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DEC - Decillion - Detailed cautionary announcement regarding the acquisition by Decillion of all the issued shares of Lashka 132 Ltd and further cautionary announcement Decillion Limited (Registration number: 1998/011692/06) (Incorporated in the Republic of South Africa) JSE code: DEC & ISIN: ZAE000108247 ("Decillion" or "the Company") DETAILED CAUTIONARY ANNOUNCEMENT REGARDING THE ACQUISITION BY DECILLION OF ALL THE ISSUED SHARES OF LASHKA 132 LTD ("LASHKA") AND FURTHER CAUTIONARY ANNOUNCEMENT INTRODUCTION Following the cautionary announcements released on SENS on 25 May 2010, 8 July 2010, 20 August 2010, 04 October 2010, 15 November 2010, 28 December 2010, 08 February 2011, 22 March 2011, 06 May 2011 and 21 June 2011 respectively, which announcements detailed that the Company had entered into negotiations with a construction and property development company which is acquiring and consolidating a diversified property portfolio, for a possible reverse listing of a large construction company, development company and the properties being acquired into Decillion, and the cautionary announcement of 2 August 2011 in which the Company announced the signing of a Memorandum of Understanding ("MOU") with Ardor Group (Proprietary) Limited, the Company is pleased to announce that Decillion and Sciofin (Proprietary) Limited ("Sciofin") have signed a Memorandum of Understanding ("MOU") dated 15 September 2011. The MOU agrees that Decillion acquires from Sciofin all the issued shares of Lashka 132 Limited ("Lashka") for a purchase consideration of R840 783 000 of which R333 540 000 of the purchase consideration is payable in equity through the issue of new shares in Decillion at R2.45 per share and the remaining R507 243 000 payable in cash, subject to the conclusion of the conditions precedent detailed below. CONDITIONS PRECEDENT The acquisition is subject to the fulfilment of the following conditions precedent: * The maximum bank and or other liabilities to be assumed by Decillion in relation to the Portfolio will not exceed R311 420 000 at a maximum agreed rate; * The historic net income before interest and tax of the Portfolio is R109 459 000, not accounting for any projected escalation in rental income. * The transaction is subject to approval by the shareholders of Decillion on or before 15 December 2011 as well as other statutory and regulatory approvals. * The completion of due diligences by the respective parties on each other within 60 days of signature. * Sufficient cash needs to be raised by Decillion for the cash portion of the Purchase Price on or before 15 December 2011. LASHKA PROPERTY PORTFOLIO Details on the property portfolio and financial effects will be announced in due course. REVERSE TAKEOVER Shareholders are cautioned that the implementation of the proposed acquisition will result in the issue of more than 100% of the current issued share capital of the Company, and accordingly will result in a reverse takeover of Decillion for the purposes of the Listings Requirements, which stipulate that the Company can only retain its listing following the reverse takeover if the JSE is satisfied that the Company continues to qualify to be listed. The listing on the Main Board is conditional on the Company maintaining the said shareholder spread requirements. PRO FORMA FINANCIAL EFFECTS OF THE TRANSACTIONS A separate SENS announcement detailing the pro forma financial effects will be published in due course. CHANGE OF CONTROL Depending on the outcome of separate ongoing acquisition discussions, which outcomes will be detailed in a separate announcement once concluded, there may or may not be a change in control. This will be determined in due course and further announcements made where required. DOCUMENTATION AND SALIENT DATES A circular to shareholders detailing the terms of the acquisition and reverse takeover, incorporating revised listing particulars is currently being drafted and will be distributed to shareholders in due course. Salient dates shall also be announced in due course. FURTHER CAUTIONARY ANNOUNCEMENT Since the Company is still negotiating further acquisitions and the final terms and pro forma financial effects of the above-mentioned acquisition and reverse takeover have not yet been published, shareholders are advised to continue exercising caution when dealing in the Company`s securities until a full announcement is made. JOHANNESBURG 16 September 2011 SPONSOR Arcay Moela Sponsors (Proprietary) Limited Date: 16/09/2011 15:56:05 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.
