Financial effects and withdrawal of cautionary announcement IFA Hotels & Resorts Limited Registration number 1919/001318/06 Share code: IFH ISIN: ZAE000075669 ("IFA" or "the Company”) -FULFILMENT OF CONDITIONS PRECEDENT TO THE DISPOSAL OF IFA BOSCHENDAL -FINANCIAL EFFECTS AND WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT OF THE IFA BOSCHENDAL DISPOSAL -WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT RELATING TO THE INTRODUCTION OF POTENTIAL INVESTORS 1. Conditions Precedent and IFA shareholders’ approval 1.1 IFA Boschendal Investments (Pty) Ltd (“IFA Boschendal”) IFA shareholders are referred to the announcements released on SENS on 8 August and 17 August 2012 and are advised that the conditions precedent relating to the Disposal by IFA Boschendal in terms of which Canombys Limited will acquire, as one indivisible transaction, all of IFA Boschendal’s shares and claims in Boschendal(Pty)Limited (“Boschendal”)(“the Transaction”) were fulfilled on Wednesday, 22 August 2012 and the Transaction was concluded on Friday, 24 August 2012. 1.2 IFA An IFA shareholders meeting will be convened so as to obtain IFA shareholders approval by way of special resolution as required in terms of Section 115(2)(b)(ii) of the Companies Act, 71 of 2008 (as amended) and the JSE Limited Listings Requirements as set out in more detail in paragraph 3 below. 2. Unaudited pro forma financial information of the Transaction The pro forma financial information is based on the published year-end results of IFA for the 18 months ended 31 December 2011. The preparation of the pro forma financial information is the responsibility of the Directors. The unaudited pro forma financial effects have been prepared to illustrate the impact of the Transaction on the audited financial information of IFA for the 18 months ended 31 December 2011. The unaudited pro forma financial effects have been prepared using accounting policies that comply with IFRS and that are consistent with those applied in the audited results of IFA for the 18 months ended 31 December 2011. 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 IFA’s financial position and results after the Transaction. Before After Pro forma 31 December Adjustments 20111 2,3 % (cents) (cents) Change4 (Loss) per ordinary share (62.45) (59.33) 4.99% (cents) Headline (loss) per share (18.11) (12.97) 28.39% Net asset value per share (26.07) (29.00) 11.24% (cents) Net tangible asset value (27.13) (30.06) 10.80% per share (cents) Number of ordinary shares 218 210 680 218 210 680 0 in issue / Weighted average number of ordinary shares in issue Notes: 1. The “Before” basic loss and headline loss per share have been extracted without adjustment from the audited, published results of IFA for the 18 months ended 31 December 2011. The “Before” net asset value and tangible net asset value per share have been calculated from the financial information presented in the audited, published results of IFA for the 18 months ended 31 December 2011. 2. The “After pro forma adjustments” loss per share and headline loss per share assumes: o Recognition of the loss on disposal of shares and claims in Boschendal, being the excess of the carrying value of the investment and claims in Boschendal over the expected proceeds on the disposal. This will not have a continuing effect on IFA’s financial results. o Transaction costs of approximately R934 306 directly relating to the transaction. This will not have a continuing effect on IFA’s financial results. o Reduction in interest income not accrued from the loan provided to Boschendal at an interest rate of 8%, as a result of the Disposal of the claims in Boschendal and the reversal of the tax effect at a company tax rate of 28%. This will have a continuing effect on IFA’s financial results. o Reversal of IFA’s share of the Boschendal loss for the 18 months ended 31 December 2011. This will have a continuing effect on IFA’s financial results. o Reduction in interest expense not accrued on loans repaid from the proceeds of the Transaction, at an interest rate of 8%, and the reversal of the tax effect at a company tax rate of 28%. This will have a continuing effect on IFA’s financial results. 3. The “After pro forma adjustments” net asset value and net tangible asset value per share assumes: o Reversal of the carrying value of the loan to Boschendal. o Raising of R80.0 million, in cash, received as consideration for the disposal of the shares and claims in Boschendal. o Payment of transaction costs of approximately R934 306 directly related to the Transaction. o Repayment of loans provided by group companies of an amount of R10.5 million o Repayment of the loan provided by Nedbank Limited, secured by IFA Boschendal, of an amount of R53.8 million. o Recognition of the loss on disposal of the shares and claims in Boschendal. 4. Measured as the “After pro forma adjustments” column as a percentage of the “Before” column. 3. Posting of the circular In addition to the above, shareholders are also referred to the announcement released by the Company on 20 July 2012 relating to the posting of the circular to IFA shareholders. Shareholders are hereby advised that obtaining property valuation report/s on the Transaction from the independent registered valuer took longer than initially envisaged and therefore the circular to IFA shareholders will be posted on or about 17 September 2012. 4. Withdrawal of cautionary announcement relating to Transaction IFA Shareholders are advised that the cautionary announcement relating to the above Transaction is hereby withdrawn following the release of the above financial effects. 5. Withdrawal of cautionary announcement relating to the introduction of potential investors IFA Shareholders are referred to the original announcement in this regard which was released on 28 October 2011 and the subsequent renewals thereof, the last of which was released on 17 August 2012. IFA Shareholders are advised that while the process to introduce potential investors intothe business is ongoing, it has not resulted in any corporate action to date and the said cautionary announcement is hereby withdrawn. Directors will continue to pursue avenues to maximise shareholder value and will release an announcement should circumstances require. Zimbali 06 September 2012 Sponsor: Sasfin Capital (a division of Sasfin Bank Limited) Legal Advisor: Larson Falconer Incorporated Corporate Advisor: DEA-RU (Pty) Ltd Date: 06/09/2012 07:30:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 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