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BIK - Brikor Limited - Sale of Olifantsfontein Property and cautionary

Release Date: 14/10/2011 15:49
Code(s): BIK
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BIK - Brikor Limited - Sale of Olifantsfontein Property and cautionary announcement Brikor Limited (Incorporated in the Republic of South Africa) (Registration number: 1998/013247/06) (Share Code: BIK ISIN Code: ZAE000101945) ("Brikor" or "the Company") SALE OF OLIFANTSFONTEIN PROPERTY AND CAUTIONARY ANNOUNCEMENT 1. INTRODUCTION Shareholders are informed that Brikor has entered into a Sale of Immovable Property Agreement ("sale agreement") on 11 October 2011, subject to a condition precedent, for the sale of the following immovable properties ("the transaction"): - Portion 5 and Portion 26 (Portions of portion 15) of erf 1250, Clayville Extension 14 Township; and - Erven 390, 391 and 392, Clayville Extension 3 Township on 11 March 2011. The above are collectively hereafter referred to as "Olifantsfontein" or "the property". 2. BACKGROUND INFORMATION Brikor is a manufacturer and supplier of clay bricks, roof tiles, clay pipes and pavers as well as ancillary products and a producer of coal to, in particular, the power suppliers. The company recently entered into a comprehensive restructuring programme to restore operations to profitability and to strengthen its financial position. Fundamental to the restructuring programme, was regaining focus on core operations. Certain assets and operations, such as Olifantsfontein, were identified as non-core to the main business of Brikor and thus the decision to dispose of them. 3. RATIONALE FOR THE DISPOSAL The sale of Olifantsfontein is in line with Brikor`s strategy to strengthen the group`s cash resources as well as improving its current debt burden. 4. TERMS AND CONDITIONS OF THE DISPOSAL 4.1 On 11 October 2011, Brikor entered into a sale agreement for the property to Kusasa Commodities 148 (Pty) Limited ("purchaser"). 4.2 The purchase price payable for Olifantsfontein is the aggregate of R 19 million excluding VAT. 4.3. The purchase price will be payable as follows: 4.3.1. Initial non refundable payment of R 2 million in cash to Brikor, which has been received; and 4.3.2. the balance of R 17 million which will be paid to Brikor against the registration of transfer of the property into the name of the purchaser.
5. CONDITION PRECEDENT The disposal is conditional upon the outstanding condition precedent that the purchaser obtains approval of a loan by a financial institution of not less than R 17,1 million upon the security of a first mortgage bond to be registered over the property at such rates of interest and on such conditions as are stipulated by the institution to which application for the loan is made, by not later than 30 days after date of signature. 6. UNAUDITED PRO FORMA FINANCIAL EFFECTS OF THE DISPOSAL The unaudited pro forma financial effects will be published in due course. 7. CATEGORISATION OF THE TRANSACTION The transaction is categorised, in terms of the JSE Limited`s ("JSE") Listings Requirements, as a Category 2 transaction and does not require shareholders` approval. 8. CAUTIONARY ANNOUNCEMENT Shareholders are advised to exercise caution in dealing in the company`s securities on the JSE until such time as the financial effects of the transaction are published. Shareholders will be notified once the transaction becomes unconditional. Nigel 14 October 2011 Designated Adviser Exchange Sponsors Date: 14/10/2011 15:49:01 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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