W G WEARNE LIMITED - Disposal of 50% interest in Wearne Drilling & Blasting (PTY) LTD and cautionary announcement

Disposal of 50% interest in Wearne Drilling & Blasting (PTY) LTD and cautionary announcement

WG Wearne Limited
(Incorporated in the Republic of South Africa)
(Registration number 1994/005983/06)
JSE Share Code: WEA ISIN: ZAE000078002
(“Wearne” or “the company”)


DISPOSAL OF 50% INTEREST IN WEARNE DRILLING & BLASTING (PTY) LTD (“Wearne D&B”)
AND CAUTIONARY ANNOUNCEMENT


1. INTRODUCTION

     Shareholders are advised that on 28 February 2013, Wearne entered into a Sale of Shares Agreement with
     Mr AC van Heerden (“the purchaser”) to sell its 50% interest in Wearne D&B, a Joint Venture between
     Wearne and the purchaser, for R4.7 million (“the disposal”), subject to a condition precedent.
     Mr AC van Heerden is a board member of Wearne D&B. The JSE has ruled that the disposal is not a related
     party transaction as Wearne D&B is a Joint Venture.

2. RATIONALE FOR DISPOSAL

     The company has suffered financial losses in the past financial years and in its efforts to achieve
     profitability and improve on performance, the directors concluded it would be in the group’s best interests
     to dispose of its non core business activities. This will allow for more focus being placed on the group’s
     core business activities of supplying building materials to the construction industry in the hopes of
     achieving profitability as well as reducing debt and working capital requirements.

3.    DESCRIPTION OF WEARNE D&B

      Wearne Drilling and Blasting was established on 02 August 2007 as a joint venture between Wearne Ltd
      and Mr AC van Heerden. The company is engaged in drilling and blasting of rock in all of its aspects and
      anything allied thereto and operates principally in South Africa.

4.    DETAILS OF THE DISPOSAL

4.1 Wearne agreed to sell its 50% interest in Wearne D&B for R4.7 million, subject to a condition precedent,
    with effect from 1 March 2013.
4.2 The purchase price will be used by Wearne to settle its amount owing with Wearne D&B.
4.3 The purchaser has entered into a restraint of trade with Wearne for a twelve month period.
4.4 SJ Wearne and JJ Bierman have resigned as directors of Wearne D&B with effect from 28 February 2013.
4.5 The purchaser will change the name of Wearne D&B.

5.    CONDITION PRECENDENT

      The disposal is subject to the fulfilment by no later than 31 March 2013, of the condition that the purchaser
      procures the release of Wearne from all the suretyships provided by Wearne for the obligations of Wearne
      D&B to the banks and third parties.

6.    FINANCIAL EFFECTS OF THE DISPOSAL


      The financial effects will be announced in due course.

7.    CATEGORISATION OF THE DISPOSAL

      The disposal is categorised, in terms of the JSE Limited’s Listings Requirements, as a Category 2
      transaction and does not require shareholders’ approval.

8.    CAUTIONARY ANNOUNCEMENT
     Shareholders are advised to exercise caution in dealing in the company’s securities on the JSE until such
     time as the financial effects of the disposal are published.

9.   FURTHER ANNOUNCEMENT

     Shareholders will be notified once the disposal is unconditional.


     1 March 2013
     Johannesburg


     Designated Adviser
     Exchange Sponsors

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