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Acquisition of the farming enterprise known as High Noon Farm
CROOKES BROTHERS LIMITED
(INCORPORATED IN THE REPUBLIC OF SOUTH AFRICA)
(REGISTRATION NUMBER 1913/000290/06)
SHARE CODE: CKS ISIN: ZAE000001434
(“CROOKES” OR “THE COMPANY”)
ACQUISITION OF THE FARMING ENTERPRISE KNOWN AS HIGH NOON FARM
1. Introduction and terms
Shareholders are advised that an agreement has been concluded between CBL Agri
Services (Pty) Limited, a wholly-owned subsidiary of Crookes (“the Purchaser”), and
Ovenstone Farms (Pty) Limited (“the Seller”), for the acquisition of the farming enterprise
known as High Noon Farm in the Villiersdorp area of the Western Cape, inclusive of the
properties, the biological assets, the movables and the shares as a going concern (“High
Noon Farm”), for a purchase consideration of R103 million payable in cash on registration
of transfer of the properties into the Purchaser’s name (“the consideration”) (“the
acquisition”).
The effective date will be the date of registration of transfer of the High Noon Farm into
the Purchaser’s name.
2. Description of High Noon Farm
The High Noon Farm properties comprise the following:
- Farm Klein Tafelberg No. 524, in the Theewaterskloof Municipality, in the division of
Worcester, Western Cape Province
In extent 319,1662 (three hundred and nineteen comma one six six two) hectares;
- Remainder of Portion 4 of the Farm Elands Kloof No. 5, in the Theewaterskloof Municipality,
in the division of Caledon, Western Cape Province
In extent 828,9646 (eight hundred and twenty eight comma nine six four six) hectares;
- Portion 17 (a Portion of Portion 4) of the Farm Elands Kloof No. 5, in the Theewaterskloof
Municipality, in the division of Caledon, Western Cape Province
In extent 138,4433 (one hundred and thirty eight comma four four three three) hectares;
- Portion 7 (a Portion of Portion 5) of the Farm Elands Kloof No. 5, in the Theewaterskloof
Municipality, in the division of Caledon, Western Cape Province
In extent 66,7506 (sixty six comma seven five nought six) hectares; and
- Portion 2 (Sterfontein) of the Farm Elands Kloof No. 5, in the Theewaterskloof Municipality,
in the division of Caledon, Western Cape Province
In extent 462,3845 (four hundred and sixty two comma three eight four five) hectares
The High Noon Farm is being acquired free of all liabilities.
3. Rationale for the acquisition
The High Noon farm has 180 hectares planted to deciduous fruit, with a further 60 hectares
available for planting, and will be integrated into Crookes’ existing Western Cape deciduous
fruit operation. The farm is located on the Elands River in the Kaaimansgat Valley, considered
to be a prime deciduous producing area due to its unique micro climate and high-potential
soils. The acquisition will increase the area under deciduous fruit owned by Crookes to more
than 600 hectares, enabling the Company to take advantage of resultant economies of scale.
4. Suspensive conditions
The acquisition is subject to conditions that are considered normal for transactions of this
nature, of which the following remain outstanding:
- regulatory approval, where necessary; and
- the registration of transfer of the properties.
5. Warranties
The acquisition is subject to warranties that are considered normal for transactions of this nature.
6. Financial effects
The unaudited pro forma financial effects of the acquisition are set out below. These unaudited
pro forma financial effects have been prepared for illustrative purposes only to provide
information on how the acquisition may have impacted on the results and financial position of
Crookes. Preparation of the unaudited pro forma financial effects is the responsibility of the
directors. Because of their nature, the unaudited pro forma financial effects may not fairly present
Crookes’s financial position after the acquisition or the effects on future earnings.
Pro forma financial effects of the Before the After the
acquisition on the Crookes published acquisition acquisition Change
unaudited interim results for the 6 months
ended 30 September 2013. 6 months Pro Forma
ended
30 Sept 2013
Earnings per share (cents) 375.2 381.3 1.6%
Headline earnings per share (cents) 372.5 378.6 1.6%
Net asset value per share (cents) 5013 5013 -
Net tangible asset value per share (cents) 5013 5013 -
Number of shares in issue 12 546 817 12 546 817 -
Weighted average number of -
12 452 424 12 452 424
shares in issue
Assumptions and Notes:
1. These unaudited pro forma figures, as shown in the table above, illustrate the possible
financial effects for the 6 months ended 30 September 2013 if the acquisition had been made
on 1 April 2013, having been financed largely from existing cash, near-cash and other easily
convertible financial reserves.
2. We caution readers that a major portion of the annual revenue of this crop is received
in the second half of the financial year and that this may result in the pro forma
financial effect of the acquisition on the interim earnings, as presented above, being
an unreliable indicator of the earnings potential for the financial year to 31 March 2014
and for future years.
3. For the reason provided above we have elected to include a second set of pro forma
financial information relating to the effects of the acquisition. Below is a table setting
out the unaudited pro forma effects on the published annual financial accounts for the
year ended 31 March 2013.
4. The unaudited pro forma figures, shown in the table directly below, illustrate the
possible financial effects for the year ended 31 March 2013 if the acquisition had been
made on 1 April 2012, having been financed largely from existing cash, near-cash and
other easily convertible financial reserves.
Pro forma financial effects on the final Before the After the
results for the year ended 31 March 2013. acquisition acquisition Change
12 months Pro Forma
ended
Notes 31 Mar 2013
Earnings per share (cents) 757.1 789.2 4.2%
Headline earnings per share (cents) 749.9 782.0 4.3%
Net asset value per share (cents) 4701 4701 -
Net tangible asset value per share (cents) 4701 4701 -
Number of shares in issue 12 385 000 12 385 000 -
Weighted average number of -
12 385 000 12 385 000
shares in issue
7. Categorisation of the acquisition
The acquisition is categorised as a Category 2 transaction in terms of the Listings Requirements
of the JSE Limited and is therefore not subject to shareholder approval.
Renishaw
23 December 2013
Corporate Advisor and Sponsor: Sasfin Capital
A division of Sasfin Bank Limited
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