an external company with Registration Number 2010/003387/10) JSE code: CCO ISIN: GB00B62G9D36 NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA OR JAPAN 05 May 2011 Capital & Counties Properties PLC ("Capco" or the "Company") Placing to fund acquisition opportunities at Covent Garden Capco today announces the underwritten placing of up to 62,100,000 new ordinary shares of 25 pence in the capital of the Company (the "Placing") representing approximately 9.99 per cent. of the Company`s issued share capital immediately prior to the Placing. Highlights of the Placing - Underwritten placing of up to 62,100,000 new ordinary shares - Capco`s strategy of improving rental levels at Covent Garden is ahead of plan and the Board sees further opportunities to extend this strategy through further near-term acquisitions across the estate - Proceeds of the Placing will predominantly be used to fund acquisitions and also the ongoing repositioning of assets at Covent Garden Background to and reasons for the Placing At the time of the demerger from Liberty International PLC (now Capital Shopping Centres Group PLC) (the "Demerger"), Capco was allocated sufficient capital to undertake and complete the strategies outlined at that time for each of its estates. Capco has made significant progress implementing those strategies, in particular in respect of Covent Garden and the Earls Court site, where it continues to see significant opportunity for value creation. In the Covent Garden estate, progress is ahead of plan and as a result the Company sees an opportunity to extend its strategy further across the estate. This strategy includes: - increasing prime space within the estate, and therefore increasing average rental levels; - improving both the retail and food & beverage (F&B) tenant mix; - growing the estate through acquisitions to strengthen Capco`s influence across the area; - pursuing change of use strategies where profitable to do so, focusing particularly on converting upper floors currently used for offices to residential usage; and - creating new space through renovation and redevelopment. Highlights for the Covent Garden estate since the Demerger include: - attracting a number of new high-profile tenants as part of the repositioning of the estate, including Rugby Ralph Lauren, Burberry Brit, Laduree and Balthazar; - ERV as at 31 December 2010 was GBP37.5 million, up 12 per cent. on a like- for-like basis since 31 December 2009, under-pinning the valuation uplift of the estate in 2010 of 14 per cent. The initial ERV target for the estate of GBP40 million by December 2012 has been increased to a range of GBP43 - GBP45 million by December 2013; - continuing tenant management contributing to increased rental tone and ERV. In 2010, top level prime rentals on James Street have been achieved at levels of 10 per cent. over the previous passing rent, and a total of 74 leasing transactions were completed at a level 9 per cent. above December 2009 ERV levels. This progress has continued with leasing transactions in 2011 achieving an average of 2.6 per cent. above ERV at the point of lease activity; - acquiring 37 King Street and 1a Henrietta Street (through an asset swap); and - creating opportunities for further flagship retail units (subject to planning consent) at Russell Chambers and 1a Henrietta Street. Of the GBP75 million allocated at the time of the demerger for capital expenditure on the Covent Garden estate, GBP19 million has been spent and a further GBP15 million committed on a number of initiatives including lease buybacks, the redevelopment at Flower Cellars and the residential conversion at 34 Henrietta Street. The remaining capital is earmarked for identified projects across the estate, certain of which are subject to planning consent. Capco`s strategy at Covent Garden, to date, has focused on the repositioning of existing assets together with some small infill acquisitions. Capco has identified a number of potential acquisitions of various sizes across Covent Garden that the Board believes will become available in the coming months, which would offer the opportunity to consolidate Capco`s ownership in the area and present repositioning opportunities in line with the strategies applied to Capco`s existing estate. One such opportunity, which is of meaningful scale, is currently under discussion and, if it proceeds, would be expected to sign in the short term. The Company expects that any such acquisitions would be at or around valuation yields consistent with those of Capco`s existing properties at Covent Garden. Expected benefits of the Placing The Board expects that the acquisitions and projects at Covent Garden, which will be funded with the proceeds of the Placing, will accelerate Capco`s strategy to create a contemporary luxury destination and will be accretive to both ERV and net asset value per share over time. The returns on capital expenditure are expected to be similar to those achieved on previous spend across the Covent Garden estate. Conference call There will be a conference call at 8.30am BST on 05 May 2011 to discuss this announcement. A copy is available for download from our website at www.capitalandcounties.com and hard copies can be requested via the website or by contacting the company (email feedback@capitalandcounties.com or telephone +44 (0)20 3214 9153). Interim Management Statement The following is the text from the Interim Management Statement which has been separately released today. Highlights - The repositioning of the Covent Garden estate continues apace with the opening of Burberry Brit in April 2011, and further key store openings due throughout the year including Rugby Ralph Lauren, Laduree and Links of London - Good progress has been made with the conversions at 34 Henrietta Street and the Flower Cellars (for Balthazar) - The public launch of Sir Terry Farrell`s masterplan for the Earls Court & West Kensington Opportunity Area (ECOA) was well received with over 1,000 visitors attending the exhibition - The supplementary planning document for the ECOA was published for consultation in March by the London Borough of Hammersmith & Fulham, the Royal Borough of Kensington & Chelsea and the Greater London Authority Covent Garden The positive momentum generated in Covent Garden in 2010 has continued with the openings of Burberry Brit on King Street and Liam Gallagher`s fashion concept Pretty Green on the East Piazza. This affirms the estate as the new destination for contemporary luxury in the West End. With a number of additional openings including Rugby Ralph Lauren, Links of London, Laduree and Balthazar anticipated throughout the year, demand remains strong from high quality retail and restaurant brands with offers at or above ERV being received for available space. Letting transactions in 2011 to date have been concluded at an average of 2.6 per cent. above ERV at the point of lease activity. In addition discussions are advanced with an international brand for a new concept for the second retail unit which will be created from the site previously occupied by Ponti`s. Footfall for the 12 month period from April 2010 to March 2011 was 45.4 million. The EPRA adjusted occupancy rate for the estate was 96.4 per cent. as at 31 March 2011. Work is due to start on site at the Flower Cellars, to transform this for Balthazar, in May and ongoing improvement works to the Market Building and the public realm continue. Construction continues at 34 Henrietta Street to create the first four premium apartments under the Covent Garden Living brand. The work is on track and due to be completed in December. Expressions of interest have already been received for the three large scale units and a penthouse and demand is expected to be strong when they are delivered to market. A planning application has been made to create a further four apartments in Russell Chambers, another high profile site overlooking the piazza. Plans for the recently acquired 1a Henrietta Street are also taking shape to create a new flagship commercial and residential space anchoring the south west corner of the piazza. A planning application for the scheme will be made in the second half of the year. Earls Court & Olympia The events business has had a good first quarter with 82 per cent. of the annual budgeted licence fees contracted as at 31 March 2011. The International Gaming Exhibition, Toy Fair and the Retail Business Expo were notable successes and performed over budget. However, certain shows, including BETT and Top Gear Live, have been lost reflecting the competitive nature of the market. In February, Emap achieved a first taking over both Earls Court and Olympia, and in March the reinvigorated Ideal Home Show brought over 270,000 visitors to Earls Court. This year`s highlight was `The Prince`s House`, HRH The Prince of Wales`s eco-living concept, a low carbon home made from natural and recycled materials. At Olympia, construction on the new 90,000 sq ft exhibition space to replace the West Hall continues on time and on budget. ECOA masterplan The planning process for the Earls Court & West Kensington Opportunity Area (ECOA) has seen an active start to the year and has continued to progress well. An exhibition to launch Sir Terry Farrell`s masterplan for the ECOA was held at Earls Court and was visited by over 1,000 people from the local area including residents, businesses, amenity groups and students from local schools and universities. Community stakeholders were able to view a range of new and improved social and physical infrastructure solutions and discuss the overall benefits of the scheme with members of the project team. The masterplan was published online at our consultation website myearlscourt.com to coincide with the exhibition. A major milestone for the ECOA in the period included the publication for consultation of the site specific planning guidance document (the Supplementary Planning Document) by the London Borough of Hammersmith & Fulham (LBHF), the Royal Borough of Kensington & Chelsea and the Greater London Authority. The first stage of consultation concluded in April, coinciding with the conclusion of the LBHF Core Strategy Examination in Public. The Mayor of London confirmed in a press release on 3 May 2011 that the Planning Inspectorate has reported on the draft Replacement London Plan, which includes ECOA as an opportunity area suitable for comprehensive development, concluding that it offers "a sound basis for planning"; the Plan will now be submitted to the Secretary of State for approval. Negotiations are progressing with Transport for London (TfL) in respect of the re-gearing of Capco`s long leasehold interests at Earls Court and also with TfL and LBHF in respect of future development rights over the ECOA. We remain on track to submit planning applications by the end of June. The Great Capital Partnership The Partnership continues to benefit from its focus on London`s West End showing modest growth in both rental and capital values. Occupancy levels have reduced to 92.1 per cent., as at 31 March 2011, principally as a result of a lease expiry during the quarter. The sale of 201/207 Kensington High Street, for cash consideration of GBP12.8 million (Capco`s share GBP6.4 million) was completed in April. Further divestments of mature non-core assets are under consideration. Other The realisation of our investments in China continues with a number of contracted sales now completed. These sales released approximately GBP5 million in the first quarter and GBP32 million in April 2011. Further sales have been contracted and are planned to complete over the next 12 months. Finance As at 31 March 2011, gross debt was GBP644 million and the cash balance was GBP158 million, resulting in net debt of GBP486 million (31 December 2010 GBP476 million). Based on 31 December 2010 property values, the 31 March 2011 pro forma debt to assets ratio was 35 per cent. (31 December 2010 35 per cent.). Following the 12-month extension agreed in February 2011 to the facility secured over Earls Court & Olympia, the Group`s weighted average debt maturity at 31 March 2011 was 3 years (31 December 2010 3 years) and the weighted average cost of gross debt was 5.9 per cent. (31 December 2010 5.9 per cent.) with 96 per cent. of the debt hedged into fixed interest rates. As at 31 March 2011 Capco had capital commitments of GBP35.7 million. Dividends The Company has declared a final dividend of 1 pence per Ordinary Share with respect to the year ended 31 December 2010, making a total dividend for the full year ended 31 December 2010 of 1.5 pence per Ordinary Share. It is currently intended that the Company will pay a dividend of 1.5 pence per Ordinary Share for the year ending 31 December 2011. It remains the Company`s intention to grow the dividend as the success of its asset plans is reflected in underlying profitability, taking into account the level of any future commitments. Details of the Placing Under the terms of the Placing, Capco intends to place up to 62,100,000 new ordinary shares of 25 pence each in the capital of the Company (the "Placing Shares"), representing approximately 9.99 per cent. of the current issued ordinary share capital of the Company as at 04 May 2011. Placees may participate in the Placing in Sterling or in Rand. The number of Rand Placing Shares will represent a maximum of 30 per cent. of the total number of Placing Shares. Investors who participate in the Placing in Rand will be required to make bids for Placing Shares in Sterling. UBS Limited ("the Bookrunner") will confirm the final Rand/Sterling exchange rate for determination of the final Rand Placing Price at the time that pricing and allocations take place. Further details of the exchange rate determination can be found in the terms and conditions contained in the Appendix to this Announcement under the heading "Participation in, and principal terms of, the Placing". The Placing is being conducted, subject to the satisfaction of certain conditions, through an accelerated bookbuild process (the "Bookbuild") to be carried out by the Bookrunner. The book will open with immediate effect. The Bookbuild is expected to close no later than 4.30 p.m. (London time) today but may be closed earlier or later at the discretion of the Bookrunner. The Bookrunner may, in agreement with the Company, accept bids that are received after the Bookbuild has closed. The Placing Price and the number of Placing Shares will be agreed between the Bookrunner and the Company following completion of the Bookbuild and will then be announced on a Regulatory Information Service (the "Pricing Announcement"). The Placing has been fully underwritten by the Bookrunner, subject to the conditions set out in the placing agreement between the Company and the Bookrunner. A description of the placing agreement can be found in the terms and conditions contained in the Appendix to this announcement under the heading "Participation in, and principal terms of, the Placing". Application will be made for admission of the Placing Shares to the Official List of the Financial Services Authority and to trading on the London Stock Exchange`s main market for listed securities ("UK Admission"). The Company will also apply to the Johannesburg Stock Exchange for the listing of the Placing Shares on the Main Board of the Johannesburg Stock Exchange. It is expected that the Admission and listing of the Placing Shares on the London Stock Exchange and the Johannesburg Stock Exchange will become effective on 10 May 2011. The Placing Shares will, when issued, be credited as fully paid and rank pari passu with the existing ordinary shares of 25 pence each in the capital of the Company including the right to receive all future dividends and distributions declared, made or paid (excluding the 2010 final dividend). The Placing is conditional upon, inter alia, UK Admission becoming effective. The Placing is also conditional upon the placing agreement between the Company and the Bookrunner not being terminated. The Appendix to this Announcement (which forms part of the Announcement) sets out the terms and conditions of the Placing. Enquiries Capital & Counties Properties PLC Ian Hawksworth Chief Executive +44 (0)20 3214 9188 Soumen Das Finance Director +44 (0)20 3214 9183 Rothschild +44 (0)20 7280 5000 Alex Midgen Duncan Wilmer UBS Limited +44 (0)20 7567 8000 Hew Glyn Davies Jonathan Bewes Fergus Horrobin Christopher Smith UBS South Africa (Proprietary) Limited +27 11 322 7000 Martin Nel Hudson Sandler +44 (0)20 7796 4133 Michael Sandler / Wendy Baker College Hill +27 (0)11 447 3030 Nicholas Williams IMPORTANT NOTICE This announcement includes statements that are, or may be deemed to be, "forward-looking statements", including within the meaning of Section 27A of the Securities Act and Section 21E of the US Exchange Act of 1934. These forward-looking statements can be identified by the use of a date in the future or forward-looking terminology, including, but not limited to, the terms "may", "believes", "estimates", "plans", "aims", "targets", "projects", "anticipates", "expects", "intends", "may", "will", "could" or "should" or, in each case, their negative or other variations or comparable terminology. These forward-looking statements include matters that are not historical facts and include statements regarding Capco`s intentions, beliefs or current expectations. By their nature, forward-looking statements involve risk and uncertainty because they relate to future events and circumstances. A number of factors could cause actual results and developments to differ materially from those expressed or implied by the forward-looking statements. Any forward- looking statements in this announcement reflect Capco`s view with respect to future events as at the date of this announcement and are subject to risks relating to future events and other risks, uncertainties and assumptions relating to Capco`s operations, results of operations, financial condition, growth, strategy, liquidity and the industry in which Capco operates. No assurances can be given that the forward-looking statements in this announcement will be realised. Capco undertakes no obligation and does not intend to revise or update any forward-looking statements in this announcement to reflect events or circumstances after the date of this announcement. Neither the content of the Company`s website nor any website accessible by hyperlinks to the Company`s website is incorporated in, or forms part of, this Announcement. This Announcement is for information purposes only and shall not constitute an offer to buy, sell, issue, or acquire, or the solicitation of an offer to buy, sell, issue, or acquire any securities in any jurisdiction, nor shall there be any sale of securities in any jurisdiction, in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. In particular, this Announcement does not constitute or form part of any offer to issue or sell, or the solicitation of an offer to acquire, purchase or subscribe for, any securities in the United States, Australia, Canada or Japan. The securities mentioned herein have not been and will not be registered under the US Securities Act of 1933, as amended (the "US Securities Act"), or under any securities laws of any State or other jurisdiction of the United States and may not be offered, sold, resold, transferred or delivered, directly or indirectly, within the United States except pursuant to an applicable exemption from the registration requirements of the US Securities Act and in compliance with the securities laws of any State or other jurisdiction of the United States. There will be no public offer of the securities mentioned herein in the United States. This Announcement may not be released, published or distributed, directly or indirectly, in whole or in part, in or into the United States. This announcement has been issued by, and is the sole responsibility of, the Company. Neither UBS Limited nor any of its affiliates, parent undertakings, subsidiary undertakings or subsidiaries of its parent undertakings (such entities together, "UBS") or any of its respective directors, officers, employees or advisers or any other person accepts any responsibility whatsoever and makes no representation or warranty, express or implied, for or in respect of the contents of this announcement and, without prejudice to the generality of the foregoing, no responsibility or liability is accepted by any of them for any such information or opinions or for any errors or omissions. UBS is acting exclusively for Capco and no one else in connection with the Placing, UK Admission and SA Admission and will not regard any other person (whether or not a recipient of this document) as a client in relation to the Placing, UK Admission and SA Admission and will not be responsible to anyone other than Capco for providing the protections afforded to its clients or for providing advice in relation to the Placing, UK Admission, SA Admission or any transaction, arrangement or other matter referred to in this document. The Placing Shares will be regarded as approved inward listed instruments for South African Exchange Control purposes. All South African corporates, trusts, partnerships and private individuals may participate in the Placing without restriction. However, South African resident institutional investors should be aware that the South African Exchange Control Regulations will apply to their participation in the Placing. Placing shares will count immediately towards South African institutional investors` offshore allowance. South African resident institutional investors will need to ensure that they have capacity within their foreign investment portfolios to acquire Placing Shares. The price of shares and the income from them may go down as well as up and investors may not get back the full amount invested on disposal of the shares. APPENDIX TERMS AND CONDITIONS IMPORTANT INFORMATION FOR PLACEES ONLY REGARDING THE PLACING MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE PLACING. THE TERMS AND CONDITIONS SET OUT HEREIN ARE DIRECTED ONLY AT PERSONS WHOSE ORDINARY ACTIVITIES INVOLVE THEM IN ACQUIRING, HOLDING, MANAGING AND DISPOSING OF INVESTMENTS (AS PRINCIPAL OR AGENT) FOR THE PURPOSES OF THEIR BUSINESS AND WHO HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS AND ARE (1) QUALIFIED INVESTORS AS DEFINED IN SECTION 86(7) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 AS AMENDED ("FSMA"), BEING PERSONS FALLING WITHIN THE MEANING OF ARTICLE 2.1(e)(i), (ii) OR (iii) OF DIRECTIVE 2003/71/EC (THE "PROSPECTUS DIRECTIVE") AND (2) IN THE UNITED KINGDOM FALL WITHIN ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005, AS AMENDED (THE "ORDER") OR ARE PERSONS WHO FALL WITHIN ARTICLE 49(2)(a) TO (d) ("HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS, ETC") OF THE ORDER AND (3) HAVE BEEN INVITED TO PARTICIPATE IN THE PLACING BY THE BOOKRUNNER (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS "RELEVANT PERSONS"). THIS ANNOUNCEMENT AND THE TERMS AND CONDITIONS SET OUT HEREIN MUST NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. PERSONS DISTRIBUTING THIS ANNOUNCEMENT MUST SATISFY THEMSELVES THAT IT IS LAWFUL TO DO SO. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THIS ANNOUNCEMENT AND THE TERMS AND CONDITIONS SET OUT HEREIN RELATES IS AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS. THIS ANNOUNCEMENT DOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR SUBSCRIPTION OF ANY SECURITIES IN CAPCO. THE SECURITIES HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE US SECURITIES ACT OF 1933, AS AMENDED (THE "US SECURITIES ACT") OR UNDER THE LAWS OF ANY STATE OR OTHER JURISDICTION OF THE UNITED STATES, AND MAY NOT BE OFFERED, SOLD, TRANSFERRED OR DELIVERED DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES EXCEPT PURSUANT TO AN EXEMPTION FROM OR IN A TRANSACTION NOT SUBJECT TO THE REGISTRATION REQUIREMENTS OF THE US SECURITIES ACT AND IN COMPLIANCE WITH THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION OF THE UNITED STATES. NO MONEY, SECURITIES OR OTHER CONSIDERATION FROM ANY PERSON INSIDE THE UNITED STATES IS BEING SOLICITED BY THIS ANNOUNCEMENT AND IF SENT IN RESPONSE TO INFORMATION CONTAINED IN THIS ANNOUNCEMENT, WILL NOT BE ACCEPTED. THIS ANNOUNCEMENT AND ANY OFFER IF MADE SUBSEQUENTLY IS ONLY ADDRESSED TO AND DIRECTED AT PERSONS IN MEMBER STATES OF THE EUROPEAN ECONOMIC AREA ("EEA") WHO ARE "QUALIFIED INVESTORS" WITHIN THE MEANING OF ARTICLE 2(1)(E) OF THE PROSPECTUS DIRECTIVE (DIRECTIVE 2003/71/EC) ("QUALIFIED INVESTORS"). By participating in the Bookbuilding Process and the Placing, Placees will be deemed to have read and understood this Appendix and the remainder of this Announcement in its entirety, and to be participating, making an offer and acquiring Placing Shares on the terms and conditions contained herein and to be providing the representations, warranties, indemnities, acknowledgements and undertakings contained herein. In particular each such Placee represents, warrants and acknowledges that it: a. is a Relevant Person and undertakes that it will acquire, hold, manage or dispose of any Placing Shares that are allocated to it for the purposes of its business; b. in the case of a Relevant Person in a member state of the EEA which has implemented the Prospectus Directive (each a "Relevant Member State") who acquires any Placing Shares pursuant to the Placing: i. it is a Qualified Investor; and ii. in the case of any Placing Shares acquired by it as a financial intermediary, as that term is used in Article 3(2) of the Prospectus Directive, that (a) the Placing Shares subscribed for and/or acquired by it in the Placing have not been subscribed for and/or acquired on behalf of, nor have they been or will be acquired with a view to their offer or resale to, persons in any Relevant Member State other than Qualified Investors or in circumstances in which the prior consent of the Bookrunner has been given to the offer or resale; or (b) where Placing Shares have been acquired by it on behalf of persons in any member state of the EEA other than Qualified Investors, the offer of those Placing Shares to it is not treated under the Prospectus Directive as having been made to such persons; and c. is acquiring the Placing Shares for its own account or is acquiring the Placing Shares for an account with respect to which it exercises sole investment discretion and has the authority to make, and does make, the acknowledgements, representations and agreements contained in this Appendix and that it (and any such account) is outside the United States or it is a dealer or other professional fiduciary in the United States acting on a discretionary basis for non-US beneficial owners (other than an estate or trust), and is acquiring the Placing Shares in an offshore transaction in reliance upon Regulation S under the US Securities Act and it is not purchasing the Placing Shares for the account of another person who is resident or located in the United States unless (a) the instruction to purchase was received from a person outside the United States and (b) the person giving such instruction has advised that it has the authority to give such instruction and that either it (i) has investment discretion or authority over such account or (ii) otherwise is purchasing the Placing Shares in an "offshore transaction" within the meaning of Regulation S under the US Securities Act; or if it is not outside the United States, it is a qualified institutional buyer ("QIB") as defined in Rule 144A under the US Securities Act, or purchasing Placing Shares on behalf of a QIB, who will sign a letter in the form agreed between the Company and the Bookrunner ("US Investor Letter") and understands (or, if it is acting for the account of another person, such person has confirmed that such person understands) the resale and transfer restrictions set out in "Representations and further terms" contained herein. This Announcement does not constitute or form part of an offer to sell or issue or the solicitation of an offer to buy or subscribe for Placing Shares in any jurisdiction including, without limitation, the United Kingdom, South Africa, the United States or any Excluded Territory. This Announcement and the information contained herein is not for publication or distribution, directly or indirectly, to persons in the United States or any Excluded Territory or in any jurisdiction in which such publication or distribution is unlawful. No public offering of securities will be made in connection with the Placing in the United Kingdom, South Africa, the United States or elsewhere. The Placing Shares referred to in this Announcement have not been and will not be registered under the US Securities Act or under the securities laws of any State or other jurisdiction of the United States, and may not be offered or sold directly or indirectly in or into the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the US Securities Act and in compliance with the securities laws of any State of the United States. Any offering to be made in the United States will be made to a limited number of QIBs pursuant to an exemption from registration under the US Securities Act in a transaction not involving any public offering. The Placing Shares are being offered and sold outside the United States in accordance with Regulation S under the US Securities Act. The Placing Shares have not been approved or disapproved by the US Securities and Exchange Commission, any State securities commission or any other regulatory authority in the United States, nor have any of the foregoing authorities passed upon or endorsed the merits of the Placing or the accuracy or adequacy of this Announcement. Any representation to the contrary is a criminal offence in the United States. Persons (including without limitation, nominees and trustees) who have a contractual or other legal obligation to forward a copy of this Appendix or this Announcement should seek appropriate advice before taking any action. The Placing Shares are regarded as approved inward listed instruments for South African Exchange Control purposes. All South African corporates, trusts, partnerships and private individuals may participate in the Placing without restriction. However, South African institutional investors should be aware that the South African Exchange Control Regulations will apply to their participation in the Placing. Placing Shares will count immediately towards South African institutional investors` offshore allowances. South African resident institutional investors will need to ensure that they have capacity within their foreign investment portfolios to acquire Placing Shares. The distribution of this Announcement and the Placing and/or issue of the Placing Shares in certain jurisdictions may be restricted by law. No action has been taken by the Company, UBS Limited, or any of their respective Affiliates, that would permit an offer of the Placing Shares or possession or distribution of this Announcement or any other offering or publicity material relating to such Placing Shares in any jurisdiction where action for that purpose is required. Persons into whose possession this Announcement comes are required by the Company and UBS Limited to inform themselves about and to observe any such restrictions. 1. Introduction UBS Limited will today commence the Bookbuilding Process to determine demand for participation in the Placing by Placees. This Appendix gives details of the terms and conditions of, and the mechanics of participation in, the Placing. No commissions will be paid to Placees or by Placees in respect of any Placing Shares. UBS Limited and the Company shall be entitled to effect the Placing by such alternative method to the Bookbuilding Process as they may, in their sole discretion, determine. The Company will apply for admission of the Placing Shares to trading on the main market of the London Stock Exchange and to trading on the main board of the JSE. It is expected that Placing Admission and SA Admission will take place, and that trading in the Placing Shares will commence, on 10 May 2011. The Placing is conditional, inter alia, upon Placing Admission becoming effective and the Placing Agreement not being terminated. It is anticipated that the settlement date will be 10 May 2011. The Placing Shares will, when issued, be subject to the articles of association of the Company and will be issued credited as fully paid and will rank pari passu with the existing Ordinary Shares, including the right to receive all dividends and other distributions declared in respect of such Ordinary Shares after the date of issue of the Placing Shares (excluding the 2010 final dividend). 2. The Placing Agreement UBS Limited has entered into the Placing Agreement with the Company under which, subject to the conditions set out in that agreement, UBS Limited has agreed to use reasonable endeavours to procure Placees for the Placing Shares. In accordance with the terms of the Placing Agreement, UBS Limited has agreed (i) to underwrite the Placing to the extent that Placees cannot be found to participate in the Placing and (ii) to underwrite the settlement risk in the event that any Placees who do participate fail to take up their allocation of Placing Shares. 3. Participation in, and principal terms of, the Placing The principal terms upon which the Placing is to be conducted are set out below: a. UBS Limited is acting as Bookrunner and as agent of the Company. b. Participation in the Placing will only be available to persons who may lawfully be, and are, invited to participate by the Bookrunner. UBS Limited and its respective affiliates are each entitled to enter bids in the Bookbuilding Process as principal. c. The Bookbuilding Process will establish the Sterling Placing Price (in Sterling) and the Rand Placing Price (in Rand), payable to the Bookrunner by all Placees whose bids are successful. The Sterling Placing Price and the Rand Placing Price will be agreed between the Bookrunner and the Company following completion of the Bookbuilding Process. Any discount to the market price of the ordinary shares of the Company will be determined in accordance with the UKLA Listing Rules and, to the extent applicable, the listing requirements of the JSE. The Placing Price and the number of Placing Shares will be announced on a Regulatory Information Service following the completion of the Bookbuilding Process. d. The number of Rand Placing Shares will represent a maximum of 30 per cent. of the total number of Placing Shares e. To bid in the Bookbuilding Process, UK Placees should communicate their bid by telephone to their usual sales or equity capital markets contact at UBS Limited. Each bid should state the number of Placing Shares which the prospective UK Placee wishes to subscribe for at the Sterling Placing Price, which is ultimately established by the Company and the Bookrunner, or at prices up to a price limit specified in its bid. A bid in the Bookbuilding Process will be legally binding on the Placee by which, or on behalf of which, it is made and will not be capable of variation or revocation by such person after the close of the Bookbuilding Process. Bids may be scaled down by the Bookrunner on the basis referred to in, and subject to the limitations in, paragraph 3(l) below. f. To bid in the Bookbuilding Process, SA Placees should communicate their bid by telephone to their usual sales or equity capital markets contact at UBS Limited. Each bid should state the number of Placing Shares which the prospective SA Placee wishes to subscribe for at the Sterling Placing Price, which is ultimately established by the Company and the Bookrunner, or at prices up to a price limit specified in its bid. SA Placees will receive guidance regarding the appropriate Rand/Sterling exchange rate (the "Initial Exchange Rate Guidance") that will be used to calculate the final Rand Placing Price. The final Rand/Sterling exchange rate will be confirmed at the time that pricing and allocations takes place (the "Final Exchange Rate"). SA Placees should be aware that there may be a difference between the Initial Exchange Rate Guidance and the Final Exchange Rate due to intraday movement in the Rand/Sterling exchange rate. g. The Bookbuilding Process is expected to close no later than 4.30 p.m. (London time) on 5 May 2011 but may be closed earlier or later at the discretion of the Bookrunner. The Bookrunner may, in agreement with the Company, accept bids that are received after the Bookbuilding Process has closed. The Company reserves the right to reduce or seek to increase the amount to be raised pursuant to the Placing, in its absolute discretion. h. Each prospective Placee`s allocation will be agreed between the Bookrunner and the Company and will be confirmed orally by the Bookrunner as agent of the Company following the close of the Bookbuilding Process. That oral confirmation will constitute an irrevocable legally binding commitment upon that person (who will at that point become a Placee) in favour of the Company and the Bookrunner to subscribe for the number of Placing Shares allocated to it at the Sterling Placing Price or the Rand Placing Price, as applicable, on the terms and conditions set out in this Appendix and in accordance with the Articles of Association. i. Each prospective UK Placee`s allocation and commitment will be evidenced by a contract note or electronic confirmation issued to such Placee by the Bookrunner. Each prospective SA Placee`s allocation and commitment will be evidenced by an electronic confirmation issued to such Placee by the Bookrunner. The terms of this paragraph 3 will be deemed incorporated in the contract note or electronic confirmation, as applicable. j. Each Placee will also have an immediate, separate, irrevocable and binding obligation, owed to the Bookrunner, to pay to the Bookrunner (or as they may direct) in cleared funds, an amount equal to the product of the Placing Price and the number of Placing Shares such Placee has agreed to subscribe for and the Company has agreed to allot and issue to that Placee. Each Placee`s obligation will be owed to the Company and to the Bookrunner. k. Each Placee to whom Sterling Placing Shares are allotted shall be entered onto the UK Register and each Placee to whom Rand Placing Shares are allotted shall be entered onto SA Register. l. The Bookrunner may choose to accept bids, either in whole or in part, on the basis of allocations determined in agreement with the Company and may scale down any bids for this purpose on such basis as they may determine, provided that the minimum acquisition cost for Placing Shares by any SA Placee, acting as principal, shall be R1 000 000. The Bookrunner may also, notwithstanding paragraphs 3(d), 3(e) and 3(f) above, subject to the prior consent of the Company (i) allocate Placing Shares after the time of any initial allocation to any person submitting a bid after that time and (ii) allocate Placing Shares after the Bookbuilding Process has closed to any person submitting a bid after that time. m. A bid in the Bookbuilding Process will be made on the terms and subject to the conditions in this Appendix and will be legally binding on the Placee on behalf of which it is made and, except with the consent of the Bookrunner, will not be capable of variation or revocation after the time at which it is submitted. n. Except as required by law or regulation, no press release or other announcement will be made by the Bookrunner or the Company using the name of any Placee (or its agent), in its capacity as Placee (or agent), other than with such Placee`s prior written consent. o. Irrespective of the time at which a Placee`s allocation pursuant to the Placing is confirmed, settlement for all Placing Shares to be subscribed for pursuant to the Placing will be required to be made at the same time, on the basis explained under `Registration and Settlement` in paragraph 6 below. p. All obligations under the Bookbuilding Process and Placing will be subject to fulfilment of the conditions referred to under `Conditions to the Placing` in paragraph 4 below and to the Placing not being terminated on the basis referred to below under `Termination of the Placing Agreement` in paragraph 5 below. q. By participating in the Bookbuilding Process, each Placee will agree that its rights and obligations in respect of the Placing will terminate only in the circumstances described below and will not be capable of rescission or termination by the Placee. r. To the fullest extent permissible by law, neither UBS Limited nor any of its respective Affiliates shall have any liability to Placees (or to any other person whether acting on behalf of a Placee or otherwise). In particular, neither UBS Limited nor any of its respective Affiliates shall have any liability (including to the fullest extent permissible by law, any fiduciary duties) in respect of the Bookrunner` conduct of the Bookbuilding Process or of such alternative method of effecting the Placing as the Bookrunner and the Company may agree. 4. Conditions to the Placing The principal conditions to the Placing are set out below: The Placing is conditional upon the Placing Agreement becoming unconditional and not having been terminated in accordance with its terms in respect of the Placing. The obligations of the Bookrunner under the Placing Agreement are, and the Placing is, conditional on, inter alia: a. Placing Admission occurring by not later than 8.00 a.m. (London time) on 10 May 2011 (or such later time and/or date as the Company with the Bookrunner may agree); b. the warranties, representations and undertakings given by the Company in the Placing Agreement being true and accurate and not misleading in any respect on and as of the date of the Placing Agreement and at any time prior to Admission; and c. the fulfilment by the Company of its obligations under the Placing Agreement which are required to be performed or satisfied on or prior to Admission, save to the extent that any non-compliance is not material in the context of the Placing, (all such conditions included in the Placing Agreement being each a "condition" and together the "conditions"). If any condition in the Placing Agreement is not satisfied or waived in accordance with the Placing Agreement within the stated time periods (or such later time and/or date as the Company may agree), or has become incapable of being satisfied or the Placing Agreement is terminated in accordance with its terms, the Placing will lapse and the Placee`s rights and obligations under these terms and conditions shall cease and terminate at such time and each Placee agrees that no claim can be made by or on behalf of the Placee (or any person on whose behalf the Placee is acting) in respect thereof. The Bookrunner may at its absolute discretion and upon such terms as it thinks fit, waive compliance by the Company, or extend the time and/or date for fulfilment by the Company, with the whole or any part of any of the Company`s obligations in relation to the conditions in the Placing Agreement, save that certain conditions including the condition relating to Placing Admission referred to in paragraph 4(a) above may not be waived. Any such extension or waiver will not affect Placees` commitments as set out in this Appendix. Neither UBS Limited nor any of its respective Affiliates nor the Company shall have any liability to any Placee (or to any other person whether acting on behalf of a Placee or otherwise) in respect of any decision any of them may make as to whether or not to waive or to extend the time and/or date for the satisfaction of any condition to the Placing nor for any decision any of them may make as to the satisfaction of any condition or in respect of the Placing generally. 5. Termination of the Placing Agreement The rights of the Bookrunner to terminate the Placing are set out below: The Bookrunner may, at its absolute discretion, by notice in writing to the Company, terminate the Placing Agreement at any time prior to Admission if, inter alia: a. any of the warranties, undertakings or covenants given by the Company in the Placing Agreement is, or if repeated at any time up to and including Placing Admission (by reference to the facts and circumstances then existing) would be, untrue, inaccurate or misleading; or b. the Bookrunner becomes aware that any statement in this Appendix is or becomes untrue, inaccurate or misleading in any respect or any matter has arisen, which would, if the Placing were made at that time, constitute an omission from this Appendix (or any amendment or supplement), and which the Bookrunner in its absolute discretion acting in good faith considers to be material in the context of the Placing or Placing Admission; or c. in the opinion of the Bookrunner acting in good faith there has been a material adverse change, or any development reasonably expected to amount to a material adverse change in, the condition (financial, operational, legal or otherwise) or in the earnings management, business affairs, business prospects or financial prospects of the Group, whether or not arising in the ordinary course of business since the date of the Placing Agreement; or d. there has occurred any material adverse change in national or international financial, political or economic conditions or currency exchange rates or exchange controls that has, in the opinion of the Bookrunner, acting in good faith, resulted in the marketing of the Placing Shares or the enforcement of contracts for the subscription or sale of the Placing Shares becoming impracticable or inadvisable; or e. the application for Placing Admission is withdrawn or refused by the FSA and/or the London Stock Exchange. If the Placing Agreement is terminated in accordance with its terms, the rights and obligations of each Placee in respect of the Placing as described in this Appendix shall cease and terminate at such time and no claim can be made by any Placee in respect thereof. By participating in the Placing, each Placee agrees with the Company and the Bookrunner that the exercise by the Company or the Bookrunner of any right of termination or any other right or other discretion under the Placing Agreement shall be within the absolute discretion of the Company or the Bookrunner (as the case may be) and that neither the Company nor the Bookrunner need make any reference to such Placee and that neither the Company, UBS Limited nor any of their respective affiliates shall have any liability to such Placee (or to any other person whether acting on behalf of a Placee or otherwise) whatsoever in connection with any such exercise. By participating in the Placing, each Placee agrees that its rights and obligations terminate only in the circumstances described above and will not be capable of rescission or termination by it after oral confirmation by the Bookrunner following the close of the Bookbuilding Process. 6. Registration and settlement The basis of registration and settlement in connection with the Placing are set out below. UK Placees If UK Placees are allocated any Placing Shares in the Placing they will be sent a contract note or electronic confirmation which will confirm the number of Placing Shares allocated to them, the Sterling Placing Price and the aggregate amount owed by them to the Bookrunner. Each UK Placee will be deemed to agree that it will do all things necessary to ensure that delivery and payment is completed in accordance with either the standing CREST or certificated settlement instructions which they have in place with the Bookrunner. Payment in full for any Placing Shares so allocated at the Sterling Placing Price must be made by no later than midday (or such other time as shall be notified to each UK Placee by the Bookrunner on 10 May 2011 (or such other time and/or date as the Company and the Bookrunner may agree)). Settlement of transactions in the Placing Shares following Placing Admission will take place within the CREST system. Settlement through CREST will be on a T + three Business Day basis unless otherwise notified by the Bookrunner and is expected to occur on 10 May 2011. Settlement will be on a delivery versus payment basis. However, in the event of any difficulties or delays in the admission of the Placing Shares to CREST or the use of CREST in relation to the Placing, the Company and the Bookrunner may agree that the Placing Shares should be issued in certificated form. The Bookrunner reserves the right to require settlement for the Placing Shares, and to deliver the Placing Shares to Placees, by such other means as they deem necessary if delivery or settlement to UK Placees is not practicable within the CREST system or would not be consistent with regulatory requirements in the relevant UK Placee`s jurisdiction. Interest is chargeable daily on payments not received on the due date in accordance with the arrangements set out above, in respect of either CREST or certificated deliveries, at the rate of two percentage points above prevailing LIBOR. If UK Placees do not comply with their obligations, the Bookrunner may sell their Placing Shares on their behalf and retain from the proceeds, for their own account and benefit, an amount equal to the Placing Price of each share sold plus any interest due. UK Placees will, however, remain liable for any shortfall below the Placing Price and for any stamp duty or stamp duty reserve tax (together with any interest or penalties) which may arise upon the sale of their Placing Shares on their behalf. If Placing Shares are to be delivered to a custodian or settlement agent, UK Placees must ensure that, upon receipt, the conditional contract note or electronic confirmation is copied and delivered immediately to the relevant person within that organisation. SA Placees If SA Placees are allocated any Placing Shares in the Placing they will be sent an electronic confirmation which will confirm the number of Placing Shares allocated to them, the Rand Placing Price and the aggregate amount owed by them to the Bookrunner. Each SA Placee will be deemed to agree that it will do all things necessary to ensure that delivery and payment is completed in accordance with the requirements of STRATE, including ensuring that their CSDP accounts are credited with sufficient funds to settle the aggregate amounts owed by them, and instructing their CSDPs to book off-market trades (on a receipt versus payment basis) in respect of the Placing Shares allocated to them. Payment in full for any Placing Shares so allocated at the Rand Placing Price must be made by no later than midday (South African time) (or such other time as shall be notified to each SA Placee by the Bookrunner on 10 May 2011 (or such other time and/or date as the Company and the Bookrunner may agree)). Settlement of transactions in the Placing Shares will take place within the STRATE system. Settlement through STRATE will be on a T + three Business Day basis unless otherwise notified by the Bookrunner and is expected to occur on 10 May 2011. In the event that the company`s application to have the Placing Shares admitted to trading on the main board of the JSE is delayed beyond 9.00 a.m. on 10 May 2011, settlement shall occur up to 3 days later, or at such later time and/or date as the Company may agree with UBS, failing which the Company and the Bookrunner may agree that the Rand Placing Shares shall be issued in certificated form. Settlement will be on a delivery versus payment basis. However, in the event of any difficulties or delays in the admission of the Placing Shares to STRATE or the use of STRATE in relation to the Placing, the Company and the Bookrunner may agree that the Placing Shares should be issued in certificated form. The Bookrunner reserves the right to require settlement for the Placing Shares, and to deliver the Placing Shares to SA Placees, by such other means as they deem necessary if delivery or settlement to SA Placees is not practicable within the STRATE system or would not be consistent with regulatory requirements in a SA Placee`s jurisdiction. Interest is chargeable daily on payments not received on the due date in accordance with the arrangements set out above, in respect of either STRATE or certificated deliveries, at the rate of seven per cent. per annum. If SA Placees do not comply with their obligations, the Bookrunner may sell their Placing Shares on their behalf and retain from the proceeds, for their own account and benefit, an amount equal to the Placing Price of each share sold plus any interest due. SA Placees will, however, remain liable for any shortfall below the Placing Price plus any interest due and for any securities transfer tax (together with any interest or penalties in respect thereof) which may arise upon the sale of their Placing Shares on their behalf. If Placing Shares are to be delivered to a custodian or settlement agent, SA Placees must ensure that, upon receipt, the electronic confirmation is copied and delivered immediately to the relevant person within that organisation. 7. Representations and warranties The representations and warranties given by each of the Placees in the Placing are set out below: By participating in the Placing each Placee (and any person acting on such Placee`s behalf) will be deemed to have acknowledged, undertaken, represented, warranted and agreed (as the case may be) as follows: a. it has read the Placing Announcement and this Appendix in its entirety and that its subscription for the Placing Shares is subject to and based upon all the terms, conditions, warranties, acknowledgements, agreements and undertakings and other information contained therein and herein; b. it has not received a prospectus or other offering document in connection with the Placing and acknowledges that no prospectus or other offering document has been prepared in connection with the Placing; c. if the Placing Shares were offered to it in the United States, it represents and warrants that in making its investment decision, (i) it has consulted its own independent advisers or otherwise has satisfied itself concerning, without limitation, the effects of United States federal, state and local income tax laws and foreign tax laws generally and the US Employee Retirement Income Security Act of 1974 ("ERISA"), the US Investment Company Act of 1940 and the US Securities Act, (ii) it has received all information that it believes is necessary or appropriate in order to make an investment decision in respect of the Company and the Placing Shares and (iii) it is aware and understands that an investment in the Placing Shares involves a considerable degree of risk and no US federal or state or non-US agency has made any finding or determination as to the fairness for investment or any recommendation or endorsement of the Placing Shares; d. (i) it has made its own assessment of the Company, the Placing Shares and the terms of the Placing based on the information contained within the Placing Announcement, the Placing Results Announcement, this Appendix and any other information publicly announced to a Regulatory Information Service by or on behalf of the Company prior to the date of this Appendix (the "Publicly Available Information") and it has not relied, and will not rely, on any other information, representation, warranty or statement made at any time by any person in connection with the Placing or the Company, (ii) neither UBS Limited nor the Company nor their respective Affiliates nor any other person has made any representation to it, express or implied, with respect to the Company, the Placing or the Placing Shares or the accuracy, completeness, fairness or adequacy of the Publicly Available Information or any other written or oral information made available to any Placee, any person acting on such Placee`s behalf or any of their respective advisers, and any liability is therefore expressly disclaimed and (iii) it has made its own investigation of the business, financial and other position of the Company and the terms of the Placing, satisfied itself that the information is still current and relied on that investigation for the purposes of its decision to participate in the Placing; e. the content the Placing Announcement and of this Appendix have been prepared by and are exclusively the responsibility of the Company and neither UBS Limited nor any of its Affiliates, directors, officers, employees or any person acting on their behalf is responsible for or has or shall have any liability for any information or representation relating to the Company contained in this Appendix or the Publicly Available Information nor will be liable for any Placee`s decision to participate in the Placing based on any information, representation, warranty or statement contained in this Appendix, the Publicly Available Information or otherwise. Nothing in this Appendix shall exclude any liability of any person for fraudulent misrepresentation; f. it has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of an investment in the Placing Shares, is able to bear the economic risk of an investment in the Placing Shares, has adequate means of providing for its current and contingent needs, is able to sustain a complete loss of the investment in the Placing Shares and has no need for liquidity with respect to its investment in the Placing Shares; g. it is not and it will not be subscribing on behalf of a resident of any Excluded Territory at the time the Placing Shares are acquired; h. each of it and the beneficial owner of the Placing Shares is, and at the time the Placing Shares are acquired will be, (i) located outside the United States and acquiring the Placing Shares in an `offshore transaction`, as defined in, and in accordance with Rule 903 or Rule 904 of Regulation S under the US Securities Act, and is not purchasing the Placing Shares for the account of another person who is resident or located in the United States unless (a) the instruction to purchase was received from a person outside the United States and (b) the person giving such instruction has advised that it has the authority to give such instruction and that either it (x) has investment discretion or authority over such account or (y) otherwise is purchasing the Placing Shares in an `offshore transaction` within the meaning of Regulation S under the US Securities Act or (ii) a QIB; i. if it is acquiring the Placing Shares as a fiduciary or agent for one or more investor accounts, each such account is a QIB, it has sole investment discretion with respect to each such account and it has full power and authority to make the acknowledgements, representations, warranties and agreements herein on behalf of each such account; j. it is acquiring such Placing Shares for its own account (or the account of a QIB as to which it has sole investment discretion) for investment purposes and (subject to the disposition of its property being at all times within its control) not with a view to any distribution of the Placing Shares; k. the Placing Shares are being offered and sold to it in accordance with the exemption from registration under the Securities Act for transactions by an issuer not involving a public offering of securities in the United States and that the Placing shares have not been, and will not be, registered under the Securities Act or with any State or other jurisdiction of the United States; l. it and/or each person on whose behalf it is participating: i. is entitled to acquire Placing Shares pursuant to the Placing under the laws of all relevant jurisdictions; ii. has fully observed such laws; iii. has capacity and authority and is entitled to enter into and perform its obligations as an acquirer of Placing Shares and will honour such obligations; and iv. has obtained all necessary consents and authorities (including, without limitation, in the case of a person acting on behalf of a Placee, all necessary consents and authorities to agree to the terms set out or referred to in this Appendix under those laws or otherwise and complied with all necessary formalities; m. the Placing Shares may not be reoffered, resold, pledged or otherwise transferred by it except (a) outside the United States in an offshore transaction pursuant to Rule 903 or Rule 904 of Regulation S under the Securities Act (``Regulation S``) (and, if in a privately negotiated transaction, to a person that is not an ERISA Entity, as defined below), (b) in the United States to a person whom the seller reasonably believes is a QIB (that is not an ERISA Entity) to whom notice is given that the offer, sale or transfer is being made in reliance on Rule 144A, pursuant to Rule 144A under the Securities Act, (c) pursuant to Rule 144 under the Securities Act (if available), (d) to the Company, (e) pursuant to an effective registration statement under the Securities Act, or (f) pursuant to another available exemption, if any, from registration under the Securities Act, in each case in compliance with all applicable laws; n. the Placing Shares offered and sold in the United States are "restricted securities" within the meaning of Rule 144(a)(3) under the US Securities Act; o. so long as the Placing Shares are "restricted securities" within the meaning of Rule 144(a)(3) under the US Securities Act, it will segregate such Placing Shares from any other shares in the Company that it holds that are not restricted securities and will not deposit the Placing Shares into any depositary receipt facility maintained by any depositary bank in respect of the Company`s Ordinary Shares; p. a purchase of Placing Shares by an employee benefit plan subject to ERISA or a plan subject to Section 4975 of the US Internal Revenue Code of 1986, as amended (the "Code"), or by any entity whose assets are treated as assets of any such plan, could result in severe penalties or other liabilities for the Company; and it represents, warrants and agrees that it is not (a) (i) an employee benefit plan as described in Section 3(3) of ERISA and subject to ERISA, (ii) a plan subject to Section 4975 of the Code, (iii) any entities whose assets are treated as assets of any such plan by reason of such employee benefit plan`s or plan`s investment in the entity, or (iv) a "benefit plan investor" as such term is otherwise defined in the regulations promulgated by the US Department of Labor, and (b) if it is a governmental plan, church or other plan which is subject to any federal, state or local law that is substantially similar to the provisions of Title I of ERISA or Section 4975 of the Code, its purchase, holding or disposition of Placing Shares will not constitute or result in a non-exempt violation under any such substantially similar law (the entities referred to in (a)-(b), being referred to as "ERISA Entities"); q. it is not acquiring any of the Placing Shares as a result of any form of general solicitation or general advertising (within the meaning of Rule 502(c) of Regulation D under the US Securities Act) or is located outside the United States and it is not acquiring any of the Placing Shares as a result of any form of directed selling efforts (as defined in Regulation S under the US Securities Act); r. it acknowledges that there is a significant risk that the Company is treated as a Passive Foreign Investment Company for US federal income tax purposes, which status will subject US holders to adverse US federal income tax consequences; s. it acknowledges that where it is acquiring the Placing Shares for one or more managed accounts, it represents and warrants that it is authorised in writing by each managed account to acquire the Placing Shares for each managed account; t. if it is a pension fund or investment company, its acquisition of Placing Shares is in full compliance with applicable laws and regulations; u. no representation has been made as to the availability of the exemption provided by Rule 144, Rule 144A or any other exemption under the US Securities Act for the reoffer, resale, pledge or transfer of the Placing Shares; v. participation in the Placing is on the basis that it is not and will not be a client of UBS Limited and UBS Limited will have no duties or responsibilities to a Placee for providing protections afforded to its clients under the rules of the FSA or for providing advice in relation to the Placing nor in respect of any representations, warranties, undertakings or indemnities contained in the Placing Agreement; w. it will make payment to the Bookrunner in accordance with the terms and conditions of this Appendix on the due times and dates set out in this Appendix, failing which the relevant Placing Shares may be placed with others on such terms as the Bookrunner determines; x. the person who it specifies for registration as holder of the Placing Shares will be (i) the Placee or (ii) a nominee of the Placee, as the case may be. UBS Limited and the Company will not be responsible for any liability to stamp duty or stamp duty reserve tax resulting from a failure to observe this requirement. If it is a UK Placee, it agrees to acquire Placing Shares pursuant to the Placing on the basis that the Placing Shares will be allotted to a CREST stock account of UBS Limited who will hold them as nominee on behalf of the Placee until settlement in accordance with its standing settlement instructions with it. If it is a SA Placee, it agrees to acquire Placing Shares pursuant to the Placing on the basis that the Placing Shares will be held in the Company`s CSDP account with Absa Bank Limited until settlement in accordance with this Appendix; y. the allocation, allotment, issue and delivery to it, or the person specified by it for registration as holder, of Placing Shares will not give rise to a stamp duty or stamp duty reserve tax liability under (or at a rate determined under) any of sections 67, 70, 93 and 96 of the Finance Act 1986 (depository receipts and clearance services) or to any securities transfer tax in terms of the South African Securities Transfer Tax, 2007 and that it is not participating in the Placing as nominee or agent for any person or persons to whom the allocation, allotment, issue or delivery of Placing Shares would give rise to such a liability; z. it and any person acting on its behalf falls within Article 19(5) and/or 49(2) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended, and undertakes that it will acquire, hold, manage and (if applicable) dispose of any Placing Shares that are allocated to it for the purposes of its business only and represents and warrants that it is entitled to subscribe for Placing Shares comprised in its allocation under the laws of all relevant jurisdictions which apply to it and that it has fully observed such laws and obtained all governmental and other consents which may be required thereunder and complied with all necessary formalities; aa. it has not offered or sold and will not offer or sell any Placing Shares to persons in the United Kingdom prior to Placing Admission except to persons whose ordinary activities involve them in acquiring, holding, managing or disposing of investments (as principal or agent) for the purposes of their business or otherwise in circumstances which have not resulted and which will not result in an offer to the public in the United Kingdom within the meaning of section 85(1) of the Financial Services and Markets Act 2000 (the "FSMA"); bb. if it is within the European Economic Area, it is a qualified investor as defined in section 86(7) of FSMA, being a person falling within Article 2.1(e)(i), (ii) or (iii) of the Prospectus Directive (as defined below); cc. it has only communicated or caused to be communicated and it will only communicate or cause to be communicated any invitation or inducement to engage in investment activity (within the meaning of section 21 of the FSMA) relating to Placing Shares in circumstances in which section 21(1) of the FSMA does not require approval of the communication by an authorised person; dd. it has complied and it will comply with all applicable provisions of the FSMA with respect to anything done by it or on its behalf in relation to the Placing Shares in, from or otherwise involving the United Kingdom; ee. if it has received any confidential price sensitive information about the Company in advance of the Placing, it has not (i) dealt in the securities of the Company; (ii) encouraged or required another person to deal in the securities of the Company; or (iii) disclosed such information to any person, prior to the information being made generally available; ff. it has not offered or sold and will not offer or sell any Placing Shares to persons in the European Economic Area prior to Placing Admission except to persons whose ordinary activities involve them acquiring, holding, managing or disposing of investments (as principal or agent) for the purpose of their business or otherwise in circumstances which have not resulted and which will not result in an offer to the public in any member state of the European Economic Area within the meaning of the Prospectus Directive (which means Directive 2003/71/EC and includes any relevant implementing measure in any member state); gg. it has complied with its obligations in connection with money laundering and terrorist financing under the Proceeds of Crime Act 2002, the Terrorism Act 2000, and the Money Laundering Regulations (2003) (the "Regulations") and, if making payment on behalf of a third party, that satisfactory evidence has been obtained and recorded by it to verify the identity of the third party as required by the Regulations; hh. if it is a SA Placee, or the Placing Shares were offered to it in, or it bid for Placing Shares from, South Africa, it is acting as a principal in respect of the Placing for a minimum acquisition cost of R1 000 000; ii. if it is a SA Placee, or is a South African resident for purposes of the South African Exchange Control Regulations,, it has obtained the necessary approvals from the South African Reserve Bank in order to participate in the Placing or is entitled to make use of an exemption to the South African Exchange Control Regulations and accordingly is permitted to participate in the Placing; kk. the Company, UBS Limited and others will rely upon the truth and accuracy of the foregoing representations, warranties, acknowledgements and agreements; ll. their acceptance of any of the Placing Shares is not by way of acceptance of a public offer to be made in the Prospectus but is by way of a collateral contract and as such section 87Q of the FSMA does not entitle Placees to withdraw in the event that the Company publishes a supplementary prospectus in connection with the Placing and Admission; mm. the Placing Shares will be issued subject to the terms and conditions of this Appendix; nn. this Appendix will be governed by and construed in accordance with English law. All agreements to acquire shares pursuant to the Bookbuilding Process and/or the Placing will be governed by English law and the English courts shall have exclusive jurisdiction in relation thereto except that proceedings may be taken by the Company, UBS Limited in any jurisdiction in which the relevant Placee is incorporated or in which any of its securities have a quotation on a recognised stock exchange; and it (and any person acting on its behalf) agrees to indemnify and hold the Company, UBS Limited and their respective Affiliates, directors, officers and employees harmless from any and all costs, claims, liabilities and expenses (including legal fees and expenses) (i) arising out of or in connection with any breach of the representations, warranties, acknowledgements, agreements and undertakings in this Appendix; or (ii) incurred by UBS Limited, the Company and/or any of their respective Affiliates, directors, officers and employees arising from the performance of the Placee`s obligations or any breach of the representations, warranties, acknowledgements, agreements and undertakings, in each case as set out in this Appendix, and further agrees that the provisions of this Appendix shall survive after completion of the Placing. In addition, Placees should note that they will be liable for any capital duty, stamp duty and all other stamp, issue, securities transfer, registration, documentary or other duties or taxes (including any interest, fines or penalties relating thereto) payable outside the United Kingdom by them or any other person on the acquisition by them of any Placing Shares or the agreement by them to subscribe for any Placing Shares. The representations, warranties, acknowledgements and undertakings contained in this Appendix are given to UBS Limited for itself and on behalf of the Company and are irrevocable. UBS Limited are acting exclusively for the Company and no one else in connection with the Bookbuilding Process and the Placing and UBS Limited will not be responsible to anyone (including Placees) other than the Company for providing the protections afforded to their respective clients or for providing advice in relation to the Bookbuilding Process or the Placing or any other matters referred to in this Appendix. Each Placee and any person acting on behalf of the Placee acknowledges that UBS Limited does not owe any fiduciary or other duties to any Placee in respect of any representations, warranties, undertakings or indemnities in the Placing Agreement or otherwise. Each Placee and any person acting on behalf of each Placee acknowledges and agrees that UBS Limited or any of its affiliates may, at their absolute discretion, agree to become a Placee in respect of some or all of the Placing Shares. When a Placee or person acting on behalf of the Placee is dealing with UBS Limited, any money held in an account with UBS Limited on behalf of the Placee and/or any person acting on behalf of the Placee will not be treated as client money within the meaning of the rules and regulations of the FSA made under FSMA. The Placee acknowledges that the money will not be subject to the protections conferred by the client money rules; as a consequence, this money will not be segregated from UBS Limited`s money in accordance with the client money rules and will be used by UBS Limited in the course of its own business; and the Placee will rank only as a general creditor of UBS Limited. All times and dates in this Appendix may be subject to amendment. UBS Limited shall notify the Placees and any person acting on behalf of the Placees of any changes. Past performance is no guide to future performance and persons needing advice should consult an independent financial adviser. 8. Passive Foreign Investment Company There is a significant risk that the Company may be considered to be a Passive Foreign Investment Company for US federal income tax purposes. US shareholders should consult their tax advisers regarding the potential application of the PFIC regime. In this Appendix the following expressions have the following meaning unless the context otherwise requires: Admission Placing Admission and/or SA Admission, as the context requires.
Affiliate any holding company, subsidiary, branch or associated undertaking (including, without limitation, joint venture partners) from time
to time or any subsidiary, branch or associated undertaking (including, without limitation, joint venture partners) of any such
holding company from time to time. Articles of Association the articles of association of the Company from time to time in force. Bookbuilding Process the bookbuilding process carried out by UBS Limited to establish demand at different prices from potential placees for the Placing Shares.
Bookrunner UBS Limited. Business Day a day (excluding Saturdays and Sundays) on which banks are generally open for normal banking
business in the City of London and South Africa. Company or Capco Capital & Counties Properties PLC, a company incorporated under the
laws of England and Wales (registered under no. 07145051), with its registered office at 15 Grosvenor Street, London W1K 4QZ
and registered as an external company in South Africa (registered under no. 2010/003387/10), with its registered external office at
Liberty Life Centre, 1 Ameshoff Street, Johannesburg, 2001. CREST the relevant system (as defined in the CREST Regulations) in respect
of which Euroclear is the Operator (as defined in the CREST Regulations). CSDP a Central Securities Depositary Participant accepted as such in terms of the Securities Services Act. European Economic Area the European Union, Iceland, Norway or EEA and Liechtenstein. Excluded Territories Australia, Canada or Japan. Financial Services and the United Kingdom Financial Markets Act 2000 or Services and Markets Act 2000, as FSMA amended. FSA the UK Financial Services Authority acting in its capacity as competent authority for the purposes of Part
VI of FSMA and in the exercise of its functions in respect of the admission to the premium listing segment of the Official List of the
Financial Services Authority otherwise than in accordance with Part VI of FSMA, including, where the context so permits, any
committee, employee, officer or servant to whom any function of the Financial Services Authority may for the time being be delegated.
Group the Company and its subsidiary undertakings, affiliates and associates from time to time. JSE JSE Limited, a public company incorporated and registered in South Africa (Registration number 2005/022939/06), licensed as a securities exchange in terms of the
Securities Service Act, No 36 of 2004, as amended. JSE List the list of securities admitted to listing maintained by the JSE.
LIBOR London Interbank Offer Rate. Listing Rules the listing rules produced by the FSA under Part VI of FSMA and forming part of the FSA`s Handbook
of rules and guidance as from time to time amended. London Stock Exchange London Stock Exchange plc. or LSE Official List the list maintained by the FSA in accordance with section 74(1) of FSMA for purposes of Part VI of FSMA.
Ordinary Shares or the ordinary shares of 25 pence Shares each in the capital of the Company. Passive Foreign a passive foreign investment Investment Company or company within the meaning of PFIC Section 1297 of the United States Internal Revenue Code of 1986. Placees the SA Placees and/or the UK Placees, as the context requires.
Placing the placing of Placing Shares by UBS Limited on behalf of the Company pursuant to the provisions of the Placing Agreement and as
described in this Appendix. Placing Admission admission to listing on the premium listing segment of the Official List and admission to trading on
the London Stock Exchange of the Placing Shares becoming effective by the decision of the UK Listing Authority to admit such shares to
listing being announced in accordance with the Listing Rules and by the decision of the London Stock Exchange`s Main Market for
Listed Securities to admit such shares to trading being announced in accordance with the Admission and Disclosure Standards.
Placing Agreement the placing agreement entered into between the Company and UBS Limited on 4 May 2011. Placing Press the press announcement containing Announcement these terms and conditions of the Placing. Placing Price the Rand Placing Price and/or the Sterling Placing Price, as the
context requires. Placing Shares the Sterling Placing Shares and/or the Rand Placing Shares, as the context requires.
Pounds sterling, the lawful currency of the UK. Sterling or GBP Placing Results the announcement relating to the Announcement Placing Price in the form to be agreed. Pricing Supplement the pricing supplement to the Placing Agreement. QIB qualified institutional buyer, within the meaning of Rule 144A under the US Securities Act. Rand or R the lawful currency of South Africa.
Rand Placing Price the price per Rand Placing Share to be set out in the Pricing Supplement. Rand Placing Shares up to 18,630,000 new ordinary shares of 25 pence each in the capital of the Company to be issued to Shareholders in South Africa at the Rand Placing Price
Regulatory Information in respect of the UK Placees, any Service of the services set out in Appendix 3 to the Listing Rules. SA Admission admission of the Placing Shares to the JSE List and to the JSE`s Main Board for Listed Securities becoming effective in accordance with the JSE Listings Requirements.
SA Placees those persons whose Placing Shares will be recorded on the SA Register. SA Register the branch register of the members of the Company in South Africa. Securities Services Act the South African Securities Services Act, No 36 of 2004, as amended.
Shareholders holders of Ordinary Shares. South Africa the Republic of South Africa. South African Exchange the restrictions applicable to Control residents and non-residents as to the remittance of funds from South Africa to a foreign country. South African Exchange the Exchange Control Regulations of Control Regulations South Africa issued under the Currency and Exchanges Act, No 9 of 1933. Sterling Placing Price the price per Sterling Placing Share to be set out in the Pricing
Supplement. Sterling Placing Shares up to 62,100,000 new ordinary shares of 25 pence each in the capital of the Company to be issued
to Shareholders outside South Africa at the Sterling Placing Price. STRATE STRATE Limited, registration number 1998/022242/06, a public company incorporated with limited liability under the laws of South Africa, which is licensed as a central
securities depositary under the Securities Services Act. UBS Limited UBS Limited, a company registered in England and Wales with number
02035362 whose registered office is at 1 Finsbury Avenue, London EC2M 2PP. UK the United Kingdom of Great Britain and Northern Ireland. UK Listing Authority or the FSA in its capacity as the UKLA competent authority for the purposes of Part VI of FSMA.
UK Placees those persons whose Placing Shares will be recorded on the UK Register. UK Register the register of members of the Company in the UK, excluding, for the avoidance of doubt, the SA Register. US or United States the United States of America, its territories and possessions, any State of the United States and the District of Columbia. US Holder is a beneficial owner of Ordinary Shares that is (i) a citizen or resident of the United States for US federal income tax purposes; (ii) a corporation, or other entity
treated as a corporation, created or organised under the laws of the United States or any state thereof; (iii) an estate the income of which
is subject to US federal income tax without regard to its source; or (iv) a trust if a court within the United States is able to exercise
primary supervision over the administration of the trust and one or more US persons have the authority to control all
substantial decisions of the trust. US Securities Act or the US Securities Act of 1933, as Securities Act amended. US Securities and the US government agency having Exchange Commission primary responsibility for enforcing the federal securities laws and regulating the securities industry/stock market.
Sponsor: UBS South Africa (Pty) Ltd Date: 05/05/2011 08:01:07 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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