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The proposd disposal of Purple Capital's Gaming interests
PURPLE CAPITAL LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1998/013637/06)
Share code: PPE ISIN: ZAE000071411
(“Purple Capital” or “PCL” or “the company”)
ANNOUNCEMENT REGARDING THE PROPOSED DISPOSAL OF
PURPLE CAPITAL’S GAMING INTERESTS (“PGI”)
(“THE DISPOSAL” OR “THE TRANSACTION”)
1. INTRODUCTION
Purple Capital shareholders are advised that Sun International Limited (“Sun International”) has made an
offer to acquire 100% of PCL’s interests in PGI dated 8 May 2013 (“the Offer”) which has been approved
by the board of directors of PCL.
2. BACKGROUND INFORMATION ON PGI
Purple Gaming’s interests comprise the following wholly owned interests:
• Powerbet Gaming (Pty) Limited (“PBG”), which owns and operates Voltbet.com which is an online
fixed-odds sports betting operator, along with the required bookmaking licence issued by the Western
Cape Racing and Gambling Board (“WCRGB”);
• the sports betting software which is developed and operated by PBG and the associated manufacturing
licence issued by WCRGB; and
• Purple Capital Gaming (Pty) Limited (“PCG”), which holds a bookmaking licence in Tanzania.
3. RATIONALE
Voltbet.com is in a rapidly expanding industry in South Africa, requiring capital and distribution capacity
beyond that currently within the Purple Capital Group. Sun International is ideally positioned to take Voltbet.
com through its next growth phase.
The timing of the proposed disposal of Voltbet.com is ideal in the context of the restructuring and core
business focus of PCL on GT247.com and Emperor Asset Management, as outlined in the interim results
announcement published on 11 April 2013.
4. DETAILS OF THE DISPOSAL
In terms of the Offer, PCL will sell 100% of the issued share capital and shareholder loan accounts
for R30 million (thirty million rand) in cash, which will be settled subsequent to the signing of definitive
agreements and the fulfilment of all conditions precedent referred to in paragraph 5 below.
The effective date of the Disposal will be subject to the conditions precedent in paragraph 5 being fulfilled
(“the Effective Date”).
5. CONDITIONS PRECEDENT
The Offer has been approved by the board of directors of PCL but remains subject to the fulfilment of the
following conditions precedent:
5.1 Sun International will conduct a review exercise to confirm the assumptions made in formulating
the Offer and there being no material adverse circumstances having arisen, as determined by Sun
International and its advisors;
5.2 the conclusion of definitive legal agreements;
5.3 the receipt of regulatory approvals, to the extent required by law, in each case unconditionally from
the JSE Limited (“JSE”), the Takeover Regulation Panel, the Competition Authorities, the Exchange
Control Department of the South African Reserve Bank (to the extent required), the WCRGB and any
other regulatory approvals that may be required in the various jurisdictions that PCL operates its
gaming interests in;
5.4 PBG holding the required manufacturing licence relating to the sports betting software; and
5.5 final approval of the Offer by the Sun International Board.
6. PRO FORMA FINANCIAL EFFECTS
The table below sets out the unaudited pro forma financial effects of the Transaction on the published
results of Purple Capital for the six months ended 28 February 2013. The unaudited pro forma financial
effects have been prepared for illustrative purposes only and because of their nature may not fairly present
Purple Capital’s financial position, changes in equity, results of operations or cash flows, nor the effect and
impact of the Transaction going forward.
The directors of Purple Capital are responsible for the compilation, contents and preparation of the
unaudited pro forma financial effects of the Transaction. Their responsibility includes determining that the
unaudited pro forma financial effects have been properly compiled on the basis stated, which is consistent
with the accounting policies of Purple Capital and the pro forma adjustments are appropriate for the
purposes of the unaudited pro forma financial effects disclosed pursuant to the Listings Requirements of
the JSE Limited (“JSE”). The unaudited pro forma financial effects are presented in a manner consistent in
all respects with International Financial Reporting Standards (“IFRS”), with the SAICA Guide on Pro Forma
Financial Information and with the basis on which the historical financial information has been prepared in
terms of accounting policies of Purple Capital as at 28 February 2013.
Before the After the %
Transaction Transaction impact
Earnings per share (cents) 0.15 0.83 441
Headline earnings per share (cents) 0.15 0.83 441
Diluted earnings per share (cents) 0.15 0.79 441
Diluted headline earnings per share (cents) 0.15 0.79 441
Net asset value per share (cents) 33.58 34.69 3
Tangible net asset value per share (cents) 7.46 8.57 15
Number of shares in issue net of treasury shares (’000) 820 738 820 738 0
Diluted number of shares (’000) 858 557 858 557 0
Notes and assumptions in calculating the pro forma financial effects:
1. The financial information in the “Before the Transaction” column has been based on the unaudited interim financial
statements of Purple Capital for the six months ended 28 February 2013.
2. The effects on earnings, diluted earnings, headline earnings and diluted headline earnings per share are based on the
following assumptions:
a. The Transaction was effective on 1 September 2012.
b. Allocated costs of R1 223 189 would be retained by Purple Capital.
c. Settlement of the medium-term loan facility of R9 260 756, resulting in interest savings of R358 823 for the six
months, which saving is of a continuing nature. No taxation has been taken into account due to Purple Capital’s
assessed tax loss.
d. Settlement of the short-term facilities of R2 300 000, resulting in savings of R97 623, which saving is of a continuing
nature. No taxation has been taken into account due to Purple Capital’s assessed tax loss.
e. No interest income on surplus cash of R18 439 244 has been taken into account.
3. The effects on net asset value per share, tangible net asset value per share, diluted net asset value per share and diluted
tangible net asset value per share are based on the following assumptions:
a. The Transaction was effective 28 February 2013.
b. Total investment by Purple Capital comprised R20 833 638.
c. No capital gains tax has been taken into account due to Purple Capital’s assessed capital loss.
4. There are no post-balance sheet events which need adjustment to the pro forma financial information.
5. Transaction costs have not been taken into account as they are not material.
7. CATEGORISATION
In terms of the Listings Requirements, the Disposal is classified as a Category 2 transaction and does not
require shareholder approval.
8. FURTHER ANNOUNCEMENT
Shareholders will be notified once the last of the conditions precedent has been fulfilled.
Johannesburg
10 May 2013
Sponsor
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