ALERT STEEL HOLDINGS LIMITED - Further announcement regarding the Specific issue of shares for cash to Cannistraro

Further announcement regarding the Specific issue of shares for cash to Cannistraro

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Alert Steel Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number: 2003/005144/06)
(Share Code: AET ISIN Code: ZAE000092847)
("Alert Steel" or "the Company")


Further announcement regarding the Specific issue of shares for cash to Cannistraro


Shareholders are referred to the further cautionary announcements dated 11 February 2013, 26
March 2013 and 11 April 2013 regarding inter alia the Specific issue of shares for cash.

1.        Specific issue for cash

1.1       It was previously announced that Alert Steel and Cannistraro Investments 282 (Pty) Ltd
          (“Cannistraro”) entered into an agreement in terms of which Alert Steel will undertake a
          Specific issue of 48 000 000 shares to Cannistraro at 200 cents per share for cash to
          raise R96 million (“the Specific Issue”). The said agreement was superceded and
          replaced by a new agreement entered into on 19 August 2013 between Alert Steel,
          Cannistraro, Southern Palace Investments 265 (Pty) Ltd (“Southern Palace”) and Alert
          Steel (Pty) Ltd.

1.2       In terms of this new agreement, Alert Steel will undertake a Specific issue of 48 000 000
          shares to Cannistraro at 200 cents per share for cash to raise R96 million, subject to inter
          alia the following conditions precedent on or before 31 December 2013:

      -   that shareholders of Alert Steel authorise the issue of shares in Alert Steel in terms of the
          Specific Issue which will comprise more than 30% of the shares in issue and will
          therefore require the approval of shareholders in terms of section 41(3) of the Companies
          Act, 2008;
      -   that shareholders of Alert Steel approve financial assistance regarding the subscription
          by Alert Steel for one share in Alert Steel (Pty) Ltd (“subscription share”) as well as the
          execution by Alert Steel (Pty) Ltd of a notarial bond over all stock and moveable assets
          held by Alert Steel (Pty) Ltd and a cession of debts, to Southern Palace, by a 75%
          majority vote;
      -   that the board of directors and shareholders of Southern Palace approve financial
          assistance by Southern Palace to Cannistraro, by a 75% majority vote;
      -   that shareholders of Alert Steel approve the Specific Issue by a 75% majority vote by all
          shareholders excluding Cannistraro and its associates; and
      -   the execution by Alert Steel of a guarantee in favour of Southern Palace.

          Subject to the fulfilment or waiver of the above conditions precedent, Alert Steel will
          subscribe for the subscription share in Alert Steel (Pty) Ltd.

1.3       Cannistraro will cede and delegate to Alert Steel all of its rights and obligations against
          Alert Steel (Pty) Ltd to discharge the aggregate subscription price as follows:

      -   R75 million will be set off against Alert Steel’s obligations to Cannistraro in terms of the
          loans which originated from Nedbank;
      -   R10 million arising from a prior loan from Cannistraro to Alert Steel (Pty) Ltd; and
                                                                                                  
      -   R11 million arising from an undertaking by Cannistraro to lend and advance Alert Steel
          (Pty) Ltd by 31 August 2013.

1.4       Pro forma financial effects of the Specific issue for cash:
          There have been no changes to the pro forma financial effects as announced on 11 April
          2013.
1.5       Circular

          A circular containing all the details of the Specific issue for cash and a notice of general
          meeting will be posted to shareholders in the middle of September 2013.

2.        Southern Palace loan

Shareholders are informed that on 19 August 2013, Southern Palace undertook to lend and
advance a further R20 million to Alert Steel (Pty) Ltd.


28 August 2013
Johannesburg


Designated Advisor
Exchange Sponsors

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