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Sale of Wholesale Timber Business and withdrawal of cautionary announcement
Iliad Africa Limited
Incorporated in the Republic of South Africa
(Registration number 1997/011938/06)
Share Code ILA ISIN ZAE000015038
(“Iliad” or “the company”)
SALE BY ILIAD AFRICA LIMITED (THROUGH ITS WHOLLY OWNED SUBSIDIARIES
ILIAD AFRICA TRADING (PTY) LTD AND UNITED TUBE (PTY) LTD) ("ILIAD”) OF ITS
WHOLESALE TIMBER BUSINESS AS A GOING CONCERN AND WITHDRAWAL OF
CAUTIONARY ANNOUNCEMENT
Introduction
Iliad is pleased to announce that Iliad Africa Trading (Pty) Limited and United Tube (Pty) Ltd,
both wholly-owned subsidiaries of Iliad, have accepted an offer dated 13 March 2013 in
terms of which Iliad will sell its Timber Wholesale business to Agentimber Proprietary
Limited, a wholly owned subsidiary of York Timber Holdings Limited (Registration number
1916/004890/06) (“York”) ("the sale transaction").
Rationale for the sale transaction
The on-going review and optimisation of the Iliad portfolio culminated in the decision by Iliad
to accept the offer from York.
Overview of the sale transaction
York will acquire the defined tangible operating assets, defined liabilities and intangible
assets of the Timber Wholesale business as a going concern, as at the effective date which
is to be determined after regulatory approval has been obtained.
Details of the sale transaction
Sale consideration
The sale price in respect of the above sale transaction is the net asset value (“NAV”) of R
45.5 million, payable in cash, subject to a NAV adjustment on the effective date.
The proceeds of the sale transaction will be utilised to fund working capital requirements and
future growth.
Conditions precedent
The transaction is subject to inter alia, the approval of the sale transaction by the
Competition authorities in terms of the Competition Act, or conditional approval on terms and
conditions acceptable to both parties.
Other than as disclosed in this announcement, there are no other significant terms to the sale
transaction.
Effective date
The effective date which is to be determined after regulatory approval has been obtained.
It is anticipated that the conditions precedent will be fulfilled prior to 1 June 2013.
Pro forma financial effects of the sale transaction
The unaudited pro forma financial effects of the sale transaction are the responsibility of the
directors of Iliad and are presented for illustrative purposes only, to provide information about
how the sale transaction might impact the financial results of Iliad. Due to its nature, the pro
forma financial effects may not necessarily give a fair reflection of Iliad’s financial position
subsequent to the sale transaction.
These pro forma financial effects are based on Iliad's results for the year ended 31
December 2012, which results are to be published on 18 March 2013, adjusted for the sale of
the Timber Wholesale business.
Save as set out hereunder there is no material impact on either the earnings or assets of Iliad
as a result of the above transaction.
Before the After the Percentage
transaction¹ transaction² ³ change
4
Earnings per share 24.3 50.4 107.2
(cents)
Headline earnings 46.3 56.5 22.0
per share (cents)
Net asset value per 571.5 597.6 4.6
share (cents)
Net tangible asset
value per share 402.1 428.2 6.5
(cents)
Weighted average
number of shares in 138 218 138 218 -
issue ('000)
Number of shares in 138 218 138 218 -
issue ('000)
Notes:
1. Extracted from the audited financial results of Iliad for the year ended 31 December 2012.
2. The earnings and headline earnings per share figures in the "After the transaction" column have been based on
the following assumptions:
- the effective date of the disposal was 1 January 2012; and
- interest, at an average before tax rate of 6.7% per annum, was earned on the cash received.
3. The net asset value and net tangible asset value per share figures in the "After the transaction" column have
been based on the assumption that the disposal price was paid on 1 January 2012.
4. Inclusive of the 2012 Thorpe Timber trademark impairment to the value of R22 million.
5. The pro forma financial effects have not been reviewed by Iliad’s auditors.
Categorisation
This is a category two transaction per the categorisation rules contained in the JSE Listings
Requirements.
Withdrawal of cautionary announcement
Following the disclosure of the terms and financial effects of the sale transaction,
shareholders are no longer required to exercise caution when dealing in their Iliad shares and
accordingly, the cautionary announcement released by Iliad on 21 February 2013 is hereby
withdrawn.
Johannesburg
18 March 2013
Sponsor: Bridge Capital Advisors (Pty) Limited
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