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RAR - Rare Holdings Limited - Declaration announcement in respect of a
proposed claw-back offer and the conclusion of an underwriting and
subscription agreement
RARE HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
Registration Number: 2002/025247/06
Share Code: RAR ISIN: ZAE000092714
("the Company" or "RARE")
DECLARATION ANNOUNCEMENT IN RESPECT OF A PROPOSED CLAW-BACK OFFER AND THE
CONCLUSION OF AN UNDERWRITING AND SUBSCRIPTION AGREEMENT
1. INTRODUCTION
1.1 Shareholders are referred to the announcement on SENS dated 30
September 2011 in terms of which shareholders were advised that the
Company will be pursuing an additional permanent capital injection.
1.2 The Board would like to announce to shareholders that the Company
entered into an underwriting and subscription agreement with Stafric
Investment and Management Services Proprietary Limited ("Stafric"),
the salient details of which are set out hereunder in paragraph 7
("the U&S Agreement").
1.3 Accordingly, shareholders are advised that the Company will be
proposing a claw-back offer of 250 000 000 new ordinary shares
("claw-back shares") to RARE shareholders recorded in the register
at the close of business on the initial record date (as detailed in
paragraph 2 below) at a subscription price of 12 cents per claw-back
share, in the ratio of 86.58009 claw-back shares for every 100 RARE
shares held ("the claw-back offer").
1.4 The aforementioned subscription price represents a discount of
approximately 11.4% to the 30 day volume weighted average share
price of RARE as at 30 November 2011.
1.5 The implementation of the claw-back offer is conditional upon the:
1.5.1 registration of the requisite special resolutions with the
Companies and Intellectual Property Commission which
special resolutions have been passed at the Company`s
Annual General Meeting as announced on SENS on 14 December
2011; and
1.5.2 approval thereof by the JSE Limited ("the JSE").
1.6 The claw-back offer will not include the right for shareholders to
apply for excess shares.
2. SALIENT DATES AND TIMES
The salient dates and times of the claw-back offer are as follows:
2011/2012
Finalisation announcement released on SENS Friday, 23 December
Listing of claw-back offer shares and issue to Wednesday, 28 December
underwriter
Last day to trade in RARE shares in order to Friday, 6 January
qualify to participate
in the claw-back offer (cum entitlement) on
Listing of letters of allocation on the JSE under Monday, 9 January
the JSE code RARN
and ISIN ZAE000156964 at commencement of trading
on
RARE shares commence trading ex-claw-back rights Monday, 9 January
on the JSE at
commencement of trading on
Record date for participation in the claw-back Friday, 13 January
offer at the close of trade on
Claw-back offer circular and form of instruction Monday, 16 January
posted to shareholders, where applicable
Claw-back offer opens at commencement of trading Monday, 16 January
on
Dematerialised shareholders` accounts at their Monday, 16 January
CSDP or broker automatically credited with their
entitlement
Certificated shareholders` entitlements will be Monday, 16 January
credited to an account held with the transfer
secretaries
Last day to trade in letters of allocation on the Friday, 27 January
JSE on
Trade in claw-back offer shares commences Monday, 30 January
Claw-back offer closes - payments to be made and Friday, 3 February
form of instruction in respect of letters of
allocation lodged by certificated shareholders by
12:00 (see note 5) on
Friday, 3 February
Record date for letters of allocation
Dematerialised shareholders` accounts updated Monday, 6 February
with claw-back shares to the
extent accepted and debited with the relevant
costs by their CSDP or broker
and new RARE share certificates posted to
certificated shareholders (see note 5) on
Results of claw-back offer announcement released
on SENS on or about Monday, 6 February
Notes:
1. Dematerialised shareholders are required to notify their duly
appointed CSDP or broker of their acceptance or otherwise of the
claw-back offer in the manner and time stipulated in the agreement
governing the relationship between such shareholder and their CSDP
or broker.
2. All times indicated are South African times unless otherwise stated.
3. Share certificates may not be dematerialised or rematerialised
between Monday, 9 January 2012 and Friday, 13 January 2012, both
days inclusive.
4. The CSDP /broker accounts of dematerialised shareholders will be
automatically credited with new RARE shares to the extent to which
they have accepted the claw-back offer. RARE share certificates
will be posted, by registered post at the shareholders` risk, to
certificated shareholders in respect of the claw-back offer shares
which have been accepted.
5. CSDPs or brokers effect payment in respect of dematerialised
shareholders on a delivery versus payment method.
3. PRO FORMA FINANCIAL EFFECTS OF THE CLAW-BACK OFFER
3.1 The pro forma financial effects of the claw-back offer on RARE are
based on the audited results for the year ended 30 June 2011, the
preparation of which is the responsibility of the directors.
3.2 The pro forma financial information should be read in conjunction with
the independent reporting accountant`s report thereon as set out in
Annexure 8 to the circular (as defined in paragraph 4 below).
3.3 The unaudited pro forma financial information has been prepared for
illustrative purposes only to provide information as to how the RARE claw-
back offer might have impacted on the financial position and results of
RARE assuming that the claw-back offer had been implemented on 30 June
2011 for purposes of the statement of financial position and on 1 July
2010 for purposes of the statement of comprehensive income.
3.4 The unaudited pro forma financial information has been presented for
illustrative purposes only and, because of its nature, may not give a
fair reflection of RARE`s financial position and results after the RARE
claw-back offer.
Year ended After %
30 June Pro forma Change
2011 30 June
2011
Loss per ordinary share (87.83) (25.43) 71.04%
(cents)
Diluted loss per ordinary (87.83) (25.43) 71.04%
share (cents)
Headline loss per share (36.19) (10.25) 71.68%
from continuing
operations (cents)
Headline loss per share (23.52) (6.92) 70.60%
from discontinued
operations (cents)
Net asset value per share 22.70 17.74 -21.87%
(cents)
Net tangible asset value 20.43 16.52 -19.15%
per share (cents)
Number of ordinary shares 288 750 000 538 750 000 86.58%
in issue
Weighted average number 104 091 306 354 091 306 240.17%
of ordinary shares in
issue
Notes
1. Extracted from the audited consolidated results of RARE Holdings for
the year ended 30 June 2011.
2. Basic earnings per share and diluted earnings per share are based on
the following assumptions:
- The interest rate used was the prime overdraft lending rate per
annum and was based on the average lending rate on debt
facilities as at year end.
- A tax rate of 28% was applied.
- The interest charged was reduced by the cash raised at prime
lending rates.
3. Weighted average number of shares, being 354 091 306 shares, was
computed as if the issue was effected on 1 July 2010.
4. Transaction costs have been taken into account in the calculation of
the financial effects.
5. The total transaction cost is R725 300 on the assumption that the
proceeds of R30 million was received.
6. For the purpose of calculating the net tangible asset value per
share, intangible assets were excluded.
7. All the pro forma effects on the income statement are expected to
have a continuing effect on the company.
8. The amount of R30 million raised under the claw-back offer was used
to settle an existing creditor trade facility which bore interest at
prime.
4. DOCUMENTATION
A circular containing full detail of the claw-back offer will be posted
to shareholders on 16 January 2012 ("the circular").
5. DISCLOSURE OF POTENTIAL DIRECTORS DEALINGS
Shareholders are advised that the Company will be entering a closed
period, as defined by the Listing Requirements of the JSE Limited,
effective 1 January 2012 by entering into their interim reporting period.
Shareholders are advised that certain of the directors and/or their
associates may or may not follow their rights under the claw-back offer.
These directors and their associates are permitted to follow their rights
under the claw-back offer, subject thereto that they do not trade in
their letters of allocation.
6. JURISDICTION
The distribution of the circular and/or accompanying documents and/or the
transfer of the new RARE shares and/or the rights to subscribe for new
RARE shares in jurisdictions other than South Africa may be restricted by
law and failure to comply with any of those restrictions may constitute a
violation of the laws of any such jurisdiction in which it is illegal to
make such a claw-back offer. In such circumstances, the circular will
not be addressed to such shareholders and the claw-back offer will be
made only to qualifying shareholders.
7. U&S AGREEMENT
7.1 In terms of the U&S Agreement, Stafric will subscribe for 250 000
000 new ordinary shares of no par value in the ordinary share
capital of RARE at a subscription price of 12 cents per share for
the total amount of R30 million.
7.2 The aforementioned subscription price represents, a discount of
approximately 11.4% to the 30 day volume weighted average share
price of RARE as at 30 November 2011.
7.3 In expediting its duties as underwriter to the claw-back offer,
Stafric will be entitled to an amount of R300 000 plus VAT (1% of
the total underwritten amount) as consideration for agreeing to
underwrite 100% of the claw-back offer.
Johannesburg
20 December 2011
Designated Advisor: PSG Capital Proprietary Limited
Date: 20/12/2011 16:45:01 Supplied by www.sharenet.co.za
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