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BRT/BRN - Brimstone Investment Corporation - Announcement regarding an increase

Release Date: 21/12/2011 13:38
Code(s): BRT BRN
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BRT/BRN - Brimstone Investment Corporation - Announcement regarding an increase in Brimstone`s shareholding in Oceana Group Limited to 16.86% (20.11% net of treasury shares) Brimstone Investment Corporation Limited (Incorporated in the Republic of South Africa) Registration number 1995/010442/06 Share Code: BRT ISIN: ZAE000015277 Share Code: BRN ISIN: ZAE000015285 ("Brimstone" or the "Company") ANNOUNCEMENT REGARDING AN INCREASE IN BRIMSTONE`S SHAREHOLDING IN OCEANA GROUP LIMITED ("OCEANA") TO 16.86% (20.11% NET OF TREASURY SHARES) 1 Introduction Brimstone is pleased to advise its shareholders that the Company has acquired an additional 8,500,000 Oceana ordinary shares ("Oceana shares") at R45.00 per share (cum dividend of R1.83 per share payable to Oceana ordinary shareholders on 16 January 2012), thereby increasing its shareholding in Oceana from 9.73% to 16.86% (from 11.61% to 20.11% net of treasury shares) ("the Transaction"). The Oceana shares were acquired on market and the Transaction is effective 21 December 2011. 2 Rationale for the Transaction With the addressing of food security continuing to be a global priority, Brimstone, one of South Africa`s leading Broad-based Black Economic Empowerment ("BBBEE") investors, identified the food sector as one of its areas of strategic focus. The Transaction allows Brimstone to meaningfully increase its shareholding in Oceana, one of the larger food producers in Southern Africa, and thereby increase its exposure to the sector. The Transaction further enhances Oceana`s BBBEE ownership credentials. 3 Description of Oceana Oceana, known for its Lucky Star brand, is the largest and most diversified fishing company in South Africa and an important participant in Namibia`s fishing industry, holding long-term fishing rights for multiple species in both fisheries. Oceana is listed on the JSE Limited ("JSE") (share code: OCE). Oceana`s core business is the harvesting, sourcing, processing, marketing and distribution of canned fish, fishmeal, fish oil, lobster, horse mackerel, squid and hake both locally and internationally. It is an industry leader in canned pilchard, horse mackerel and lobster with its Lucky Star brand consistently rated one of the top brands in South Africa. Oceana`s operating facilities are located in St Helena Bay, Lambert`s Bay, Cape Town, Hout Bay, Port Elizabeth, Humansdorp and Walvis Bay. It employs 1,711 permanent and 512 seasonal employees and is one of the largest employers on the west coast of South Africa. Oceana also provides an extensive network of commercial cold storage and fruit-handling facilities in South Africa and Namibia and operates a factory producing french fries and other potato products in Lamberts Bay. Further information on Oceana can be accessed at www.oceana.co.za. 4 Consideration for the Transaction The total consideration for the Transaction is R382.5 million ("the Purchase Consideration") and will be settled in cash through Brimstone accessing its long term funding facilities. 5 Conditions precedent The Transaction is not subject to any conditions. 6 Unaudited pro forma financial effect of the Transaction ("Financial Effects") Based on Brimstone`s unaudited results for the six months ended 30 June 2011 ("Interim Results"), the Financial Effects of the Transaction on Brimstone`s headline earnings per share ("HEPS") is set out below. The Financial Effects on Brimstone`s net asset value per share, net tangible asset value per share and earnings per share for the six months ended 30 June 2011 have not been disclosed as these are not significant. The Financial Effects are prepared for illustrative purposes only, and because of its nature, may not give a fair presentation of Brimstone`s financial position or the effect and impact of the Transaction. The Financial Effects are the responsibility of Brimstone`s board of directors. The accounting policies of Brimstone have been used in calculating the Financial Effects.
Before the After the Change Transaction(1) Transaction % HEPS (cents) 81.2 78.6(3) (3.2) Weighted average number of 243 863 243 863 shares in issue (000`s) Notes: 1 Based on Brimstone`s Interim Results. 2 In calculating the Financial Effects on HEPS, it was assumed that the Transaction was implemented on 1 January 2011 for statement of comprehensive income purposes. 3 The HEPS figure was adjusted for the following: a An increase in dividends received of R3.1 million and an increase of R8.4 million in share of profits of associates and joint venture. b An increase of R16.5 million in finance costs, which are of a continuing nature. C An increased tax charge of R1.3 million. 4 Transaction costs have not been accounted for as they are not material. 7 Categorisation of the Transaction The Transaction is categorised as a Category 2 transaction in terms of the JSE Listings Requirements. 21 December 2011 Cape Town Investment Bank and Sponsor Nedbank Capital Date: 21/12/2011 13:38:01 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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