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Acquisition of remaining interest in BDFM
TIMES MEDIA GROUP LIMITED
(Formerly Richtrau No. 229 Proprietary Limited)
(Incorporated in the Republic of South Africa)
Registration number 2008/009392/06
Ordinary share code: TMG
Ordinary share ISIN: ZAE 000169272
("TMG" or "the Company")
ACQUISITION OF REMAINING INTEREST IN BDFM
1. INTRODUCTION
TMG is pleased to announce that Avusa Publishing Proprietary Limited,
a subsidiary of TMG, has reached an agreement with Pearson Overseas
Holdings Limited (“Pearson”) to acquire Pearson’s 50% shareholding in
BDFM Publishers (Pty) Limited (“BDFM”) and all of Pearson’s claims
against BDFM, its subsidiaries and/or associates (other than claims
which may arise in terms of the syndication agreement referred to
below), such that following the implementation of the acquisition
Avusa Publishing Proprietary Limited will BDFM’s sole shareholder
(“Acquisition”).
2. BACKGROUND INFORMATION ON BDFM
BDFM owns the titles and publishes the "Business Day" and "Financial
Mail". BDFM owns 100% of African Broadcasting Channel (Pty) Limited
which broadcasts Summit, Home Channel, Ignition and Saffron channels
on DSTV in Southern Africa.
3. RATIONALE FOR THE ACQUISITION
Newspapers and the entire news industry are undergoing fundamental
structural change, requiring new investment, new ways of doing
business and often difficult decisions.
The full acquisition of BDFM by TMG will allow for economies of
scale, an integrated operations platform and operational synergies,
and will permit BDFM, under unified ownership, to accelerate its
digital transformation. Importantly, the Acquisition agreement
supports editorial independence through an independent Editorial
Committee as outlined below. In addition, TMG believes it can further
develop and enhance the current BDFM television offering which it
believes could be a growth area.
BDFM will continue to have an ongoing relationship with the Financial
Times Limited (“FT”) through a content syndication agreement, and a
programme through which BDFM journalists benefit from training
placements at the FT.
4. INDEPENDENT EDITORIAL COMMITTEE
It is a condition of the Acquisition that the board of directors of
BDFM (the “Board”) establishes an Independent Committee in terms of
section 72 of the Companies Act, 2008, as amended.
The committee will be governed by and be subject to a separate
document (“Terms of Reference”) that outlines the committee’s role
and composition. Briefly the main functions of the Independent
Committee will be to:
-Provide input to the Board regarding the appointment and dismissal
of editors from time to time of the titles "Business Day" and
"Financial Mail", and any other standalone daily or weekly titles
published by BDFM, and approve (or reject) such appointment or
dismissal proposed by the Board;
-Hear and adjudicate on any disputes referred to it by an editor that
may arise in relation to the interpretation, implementation of and/or
compliance with an agreed “Editorial Charter”, which is designed to
ensure that the aforesaid editors uphold the highest standards of
professional, independent, honest, responsible and accurate
journalism, and will adhere to the highest ethical standards at all
times.
-Provide input to the Board regarding any amendments to the Editorial
Charter and approve (or reject) any amendments to the Editorial
Charter proposed by the Board.
5. CONDITIONS FOR THE ACQUISITION
The Acquisition is subject to the fulfilment (and, if applicable,
waiver, as envisaged in the Acquisition agreement) of the following
suspensive conditions:
-To the extent required, approval of the conclusion and
implementation of the Acquisition agreement in terms of the Currency
and Exchanges Act, 1933, and the regulations promulgated thereunder;
-The establishment of the Independent Committee and the appointment
of three members to the Independent Committee, one by the Board and
two by Pearson, in accordance with the agreed Terms of Reference;
-The adoption by BDFM of the Editorial Charter;
-The amendment of BDFM’s memorandum of incorporation to incorporate
the agreed Terms of Reference and the Editorial Charter, and the
filing of the requisite special resolution with the Companies and
Intellectual Property Commission;
-Such regulatory approval as may be required to implement the
Acquisition, including approval from the competition authorities; and
-The conclusion of a new lease agreement between FT and TMG relating
to the lease by FT of office space utilised by its employees working
in South Africa.
6. EFFECTIVE DATE
The effective date of the Acquisition is the 3rd business day after
the date on which the last of the aforementioned conditions are
fulfilled or waived, as the case may be.
7. WARRANTIES AND MATERIAL TERMS
The Acquisition is subject to warranties that are normal for a
transaction of this nature.
8. CLASSIFICATION OF THE ACQUISITION
The Acquisition does not qualify as a category 2 acquisition in terms
of the Listings Requirements of the JSE Limited and therefore this
announcement is a voluntary announcement for information purposes
only.
15 April 2013
Johannesburg
Sponsor
PSG Capital
Legal Adviser
Edward Nathan Sonnenbergs Inc
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