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Fulfilment of conditions precedent and withdrawal of Cautionary Announcement
Afrimat Limited
Incorporated in the Republic of South Africa
(Registration number: 2006/022534/06)
Share code: AFT ISIN: ZAE000086302
(“Afrimat” or “the Company”)
FULFILMENT OF CONDITIONS PRECEDENT AND WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT
1. INTRODUCTION
Afrimat shareholders are referred to the cautionary announcements published between 29 June 2012
and 19 December 2012 as well as the terms announcement on 18 January 2013 in respect of Afrimat
making an offer to acquire 50.4% of Infrasors Holdings Limited (“Infrasors”), being 93 461 108 Infrasors
shares, from Hanchurch Asset Managers (“Hanchurch”) and certain retiring management of Infrasors (“the
Sellers”), which has been accepted by the Sellers (“the Transaction”). Afrimat shareholders are advised that
all the conditions precedent have been met and the Transaction is now unconditional. As the financial
effects were not disclosed in the announcement on 18 January 2013, they are set out in paragraph 3
below.
2. MANDATORY OFFER
Arrangements are currently being made for the settlement and transfer of the Sellers Infrasors shares to
Afrimat. Once Afrimat obtain possession of the Sellers shares and become the controlling shareholder of
Infrasors, Afrimat will make an unconditional mandatory offer to all remaining Infrasors ordinary
shareholders in terms of section 123 of the Companies Act. A separate mandatory offer announcement will
be made one business day following Afrimat taking possession of the shares from the Sellers.
3. PRO FORMA FINANCIAL EFFECTS OF THE TRANSACTION ON AFRIMAT
The unaudited pro forma financial effects of Afrimat before and after the Transaction are based on the
unaudited results of Afrimat for the six months ended 31 August 2012. The unaudited financial effects
are presented for illustrative purposes only, to provide information on how the acquisition may have
impacted on the results and financial position of Afrimat. The unaudited pro forma financial effects are
the responsibility of Afrimat's directors. Due to the nature of the unaudited pro forma financial effects,
they may not fairly present Afrimat's financial position and the results of its operations after the
acquisition. It has been assumed for the purpose of the financial effects that the acquisition took place
with effect from 1 March 2012 and that 100% of the Infrasors shares will be acquired. The financial
effects do not purport to be indicative of what the financial results would have been, had the acquisition
been implemented on a different date. The unaudited pro forma financial information has been
presented in a manner consistent in all respects with IFRS and Afrimat's accounting policies applied
consistently throughout the period.
The financial effects of the Transaction are set out below:
Before the After the %
Transaction Transaction change
Amount Amount
Basic earnings per share (EPS) (cents) 35.2 35.7 1.4
Diluted earnings per share (EPS) (cents) 34.3 34.9 1.7
Headline earnings per share (HEPS) (cents) 35.0 35.3 0.8
Diluted headline earnings per share (HEPS)
(cents) 34.2 34.4 0.6
Net asset value per share (NAV) (cents) 504 504 0.0
Tangible net asset value (TNAV) (cents) 392 393 0.3
Shares in issue 143,262,412 143,262,412 0
Weighted average number of shares in issue 142,593,027 142,593,027 0
Diluted weighted average number of shares in
issue 146,178,128 146,178,128 0
Notes:
1. The “% Change” column of the table is the result of the actual calculations whereas the “Before the
Transaction” and “After the Transaction” columns of the table are rounded figures, as reflected in
the unaudited results of Afrimat for the period ended 31 August 2012.
2. The EPS and HEPS in the “Before the Transaction” column of the table are based on the
unaudited statement of comprehensive income of Afrimat for the interim period ended 31 August
2012 and 142,593,027 Afrimat ordinary shares in issue (being the weighted number of ordinary
shares in issue for the interim period ended 31 August 2012, net of treasury shares).
3. The Diluted EPS and HEPS in the “Before the Transaction” column of the table are based on the
unaudited statement of comprehensive income of Afrimat for the interim period ended 31 August
2012 and 146,178,128 Afrimat ordinary shares in issue (being the weighted diluted number of
ordinary shares in issue for the period ended 31 August 2012)
4. The EPS and HEPS in the “After the Transaction” column of the table are based on 142,593,027
Afrimat ordinary shares in issue and the assumptions that:
- the acquisition became effective on 1 March 2012 and the purchase price was settled on
that date;
- interest received has been reduced by R 1,623,310 assuming that the cash utilised for the
purchase price could have been invested on the Money Market at an after-tax rate of
3.6%, yielding an annual after-tax interest of R 1,168,783; and
- the purchase price was settled in cash.
5. The Diluted EPS and HEPS in the “After the Transaction” column of the table are based on
146,178,128 Afrimat ordinary shares in issue and the assumptions that:
- the acquisition became effective on 1 March 2012 and the purchase price was settled on
that date; and
- the purchase price was settled in cash.
6. The NAV per share and TNAV per share in the “Before the Transaction” column of the table are
based on the unaudited statement of financial position of Afrimat at 31 August 2012 and
143,262,412 Afrimat ordinary shares in issue.
7. Afrimat have made fair value adjustments to certain of Infrasors’s statement of financial position
line items, these include Property, Plant and Equipment, Investment Properties, Mineral Rights,
Held to Maturity Investments and Deferred Tax to the value of R 398.734 million.
8. Further to this, negative goodwill of R 388,000 result from the Transaction. Negative goodwill is
measured as the shortfall of the sum of the purchase consideration, the amount of any non-controlling
interests in the acquiree, and the fair value of the acquirer's previously held equity interest in the
acquiree (if any) over the net of the acquisition date amounts of the identifiable assets acquired and the
liabilities assumed.
9. The NAV per share and TNAV per share in the “After the Transaction” column of the table are
based on the assumptions that the acquisition was completed on 1 March 2012.
10.The pro forma financial effects have not been reviewed by Afrimat’s auditors.
4. WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT
Following the disclosure of financial effects and the terms of the Transaction, shareholders are no
longer required to exercise caution when dealing in their Afrimat ordinary shares and accordingly, the
cautionary announcement released by Afrimat on 18 January 2013 is hereby withdrawn.
Cape Town
8 February 2013
Sponsor and Corporate Advisor to Afrimat: Bridge Capital Advisors (Pty) Limited
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