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KIR - Kairos Industrial Holdings Limited - Business update Brokrew Industrial (Pty) Limited and cautionary announcement Kairos Industrial Holdings Limited (Incorporated in the Republic of South Africa) (Registration number 1987/002927/06) Share code: KIR ISIN: ZAE000011284 ("Kairos" or "the Group") BUSINESS UPDATE - BROKREW INDUSTRIAL (PTY) LIMITED AND CAUTIONARY ANNOUNCEMENT Liquidation of Brokrew Industrial (Pty) Limited Shareholders have been advised in prior annual reports of the Group that its subsidiary, Brokrew Industrial (Pty) Limited ("Brokrew") had been adversely affected by the cancellation of the Medupi Contract. Subsequent to this cancellation Brokrew has written off amounts of R69 million and R17 million in the 2010 and 2011 financial years respectively, for debts owed, claims against and work done for the primary contractor. The above situation rendered Brokrew in a precarious financial position and the Group sought further working capital finance from its financiers, which has also been alluded to in the annual report for the 2011 financial year. The Group has to date not been able to successfully conclude these negotiations. In July 2011, metal industry workers embarked on a nationwide strike for more than two weeks and Brokrew was forced to shut down all four of its factories, which was exacerbated by subsequent strikes at that mines that it serves. Given its already precarious financial position, this was a situation that Brokrew could ill afford. At present, Brokrew is thus unable to service any significant clients and raw material suppliers have ceased delivering to the company. Accordingly, shareholders are advised that the Brokrew board of directors has decided, based upon their assessment of the above facts, to place Brokrew into voluntary liquidation. Proposed Delisting of Kairos Shareholders are further referred to the SENS announcement dated 8 June regarding the proposed delisting of Kairos. In light of the above and the resultant uncertainty regarding the impact on, and the financial effects for the Group, the proposed delisting of Kairos will be reviewed once greater certainty is achieved regarding the impact of the above developments. Cautionary Announcement Shareholders will be advised of any material developments, as well as the financial effects thereof once more reliably determined. Shareholders are advised to exercise caution when dealing in Kairos shares until further announcements in respect of the above is made. Pretoria 19 August 2011 Sponsor: Bridge Capital Advisors (Pty) Limited Date: 19/08/2011 17:30:01 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.
