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BSR - Basil Read Holdings Limited - Acquisition of 52% interest in Central

Release Date: 07/09/2011 15:09
Code(s): BSR
Wrap Text

BSR - Basil Read Holdings Limited - Acquisition of 52% interest in Central Systems Proprietary Limited Basil Read Holdings Limited (Incorporated in the Republic of South Africa) Registration Number 1984/007758/06 Share Code: BSR ISIN: ZAE000029781 ("Basil Read" or "the Company") ACQUISITION OF 52% INTEREST IN CENTRAL SYSTEMS PROPRIETARY LIMITED 1. Introduction The board of directors of Basil Read is pleased to announce that the company, through its wholly owned subsidiary Basil Read (Pty) Ltd or any other subsidiary nominated by Basil Read (Pty) Ltd, entered into an agreement on Monday, 05 September 2011, with the Purple Trust, the GRCS Trust, Seafire Holdings (Pty) Ltd ("Seafire") and Mathew Reid Project Management (Pty) Ltd ("Mathew Reid"), collectively the "vendors", to acquire a 52% equity interest in the share capital of Central Systems (Pty) Limited ("Central Systems") for a total consideration of AUD15 million (the "consideration") (the "acquisition"). 2. Rational for the acquisition and description of the business of Central Systems Central Systems is a profitable business and is anticipated to be earnings accretive for Basil Read. The acquisition is in line with the company`s stated intention of growing by acquisition as well as organically into markets outside of South Africa. Central Systems` core services revolve around civil and remedial construction contracting services to create and extend the life of building structures, infrastructure and industrial assets. Central Systems has an enviable track record for precision and quality of workmanship. With over 100 years of combined management experience, the company is at the forefront of new technologies and applications. Next to safety and quality, client focus is central to the company`s core operating philosophy and the company takes pride in providing unique solutions to meet clients` needs. Central Systems has fulfilled key project roles in the construction of power stations, liquefied natural gas plants, chemical manufacturing facilities, iron ore processing and handling projects, road and rail bridges, and jetties and wharfs. The objectives of Central Systems are to: - provide specialist maintenance, minor works and refurbishment services to existing structures and buildings; - provide specialist civil remedial services to the industrial sector for existing structures and buildings; - provide specialist ancillary services to the construction sector for new structures and buildings; and - provide general and specialist civil and concrete construction services. 3. Effective date The effective date of the acquisition is the first day of the calendar month following the date on which all the conditions precedent, set out in paragraph 5 below, have been fulfilled ("effective date"). The effective date is expected to be on or around 1 November 2011. 4. The consideration Under the terms of the acquisition agreement the consideration will be settled as follows: - AUD10 million will be payable in cash by Basil Read to the vendors on the effective date; and - the balance of AUD5 million will be payable in cash by Basil Read to the vendors 28 days post receipt by Basil Read of the Audited Financial Statements of Central Systems for the year ended 30 June 2012, expected to be on or around 1 September 2012. The consideration will be funded through Basil Read banking facilities. 5. Conditions precedent The acquisition is subject to conditions that are considered normal for a transaction of this nature, of which the following remain outstanding: - finalisation and execution of definitive documentation to effect the acquisition, comprising: - a share sale and purchase agreement between the vendors and Basil Read; - a shareholders` agreement between Central Systems, Basil Read and the vendors; - executive service contracts between Central Systems and each of Messrs. Richard Eden, Ivan Ruefli and Gary Reid; and - the conclusion of restraint of trade agreements between Central Systems, Basil Read and each of Messrs. Richard Eden, Ivan Ruefli, Andrew Ellison, Gary Reid, as well as the Purple Trust, the GRCS Trust, Seafire and Mathew Reid, - each of the boards of directors of Basil Read, Seafire and Mathew Reid, as well as each of the trustees of the Purple Trust and the GRCS Trust, approving the transaction; - Exchange control approval being obtained from the Reserve Bank of South Africa on terms acceptable to Basil Read, including the associated transfer of any funds from South Africa to Australia, and any associated offshore borrowing of funds by Basil Read; - receipt of all necessary change of control consents in a form satisfactory to Basil Read; and - receipt of all necessary regulatory approvals, including, but not limited to formal approval being obtained from JSE Limited ("JSE"). 6. Categorisation of the acquisition The acquisition is deemed to constitute a Category 2 transaction as defined under the provisions of the Listings Requirements of the JSE. 7. Cautionary announcement Shareholders are advised to exercise caution when dealing in the company`s securities until a further announcement, containing the pro forma financial effects relating to the acquisition is released in due course. Johannesburg 7 September 2011 JSE Sponsor: Macquarie First South Capital (Pty) Limited Date: 07/09/2011 15:09:01 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.

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