MUVONI TECHNOLOGY GROUP LTD - Acquisition Related Party Transaction

Acquisition  Related Party Transaction

  Muvoni Technology Limited (Formerly Ideco Group Limited)
  (Incorporated in the Republic of South Africa)
  (Registration number: 2001/023463/06)
  Share code: MTG
  ISIN code: ZAE000167268
  ("Muvoni" or "the Company")


1. TERMS ANNOUNCEMENT – PURCHASE OF THE INTELLECTUAL
  PROPERTY DEVELOPED BY ZNG TECHNOLOGIES AG (“ZNG”)


  Further to the cautionary announcement released on SENS
  on 19 September 2012, shareholders are hereby advised
  that the Company, through a wholly owned subsidiary,
  Ideco AFISwitch (Pty) Limited (“the Purchaser”)has
  entered into a Purchase agreement with ZNG ("the Seller")
  whereby the Company will purchase the intellectual
  property relating to the software developed by the Seller
  and used by the Purchaser to conduct criminal record
  checks against the SAPS database within South Africa,
  pursuant to the AFISwitch project ("the Purchase"),
  subject to the fulfilment of the conditions precedent as
  set out below.
2. THE SALE ASSET
  The Sale Asset means the intellectual property relating
  to software developed by the Seller and used by the
  Purchaser to conduct criminal record checks against the
  SAPS fingerprint database within South Africa pursuant to
  the AFISwitch project which comprises the software, know
  how, intellectual property, branding, the source code and
  documentation.
3. PURCHASE CONSIDERATION
  3.1   The consideration payable by the Company to the
        Seller in terms of the Purchase shall be an amount
          of R6,500,000 (six million five hundred thousand
          Rand).
  3.2     The Purchase Price shall be payable as follows:
    3.2.1 an amount of R2,500,000 (two million five hundred
          thousand Rand) in cash on the Implementation Date;
    3.2.2 the balance of R4,000,000 (four million Rand)
          will be paid in two equal instalments of R2,000,000
          (two million Rand) each.   The first of which will be
          payable 30 days after the Implementation Date, and
          the second instalment will be payable 30 days after
          payment of the first instalment.


4. RATIONALE FOR THE PURCHASE
  The board was approached by the Seller to purchase the
  Sale Asset as opposed to paying a monthly royalty fee.
  The Board believes that it is in the Company’s best
  interest to purchase the Sale Asset.
5. THE EFFECTIVE DATE OF THE PURCHASE
  The effective date of the purchase will be 1 September
  2012.
6. CONDITIONS PRECEDENT
  The Purchase is subject to, inter alia, the following
  conditions precedent:
  6.1 all relevant resolutions have been adopted and steps
  have been taken by the Parties so as to enter into and
  implement this Agreement;
  6.2 the Purchaser has confirmed in writing that there has
  been compliance with all applicable JSE Limited Listings
  Requirements (“Listing Requirements’”) for purposes of
  entering into and implementing this Agreement;
  6.3 all approvals from the South African Reserve Bank
  have been obtained for purposes of entering into and
  implementing this Agreement;
  6.4 the Seller has confirmed in writing to the
   satisfaction of the Purchaser that any and all requisite
   consents have been obtained from any third parties,
   including but not limited to neaMetrics (Proprietary)
   Limited(“neaMetrics”), in relation to the sale of the
   Sale Assets;
   6.5 a non-compete agreement has been entered into between
   neaMetrics and the Purchaser and has become unconditional
   in all respects.
7. PRO FORMA FINANCIAL EFFECTS
   The pro forma financial effects relating to the Purchase
   will be communicated to shareholders in due course.
8. RELATED PARTY TRANSACTION
   The Seller is a material shareholder and is therefore
   regarded as a related party in terms of the Listings
   Requirements and the Purchase will require an independent
   fairness opinion.
9. INDEPENDENT EXPERT
   In accordance with the Companies Act and the Listings
   Requirements, an independent expert will be appointed to
   provide an independent expert opinion on the Purchase.
   The independent expert opinion on the Purchase
   will be contained in the circular that will be sent to
   shareholders.
10.FURTHER DOCUMENTATION AND SALIENT DATES
   Further details of the Purchase will be included in the
   Circular containing a notice of general meeting which
   will be sent to shareholders in due course. The salient
   dates in relation to the Purchase and the pro forma
   financial effects of the Purchase will be published prior
   to the issuing of the aforementioned circular.
11.RENEWAL OF CAUTIONARY
   Muvoni shareholders are advised to continue to exercise
   caution when dealing in Muvoni securities until such time
   as the pro forma financial effects of the Purchase have been 
   announced to Muvoni shareholders.

Johannesburg


11 October 2012
Corporate Advisor
DEA-RU(Pty) Limited


Designated Advisor
Sasfin Capital
(a division of Sasfin Bank Limited)

Date: 11/10/2012 03:55:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
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