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Joint Announcement of a Firm Intention by MB Tech to Acquire the Entire Issued Share Capital of SecureData
SECUREDATA HOLDINGS LIMITED MB TECHNOLOGIES INVESTMENTS
Incorporated in the Republic of South Africa PROPRIETARY LIMITED
(Registration number 1998/010017/06) Incorporated in the Republic of South Africa
Share code: SDH ISIN: ZAE000096368 (Registration number 2007/012226/07)
(“SecureData”) (“MB Tech”)
JOINT ANNOUNCEMENT OF A FIRM INTENTION BY MB TECH TO ACQUIRE THE ENTIRE ISSUED
SHARE CAPITAL OF SECUREDATA (“FIRM INTENTION ANNOUNCEMENT”) AND WITHDRAWAL
OF CAUTIONARY ANNOUNCEMENT
1. INTRODUCTION
The respective boards of directors of SecureData (“SecureData Board”) and MB Tech, a wholly-owned
subsidiary of MB Technologies Proprietary Limited are pleased to announce that MB Tech has made an
offer (“Offer”) to acquire the entire issued ordinary share capital of SecureData excluding treasury shares
(“Proposed Transaction”), being 227 128 521 (two hundred and twenty seven million one hundred and
twenty eight thousand five hundred and twenty one) SecureData Shares (“SecureData Shares”), by way
of a scheme of arrangement (“Scheme”), to be proposed by the SecureData Board between SecureData
and the holders of the SecureData Shares (“SecureData Shareholders”), in terms of section 114(1)(c) of
the Companies Act, No 71 of 2008, as amended (“the Companies Act”).
SecureData and MB Tech entered into a written implementation agreement on 19 November 2013
(“Implementation Agreement”) in relation to the Offer, which agreement contains, inter alia, provisions
relating to the implementation of the Offer and certain undertakings given by SecureData (including
undertakings regarding the conduct of the SecureData business in the period between the signature of
the Implementation Agreement and the implementation of the Scheme).
The terms of the Offer provide for the payment to each SecureData Shareholder (“Scheme
Participants”), if the Scheme becomes unconditional and is implemented, an amount of 38 cents in cash
for each SecureData Share held by such Scheme Participant on the Scheme consideration record date
(“Consideration”).
2. RATIONALE FOR THE SCHEME
MB Technologies Proprietary Limited, the sole shareholder of MB Tech, is one of the largest unlisted IT
organisations in South Africa. Established over 26 years ago, it has grown into one of the leading
distributors of Information and Communication Technology products and services, offering hardware and
software products throughout Southern Africa. The company also provides complementary value-added
IT services including, inter alia, logistics solutions incentive schemes, training programmes, financing
solutions and focused product management strategies.
The implementation of the Proposed Transaction, which will add significantly to the products, services,
client base and skills set within the combined businesses, is expected to build scale to both businesses
which would benefit from synergies and cost savings resulting in a more efficient organisation with
increased diversification.
In addition, MB Tech firmly believes that opportunities exist to cross-sell products and services to the
respective companyies’ client base, and to provide improved services to mutual clients. MB Tech
recognises the strengths of SecureData in its chosen fields and wishes to work collaboratively with its
existing management team to leverage off their experience, skill set and networks.
Furthermore, the implementation of the Scheme will result in the termination of the listing of SecureData
Shares as set out in paragraph 7 below and accordingly, the Offer will provide SecureData Shareholders
with a cash exit opportunity.
3. CONDITIONS TO THE POSTING OF THE CIRCULAR
The posting of the circular in respect of the Scheme (“Scheme Circular”) will be subject to the fulfilment
or waiver (in whole or in part by MB Tech) of the following conditions –
3.1. the “Independent Expert”, being an independent advisor acceptable to the Takeover Regulation
Panel (established in accordance with section 196 of the Companies Act) (“the Panel”) confirming
in writing to the independent board of SecureData (“SecureData Independent Board”) and the
SecureData Shareholders that the Consideration in respect of the Scheme is fair to SecureData
Shareholders;
3.2. the SecureData Independent Board recommending to the SecureData Shareholders that they vote
in favour of the Scheme; and
3.3 the requisite approvals being received from the JSE Limited (“JSE”) and the Panel for the posting
of the Circular.
4. CONDITIONS TO THE SCHEME BECOMING OPERATIVE
The implementation of the Scheme will be subject to the fulfilment or waiver of the following conditions by
not later than the date which is 120 (one hundred and twenty) days after the date of publication of this
Firm Intention Announcement (which period may be extended by MB Tech by not more than 30 (thirty)
days) –
4.1 no distributions (as such term is defined in the Companies Act) having been declared and paid by
SecureData to the SecureData Shareholders, nor any increases in the share capital of SecureData
nor amendments to the shares or share capital of SecureData having been effected;
4.2 the agreements entered into between SensePost Newco Limited and SecureData for the disposal
of 100% of the issued share capital of SensePost Proprietary Limited, as set out in the
announcement released on SENS on 1 November 2013, having become unconditional and have
been implemented in accordance with their terms;
4.3 each of Miles Crisp and Carlo Venter having entered into and signed a service contract with MB
Tech on terms and conditions and in the form and substance acceptable to MB Tech (as confirmed
by MB Tech by written notice to SecureData);
4.4 each of Wayne Olsen, Martin Britz and Ivor Daniels remaining in the employ of SecureData on the
same terms and conditions of their current service contracts with SecureData;
4.5 the special resolution necessary to approve the Scheme having been proposed at the meeting of
SecureData Shareholders required to consider and approve the Scheme (“General Meeting”) and
having been adopted by a majority representing not less than 75% (seventy five percent) of the
votes exercised by SecureData Shareholders present and entitled to vote on such resolution, either
in person or by proxy;
4.6 the special resolution necessary to approve the Scheme not having been opposed by 15% (fifteen
percent) or more of the voting rights exercised on such resolution, or, should the resolution have
been opposed by 15% (fifteen percent) or more of the voting rights exercised on it, no person who
voted against the special resolution requiring SecureData to seek court approval in terms of section
115(3) of the Companies Act. This condition may be waived by MB Tech;
4.7 if the special resolution necessary to approve the Scheme having been opposed by 15% (fifteen
percent) or more of the voting rights exercised on such resolution, and a person who voted against
the special resolution requires SecureData to seek court approval and MB Tech waives the
condition precedent set out in paragraph 4.6 above, and SecureData does not elect to treat the
special resolution as a nullity in terms of section 115(5) of the Companies Act, the court having
approved the special resolution in terms of section 115(3) of the Companies Act;
4.8 no leave to review the Proposed Transaction being granted by the court, on an application within
10 (ten) business days after the vote, to any person who voted against the special resolution and
who applied to the court for a review of the Scheme in terms of section 115(7) of the Companies
Act. This condition may be waived by MB Tech on condition that the court approves the special
resolution in terms of section 115(3) of the Companies Act;
4.9 within the period prescribed under section 164(7) of the Companies Act, no valid demands having
been received by SecureData in terms of such section in respect of SecureData Shares
representing, in aggregate, more than 5% (five percent) of the total issued share capital of
SecureData. This condition may be waived by MB Tech on written notice to the SecureData
Independent Board to that effect;
4.10 by the date upon which all conditions to the Scheme, other than the condition in this clause 4.10
are fulfilled or waived, as the case may be, no adverse effect, fact, circumstance or any potential
adverse effect, fact or circumstance having arisen or occurred, or might reasonably be expected to
arise or occur and which is or might reasonably be expected (alone or together with any other such
actual or potential adverse effect, fact or circumstance) to be material with regard to the operations,
continued existence, business, condition, assets and liabilities of SecureData and its subsidiaries
(whether as a consequence of the Proposed Transaction or not) and/or any restrictive covenant or
covenants or similar provision entered into by SecureData or any of its subsidiaries which may
materially reduce the operating performance of SecureData. For the purposes of this clause 4.10,
to be material, the adverse effect, fact or circumstance must -
4.10.1 have (or be reasonably expected to have) an adverse effect upon SecureData's annual
profit after tax as determined by MB Tech in its sole discretion; or have an adverse effect
upon any other financial or non-financial measure that MB Tech in its sole discretion
deems appropriate;
4.10.2 constitute a change in the laws of South Africa (including, without limitation, laws relating
to taxation) which has (or may reasonably be expected to have) a material adverse effect
upon the Scheme such that the effective direct or indirect cost of the Scheme increases
by 15% (fifteen percent) or more; or
4.10.3 consist of a fall in the JSE All Share Index of 15% (fifteen percent) or more compared with
such index as at the last trading day of the date when the Offer is made; and
4.11 all regulatory approvals and consents necessary in respect of the Proposed Transaction, including,
but not limited to, approvals and consents from the JSE, the Panel, the South African competition
authorities and the Financial Surveillance Department of the South African Reserve Bank, having
been received.
5. SHAREHOLDER UNDERTAKINGS
To date, irrevocable undertakings to vote in favour of the Scheme and any other resolutions to be
proposed at the General Meeting have been received from certain SecureData Shareholders holding in
aggregate 183 065 850 (one hundred and eighty three million sixty five thousand eight hundred and fifty)
SecureData Shares, representing in aggregate 80.6% of the SecureData Shares eligible for voting (which
shares exclude those held as treasury shares) at the General Meeting, or any adjournment thereof.
The following SecureData Shareholders have provided irrevocable undertakings to vote the stated
number of Scheme Shares in favour of the Scheme:
Party Date of irrevocable Shares subject Percentage
undertaking to undertaking holding (%)
36ONE Asset Management Proprietary
Limited 15 November 2013 40 975 101 18.0
Treacle Investments Proprietary Limited 15 November 2013 40 413 304 17.8
Rhys Summerton 14 November 2013 38 127 881 16.8
Treacle Fund II Trust 15 November 2013 31 746 145 14.0
Golden Hind Partnership 14 November 2013 14 882 244 6.6
Palmbrooke Investments Proprietary
Limited 15 November 2013 13 236 112 5.8
Mazi Visio Market Neutral Fund 14 November 2013 1 697 850 0.7
MI Trust 14 November 2013 1 336 973 0.6
Blue Ink Vesting Trust No. 5 14 November 2013 650 000 0.3
183 065 610 80.6
6. GUARANTEES AND CONFIRMATIONS TO THE PANEL
MB Tech has delivered an irrevocable and unconditional bank guarantee from Investec Bank Limited for
an amount of R90 000 000 (ninety million Rand) to the Panel in compliance with regulations 111(4) and
111(5) of the Takeover Regulations, being the regulations published in terms of section 120 of the
Companies Act (“Takeover Regulations”), which amount is in excess of and sufficient for the purpose of
fully satisfying the Consideration that will become payable in respect of all Scheme Shares, being an
amount of R86 308 838 (eighty six million three hundred and eight thousand eight hundred and thirty
eight Rand).
7. TERMINATION OF THE SECUREDATA LISTING
Following the implementation of the Scheme, application will be made to the JSE to terminate the listing
of the SecureData Shares on the JSE.
8. ACTING AS PRINCIPAL AND BENEFICIAL INTERESTS OF MB TECH IN SECUREDATA
SHARES
MB Tech confirms that it will be the ultimate purchaser of all SecureData Shares and that it is acting and
will act alone and not in concert with, or as agent or broker for, any other party. MB Tech and its directors
currently do not hold or control any beneficial interest in SecureData Shares, or options to acquire any
SecureData Shares.
9. RECOMMENDATION AND FAIRNESS OPINION
The SecureData Independent Board has appointed Nodus Capital Proprietary Limited as the Independent
Expert to provide it with external advice in relation to the Scheme and to make appropriate
recommendations to the SecureData Independent Board in the form of a report contemplated in section
114(3) of the Companies Act.
The SecureData Independent Board intends, based on the information currently available to it, to make a
recommendation to SecureData Shareholders to vote in favour of the resolutions to be proposed at the
General Meeting, provided that the SecureData Independent Board receives an opinion from the
Independent Expert to the effect that the Consideration is fair to SecureData Shareholders.
The substance of the external advice received from the Independent Expert and the views of the
SecureData Independent Board will be detailed in the Scheme Circular.
10. DOCUMENTATION
Details of the Scheme will be included in the Scheme Circular, which will contain, inter alia, the terms of
the Scheme, a notice convening the General Meeting, a form of proxy in connection with the General
Meeting, and a form of acceptance, surrender and transfer in respect of the SecureData Shares. The
Scheme Circular is expected to be posted to SecureData Shareholders on or about 19 December 2013 in
accordance with the parties’ obligations in terms of the Takeover Regulations.
The salient dates pertaining to the Scheme will be released on SENS and published in the press prior to
the posting of the aforementioned Scheme Circular.
11. SECUREDATA RESPONSIBILITY STATEMENT
The SecureData Independent Board individually and collectively accepts full responsibility for the
accuracy of the information contained in this Firm Intention Announcement to the extent that it relates to
SecureData. In addition, the SecureData Independent Board certifies that, to the best of its knowledge
and belief, the information contained in this Firm Intention Announcement pertaining to SecureData is true
and, where appropriate, does not omit anything that is likely to affect the importance of the information
contained in this Firm Intention Announcement pertaining to SecureData.
12. MB TECH RESPONSIBILITY STATEMENT
The board of directors of MB Tech, individually and collectively accepts full responsibility for the accuracy
of the information contained in this Firm Intention Announcement to the extent that it relates to MB Tech.
In addition, the board of directors of MB Tech certifies that, to the best of its knowledge and belief, the
information contained in this Firm Intention Announcement pertaining to MB Tech is true and, where
appropriate, does not omit anything that is likely to affect the importance of the information contained in
this Firm Intention Announcement pertaining to MB Tech.
13. WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT
Following the release of this Firm Intention Announcement, the cautionary announcement dated
7 August 2013, and the subsequent renewal of cautionary announcements, the last of which was dated 1
November 2013, are hereby withdrawn and caution is no longer required to be exercised by SecureData
Shareholders when dealing in SecureData Shares.
Johannesburg
20 November 2013
Corporate Advisor and Sponsor to SecureData
Merchantec Capital
Legal Advisor to SecureData
A B Scarrott Attorneys
Independent Expert
Nodus Capital Proprietary Limited
Corporate Advisor to MB Tech
Investec Corporate Finance
Legal Advisor to MB Tech
Cliffe Dekker Hofmeyr Inc
Date: 20/11/2013 03:30:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
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