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DGC - Digicore Holdings Limited - Acquisition by Digicore of the remaining 30% of the issued share capital of Digicore Fleet Management SA (Pty) Limited DIGICORE HOLDINGS LIMITED (Incorporated in the Republic of South Africa) (Registration Number 1998/012601/06) Share code: DGC ISIN: ZAE000016945 ("DigiCore" or "the company") ACQUISITION BY DIGICORE OF THE REMAINING 30% OF THE ISSUED SHARE CAPITAL OF DIGICORE FLEET MANAGEMENT SA (PTY) LIMITED 1. INTRODUCTION 1.1 Shareholders are hereby advised that DigiCore has entered into an agreement to acquire the remaining 30% of the issued share capital of DigiCore Fleet Management SA (Proprietary) Limited ("DFM SA"), that is not already owned by DigiCore, from Western Breeze 135 (Pty) Limited (12.6%) and Amabubesi Investments (Pty) Limited (17.4%) (collectively hereinafter "the Vendors") for a total consideration of R13 200 000 ("the Acquisition"). 1.2 DigiCore already holds an interest of 70% in DFM SA. 1.3 Due to the fact that the Vendors are associates of Messers NA Gasa, BS Khuzwayo and SS Ntsaluba, directors of DigiCore, the Acquisition is deemed to be a "related party transaction" as contemplated in terms of paragraph 10.1(b)(vi) of the Listings Requirements of JSE Limited ("JSE"). However, as the Acquisition amounts to less than 5% of the market capitalisation of DigiCore as at 8 November 2011, the Acquisition is classified as a "small related party transaction" in terms of paragraph 10.7 of the JSE Listings Requirements. 1.4 Accordingly, this announcement is made for information purposes only and no action is required by DigiCore shareholders with regards to the Acquisition. 2. PARTICULARS OF THE ACQUISITION 2.1 DETAILS OF THE BUSINESS OF DFM SA DFM SA is a South African-based company regarded as a leading fleet management solutions provider servicing more than 5 000 companies and it constitutes the bulk of DigiCore`s corporate business in South Africa. DFM SA offers a wide range of vehicle location, fleet management, satellite navigation, workflow, mobile job planning and security tools. DFM SA employs over 350 staff members and has over 100 fully equipped mobile service vehicles. Distribution is through 8 strategically placed branches throughout the country. 2.2 RATIONALE FOR THE ACQUISITION The Acquisition is the result of the restructuring of a past BEE transaction, which allows the BEE shareholders to realise cash for their investment. 2.3 THE PURCHASE CONSIDERATION The total purchase consideration payable by DigiCore to the Vendors is R13 200 000 which will be settled in cash to the Vendors as follows: 2.3.1. Western Breeze 135 (Pty) Limited - R5 544 000; and 2.3.1. Amabubesi Investments (Pty) Limited - R7 656 000. The purchase price will be settled in 2 tranches, being a total of R3 906 371 on date of signature of the agreement and the balance is payable within 24 months from 25 July 2011, free of interest. DigiCore can effect the payment of the outstanding balance of the purchase consideration at any stage during the said 24 month period. 2.4 THE CONDITIONS PRECEDENT There are no outstanding conditions precedent relating to the Acquisition. 2.5 THE EFFECTIVE DATE The 30% stake in DFM SA will only be transferred from the Vendors to DigiCore after the purchase consideration has been settled in full. The Vendors will retain full shareholding and voting power until the date of transfer, and therefore the effective date of the Acquisition is 25 July 2013. 3. PRO FORMA FINANCIAL EFFECTS OF THE ACQUISITION
Set out in the table below are the pro forma financial effects of the Acquisition on the Company`s earnings per share ("EPS"), headline earnings per share ("HEPS"), net asset value per share ("NAV") and tangible net asset value per share ("TNAV"), based on the audited annual results for the year ended 30 June 2011, had the transaction been implemented as at 1 July 2010 for statement of comprehensive income purposes and on 30 June 2011 for statement of financial position purposes. The pro forma financial effects have been prepared for illustrative purposes only and, because of their nature, may not give a true reflection of the Company`s financial position, changes in equity, results of operations or cash flows. The pro forma financial effects are the responsibility of the Company`s directors. Audited Unaudited Change (%)
before Pro Forma acquisition after (cents) acquisition (cents)
Basic earnings per share 22.4 24.4 9 Basic headline earnings per share 22.2 24.2 9 Net asset value per share 247.9 249.6 1 Net tangible asset value per share 163.1 164.8 1 Notes: 1. The basic earnings per share and basic headline earnings per share figures in the "Pro Forma after acquisition" column have been calculated on the basis that the Acquisition was effected
on 1 July 2010. 2. The net asset value per share and net tangible asset value per share figures in the "Pro forma after acquisition" column have been calculated on the basis that the Acquisition was effected
on 30 June 2011. 3. The taxation rate applicable is assumed to be 28%. The basic earnings per share and basic headline earnings per share figures are calculated based on weighted average number
of shares in issue of 220 756 000 at 30 June 2011. 4. The net asset value per share and net tangible asset value per share have been calculated based on 247 669 000 shares in issue at 30 June 2011.
4. RELATED PARTY TRANSACTION 4.1 Due to the fact that the Acquisition is regarded to be a small related party transaction in terms of the Listings Requirements of the JSE, written confirmation is required from an independent expert confirming the fairness of the terms of the Acquisition to DigiCore shareholders. 4.2 Accordingly, DigiCore has appointed PKF Corporate Finance (Pty) Ltd ("PKF"), as the independent expert in accordance with paragraph 10.7(b) of the Listings Requirements of the JSE. 4.3 PKF has provided the JSE with written confirmation that the terms of the Acquisition are fair to DigiCore shareholders. The fairness opinion will lie open for inspection at the registered office of DigiCore for a period of 28 days from the date of publication of this announcement. 13 January 2012 Sponsor: PSG Capital (Pty) Limited Date: 13/01/2012 17:40:01 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.
