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KIR - Kairos Industrial Holdings - Acquisition by Kairos of the entire
issued ordinary share capital of Erf 128/1 Hatfield (Proprietary) Limited
Kairos Industrial Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number 1987/002927/06)
Share code: KIR ISIN: ZAE000011284
("Kairos" or "the Company")
ACQUISITION BY KAIROS OF THE ENTIRE ISSUED ORDINARY SHARE CAPITAL OF ERF
128/1 HATFIELD (PROPRIETARY) LIMITED
1. INTRODUCTION
Shareholders are advised that Kairos has entered into an agreement
dated 15 December 2011 to acquire the entire issued share capital of
Erf 128/1 Hatfield (Proprietary) Limited ("the Property Company").
Kairos will acquire the Property Company for a total purchase
consideration of R 3,000,000, which is the appraised value, to be
settled in cash, and funded out of cash.
2. NATURE OF THE ERF 128/1 HATFIELD (PROPRIETARY) LIMITED BUSINESS
Erf 128/1 Hatfield (Proprietary) Limited is the owner of the property
where the Kairos head office is located. Kairos currently rents this
property for an amount of R31,385 per month. In terms of this
transaction, Kairos will acquire the property by way of acquiring 100%
of the shares in Erf 128/1 Hatfield (Proprietary) Limited from Shefa
Investments No 2 (Proprietary) Limited. Shefa Investments No 2
(Proprietary) Limited (a related party) is the only shareholder in Erf
128/1 Hatfield (Proprietary) Limited. The only asset of Erf 128/1
Hatfield (Proprietary) Limited is the said property, being Portion 1
of Erf 128 Hatfield, Pretoria, Gauteng, in extent 1,276m2 and held
under Deed of Transfer T5741/1995.
3. RATIONALE FOR THE TRANSACTION
The transaction will provide Kairos with the opportunity to own the
property from which it operates, primarily allowing the Group to
reduce the ongoing cost related to office accommodation, and to also
improve its net return on assets.
4. CONDITIONS PRECEDENT
The transaction is subject, inter alia, to the following remaining
conditions precedent:
* the granting of all regulatory approvals, including that of the
JSE Limited ("JSE");
* obtaining the necessary shareholder approvals and board
resolutions of Kairos;
* cancellation of any covering bonds registered over the property;
* completion of a legal, financial and statutory due diligence
process by Kairos on Erf 128/1 Hatfield (Proprietary) Limited;
and
* no material adverse change having occurred between the signature
date and the date of fulfilment of the other conditions.
5. EFFECTIVE DATE
The effective date of the transaction will be the date on which all
conditions precedent are complied with, resulting in implementation of
the transaction.
6. FINANCIAL EFFECTS OF THE TRANSACTION
In compliance with paragraph 9.15 of the JSE Limited Listings
Requirements, pro forma financial effects must be disclosed to provide
information on the impact of the acquisition on Kairos`s reported
financial statements. These financial effects of the proposed
property transaction are determined as if the transaction was
effective by 31 August 2011 are set out below:
Before After %
Transaction Transaction change
Basic earnings per share 16.10 0.50
(EPS) (cents) 16.02
Headline loss per share (30.24) (30.16) 0.26
(HEPS) (cents)
Net asset value per share (9.37) (9.37) 0.00
(NAV) (cents)
Tangible net asset value (9.37) (9.37) 0.00
(TNAV) (cents)
Shares in issue (000`s) 224,554 224,554
Weighted average number 224,554 224,554
of shares in issue
(000`s)
Notes:
1. The EPS and HEPS in the "Before" column of the table are based on
the reviewed statement of comprehensive income of Kairos for the
interim period ended 31 August 2011 and 224,554,000 Kairos
ordinary shares in issue (being the weighted number of ordinary
shares in issue for the period ended 31 August 2011).
2. Interest earned was calculated at 5% per annum.
3. The EPS and HEPS in the "After" column of the table are based on
224,554,000 Kairos ordinary shares in issue and the assumptions
that the proposed property transaction was effective by 31 August
2011.
4. The NAV per share and TNAV per share in the "Before" column of
the table are based on the unaudited statement of financial
position of Kairos at 31 August 2011 and 224,554,000 Kairos
ordinary shares in issue.
5. The NAV per share and TNAV per share in the "After" column of the
table are based on the assumptions that the proposed property
transaction was effective by 31 August 2011.
6. The pro forma financial effects have not been reviewed by Kairos`
auditors.
7. ARTICLES OF ASSOCIATION
Kairos undertakes to amend the Memorandum of Incorporation of Erf
128/1 Hatfield (Proprietary) Limited, as required by Schedule 10 of
the JSE Listing Requirements.
8. TRANSACTION CLASSIFICATION
The transaction is classified as a Category 1 transaction in terms of
the Listing Requirements of the JSE ("the Listings Requirements") as
well as a related party transaction.
9. INDEPENDENT OPINION
In terms of the Listing Requirements, the transaction is classified as
a related party transaction due to a common shareholder being the
owner of 100% of the shareholding of Shefa Investments No 2
(Proprietary) Limited as well as the majority of the shareholding of
Kairos. The Kairos board of directors has appointed I Joubert, NDPV,
MIV (an approved independent registered property valuer) an
independent expert who has provided the company with an independent
valuation of the property.
10. CIRCULAR TO SHAREHOLDERS
The required circular relating to the transaction, and a notice of
general meeting and form of proxy will be posted to shareholders in
due course.
Pretoria
22 December 2011
Sponsor and Corporate Advisor: Bridge Capital Advisors (Pty) Limited
Attorneys to Kairos: Tugendhaft Wapnick Banchetti & Partners
Date: 22/12/2011 12:02:01 Supplied by www.sharenet.co.za
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