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BARLOWORLD LIMITED - Barlworld Limited - Small related party acquisition

Release Date: 25/09/2012 15:00
Code(s): BAWP BAW     PDF:  
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Barlworld Limited - Small related party acquisition

Barloworld Limited
(Incorporated in the Republic of South Africa)
(Registration number 1918/000095/06)
(Share code: BAW)
(JSE ISIN: ZAE000026639)
(Share code: BAWP)
(JSE ISIN: ZAE000026647)
(Bond issuer code: BIBAW)
(“Barloworld” or “the Company”)Barloworld Limited


ACQUISITION BY BARLOWORLD LOGISTICS (PROPRIETARY) LIMITED (A
WHOLLY OWNED SUBSIDIARY OF BARLOWORLD LIMITED)(“BWL”) OF THE
REMAINING 25% STAKE IN BARLOWORLD LOGISTICS AFRICA (PROPRIETARY)
LIMITED (“BLA”) FROM OLD PRIORY INVESTMENTS (PROPRIETARY) LIMITED
(“OLD PRIORY”) (“THE TRANSACTION”)


1. Introduction and rationale

In 2005, BWL entered into an empowerment transaction with Old
Priory. In terms of this initial transaction, BWL sold 25% of the
shares and claims in BLA to Old Priory and Barloworld provided
security for the required loan funding.

The shareholders in BLA have decided to enter into a Sale of
Shares and Claims agreement whereby BWL will acquire the interests
of Old Priory in BLA. This Transaction will unlock value for the
minority shareholders at the end of the seven year funding term
and provides a platform for growing BLA.

The Transaction will be funded from existing funding facilities.

2. The consideration and conditions precedent

The cash consideration of R125,000,000.00 for the shares will be
settled on closing of the Transaction which is expected around 1
October 2012. In addition, the loan funding of R50,242,884.93
(capital and interest) will be settled with Nedbank on 2 October
2012.

The following are the conditions precedent to the Transaction:
     1. The approval of the Transaction by Old Priory in terms of
        a special resolution of the shareholders of Old Priory in
        accordance with section 115 of the Companies Act 71 of
        2008.
     2. Obtaining of all consents and approvals required for the
        entering into and implementation of the Transaction in
        terms of the JSE Listings Requirements (“Listings
        Requirements”) of the JSE Limited.
     3. Undertaking from Nedbank that payment of the loan funding
        by BWL on 2 October 2012 will constitute full and final
        settlement of all amounts due by Old Priory arising from
        the Nedbank loan funding, and that Barloworld is released
       from its obligations in terms of the original loan funding
       agreement.


3. Pro forma financial effects

  In terms of the Listings Requirements, the effects of the
  Transaction are not significant and are below the reporting
  threshold.

4. Categorisation and related party

Mr Isaac Shongwe, a director of Barloworld, is a shareholder of
Old Priory and in addition Old Priory is a material shareholder in
BLA (a subsidiary of BWL), therefore the transaction is a related
party transaction as defined in the Listings Requirements. The
Transaction is classified as a small related party transaction.

5. Independent Expert

In terms of Section 10.7 of the Listings Requirements the Company
has appointed PricewaterhouseCoopers Corporate Finance as the
independent professional expert in order to provide an opinion on
the fairness of the transaction.

A further announcement in this regard will be released in due
course.


Sandton
25 September 2012

Legal advisors: Bowman Gilfillan
Sponsor: J.P. Morgan Equities Limited
Independent expert: PricewaterhouseCoopers Corporate Finance (Pty)
Ltd

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