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Detailed Cautionary Announcement
Country Bird Holdings Limited
(Incorporated in the Republic of South Africa)
(Reg. no 2005/008505/06)
Share Code: CBH
ISIN: ZAE000094835
(“CBH Ltd”)
Detailed Cautionary Announcement
Shareholders are advised that CBH Ltd has entered into negotiations with the
International Finance Corporation (“IFC”), to secure funding to enable CBH
Ltd to continue with its on-going commitment to expand its geographic
footprint in the African continent.
The IFC is considering the possibility of investing the ZAR equivalent of up to
USD 25 million in the form of a convertible instrument, which instrument would
have a term of 5 years and would bear interest at a variable rate calculated
with reference to the 6 month Libor rate plus 3% per annum for the initial 2,5
years (“Initial Period”). In the event that the loan is not converted to equity in
the Initial Period the loan then becomes a term loan bearing interest at 4,5%
above the 6 month Libor rate. The IFC will have an option to convert a portion
or the whole of the principal amount into CBH Ltd ordinary shares in multiple
tranches at any time during the Initial Period at a price of R 4,90 per share,
provided the IFC shareholding in CBH Ltd does not exceed 18%. The
ZAR/USD exchange rate that will be used to translate the USD amount in the
event of a conversion is ZAR 8,869=$1 which will result in the issue of 45 250
000 CBH shares in the event of the exercise of the full conversion option. The
prevailing ZAR/USD exchange rate as reported on Reuters at 08h00 am
South African time on Friday 22 February 2013 was ZAR8,869/1USD.
If the negotiations between the IFC and CBH Ltd are successful, the
transaction so described in the preceding paragraph will be subject to the
fulfillment of various suspensive conditions to the satisfaction of the both
parties. The funding would be utilised to increase chick production in Zambia
and Botswana, to expand the feedmill capacity in Zambia, to increase broiler
meat processing capacity and to construct soya bean deactivation plants at
two of its feedmills.
CBH Ltd has selected the IFC as its strategic partner in its African protein
growth plans. The IFC will provide CBH Ltd with its technical expertise, global
knowledge of the industry and markets, as well as experience gained from
other integrated poultry projects, which are valuable resources to CBH Ltd.
The IFC further supports CBH Ltd’s long-term regional project scope with
tailor-made financing by the IFC which will assist CBH Ltd with resource
efficiency management programmes.
The full impact of these negotiations, if successful, is currently being
determined and may have a material effect on the price of the CBH Ltd’s
securities. Accordingly, shareholders are advised to exercise caution when
dealing in the CBH Ltd’s securities until a further announcement is made.
In accordance with the World Bank Group requirements, a summary of the
investment information has been placed on the IFC website: www.ifc.org.
Shareholders are also referred to CBH Ltd’s website, www.cbh.co.za, for
more information.
22 February 2013
Investment Bank and Sponsor:
Investec Bank Limited
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