GLOBAL ASSET MANAGEMENT LTD - Detailed Cautionary relating to Offer to Subscribe for Shares To Acquire 30% in Linde Financial Services (Pty) Ltd

Detailed Cautionary relating to Offer to Subscribe for Shares To Acquire 30% in Linde Financial Services (Pty) Ltd

GLOBAL ASSET MANAGEMENT LIMITED
(Incorporated in the Republic of South Africa)
(Registration number: 2002/003192/06)
Share Code: GAM   ISIN: ZAE000173498
("GLOBAL " or “the company”)


DETAILED CAUTIONARY ANNOUNCEMENT RELATING TO AN OFFER TO
SUBSCRIBE FOR NEW ORDINARY SHARES TO ACQUIRE 30% IN LINDE
FINANCIAL SERVICES PROPRIETARY LIMITED (“LFS”) AND AN
ADDITIONAL CAUTIONARY ANNOUNCEMENT


INTRODUCTION

The board of directors of Global is pleased to advise that
LFS, a wholly owned subsidiary of Global, has received an
offer from a BEE investor, to acquire a 30% interest in LFS
by way of a subscription for new shares in LFS for a
consideration of R22 million in cash (the “transaction”).

The offer has been accepted by LFS on 08 July 2013, subject
to certain conditions precedent clauses as indicated below,
for conclusion within a 21 day period.

The transaction will be tantamount to a disposal by Global
and the proceeds from the transaction will be applied to
capitalise the business of LFSin support of the expansion
of its business.

The transaction will be categorised as a Category 2
transaction in accordance with the JSE Listings
Requirements for companies listed on the Alternative
Exchange and accordingly will not require shareholder
approval.

RATIONALE FOR THE TRANSACTION

The rationale for the transaction is to provide LFS with a
value adding Black Economic Empowerment partner in order to
enhance the BEE credential of LFS, assist with accelerating
the growth of LFS in South Africa by accessing
opportunities that LFS would not otherwise have had.
Pursuant to the successful implementation of this
transaction, LFS will appoint two additional directors to
the board of LFS and expects that these appointments will
further enhance the South African business opportunities
for LFS.

CONDITIONS PRECEDENT

The transaction is subject to the following conditions
precedent:

1.   Completion of a due diligence by 12 July 2013;
2.   Final approval of funding for the subscription price on
     terms acceptable to the BEE investor by 18 July 2013;
3.   The conclusion of the funding agreement, a subscription
     agreement and a shareholder agreement (or amendment to
     the Memorandum of Incorporation of LFS) to provide for
     standard minority protection;
4.   The conclusion of a 24 month put option agreement,
     allowing the BEE investor to sell its shares back to LFS
     at the subscription price, exercisable after 12 months,
     with a notice period of 6 months. The put value is to
     be adjusted at the prime interest rate to date of
     exercise from the effective date of the transaction.
5.   Any regulatory approvals as well as any specific
     consents required from South African LFS stakeholders.

WARRANTIES

The subscription price for the transaction is based on a
warranted tangible net asset value (excluding inter alia
deferred tax assets and liabilities, goodwill and
intangibles) of R88 million at the effective date.

Other normal warranties for a transaction of this nature
will be provided.

EXCLUSIVITY

LFS has provided the BEE investor with an exclusivity
period in order to implement the transaction and has agreed
to keep their identity confidential until such time as
formal agreements have been signed.

PRO FORMA FINANCIAL EFFECTS

Pro forma financial effects will be provided once the due
diligence is completed and the legal agreements to give
effect to the transaction have been signed.

CAUTIONARY ANNOUNCEMENT

Shareholders are advised to exercise caution in dealing in
their securities until an announcement is made regarding
the conclusion of the various conditions precedent as well
as pro forma financial effects.

ADDITIONAL CAUTIONARY ANNOUNCEMENT

Shareholders are advised that the company is also involved
in further negotiations that may affect the price at which
the Company’s securities trade and are accordingly advised
to exercise caution until a further announcement is made.

Johannesburg
11 July 2013

Designated Advisor
Arcay Moela Sponsors Proprietary Limited
(Registration number 2006/033725/07)

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