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Declaration and finalisation announcement in relation to the Odd-Lot offer and confirmation of the offer price
Prescient Limited
Incorporated in the Republic of South Africa
Registration number: 1936/008278/06
Share Code: PCT ISIN: ZAE000163531
("Prescient" or "the Company")
DECLARATION AND FINALISATION ANNOUNCEMENT IN RELATION TO THE ODD-
LOT OFFER AND CONFIRMATION OF THE OFFER PRICE
1. Introduction
Shareholders are advised that the special resolutions pertaining to the Odd-lot Offer
approved at the Annual General Meeting of the Company, on 22 October 2013 have been
registered by the Companies and Intellectual Property Commission (“CIPC”).
2. Odd-lot Offer
2.1 Rationale for the Odd-lot Offer
2.1.1 The Odd-lot Offer is being implemented in order to reduce the future
substantial recurring administration costs that will be incurred in connection
with the large number of Odd-lot Holders of the Company.
2.1.2 The Company currently has 1,549 Shareholders (being 52% of the total
number of Shareholders) that hold less than 100 Ordinary Shares each.
These shareholders hold 31 891 Ordinary Shares in aggregate, which
constitutes approximately 0.002% of the total number of Ordinary Shares in
issue.
2.1.3 In terms of the Odd-lot Offer, each shareholder holding an aggregate
shareholding of less than 100 ordinary shares (“Odd-lot Holdings”) will be
offered the opportunity either to sell its shareholding (“Odd-lot Holding”) for
the offer consideration or retain its Odd-lot Holding.
2.2 Record Date
The record date for the Odd-lot Offer is the close of business on Friday, 7 February
2014 (“Record Date”). If a shareholder holds less than 100 Ordinary Shares on the
Record Date, such shareholder is an Odd-lot Holder and, as such, is entitled to take
part in the Odd-lot Offer. Shareholders will not be advised individually as to whether
they are entitled to take part in the Odd-lot Offer, and accordingly each shareholder
must determine this on their own. No further documentation will be sent to
shareholders in this regard.
2.3 Offer Consideration
The offer consideration will be a 5% premium to the volume weighted average price
for the ordinary shares of the Company on the JSE for the 5 (five) trading days prior
to Friday, 17 January 2014 (“Offer Consideration”), the declaration date of the Odd-
lot Offer.
2.4 Conditions Precedent
The implementation of the Odd-lot Offer is subject to the fulfilment of the condition
precedent that the ordinary and special resolutions contained in the Notice of 2013
Annual General Meeting are duly passed and that the special resolutions are
registered by CIPC.
2.5 Mechanism
2.5.1 The Odd-lot Offer will open for acceptance from 09:00 on Friday, 24 January
2014 and will close at 12:00 on Friday, 7 February 2014.
2.5.2 The Ordinary Shares of those Odd-lot Holders who do not make an election
or who choose the Offer Consideration will be repurchased by Prescient or
any wholly-owned subsidiary nominated by Prescient at the Offer
Consideration. Any such repurchase will be regarded as a specific
repurchase of Shares in terms of the Companies Act and the JSE Listings
Requirements.
2.5.3 Odd-lot Holders who do not make an election should note that their Ordinary
Shares will automatically be repurchased by Prescient or any wholly-owned
subsidiary nominated by Prescient, without any further action on their part
and without any further notice to them.
2.5.4 All shares repurchased in terms of the Odd-lot Offer will be repurchased by a
wholly owned subsidiary of the Company and will be held as treasury shares.
2.6 Financial effects
The repurchase of Ordinary Shares pursuant to the Odd-lot Offer will have no
significant effect on Prescient’s earnings per Ordinary Share, headline earnings per
Ordinary Share, net asset value per Ordinary Share or tangible net asset value per
Ordinary Share.
2.7 South African Taxation
The following is a general summary of the South African tax implications for Ordinary
Shares held by South African tax residents included in the Odd-lot Offer, for both
Shareholders of Prescient and Prescient. The following summary is only a guide and
should not be construed as formal advice. Any Shareholder who has any doubts as
to their tax position is encouraged to seek independent advice. The repurchase of
Ordinary Shares in terms of the Odd-lot Offer will be funded out of contributed tax
capital. Accordingly, where an Odd-lot Holder is exempt from paying income tax in
terms of the South African Income Tax Act, No.58 of 1962, as amended (‘Income Tax
Act’), for instance in the case of a pension, provident or retirement annuity fund, the
consideration received should not be subject to the Capital Gains Tax discussed
below. If the Ordinary Shares in question are held on capital account by the relevant
Shareholder, the sale and transfer of those Ordinary Shares by the holder will be
subject to Capital Gains Tax (“CGT”). In order to quantify the CGT that arises from
the disposal of the Odd-lot shares, the holder will need to identify the following:
? the proceeds arising from the disposal, which will be equal to the Offer
Consideration received for the Ordinary Shares sold as part of the Odd-lot
Offer; and
? the base cost of those Ordinary Shares, which in terms of the Income Tax Act
will constitute the expenditure actually incurred in respect of the cost of
acquiring the Ordinary Shares and allowable expenses.
In the event that the proceeds exceed the base cost, a capital gain will have been
realised which will be subject to CGT.
If it is established that there is a capital gain and it has been quantified, the holder will
then need to apply the relevant CGT rate to this amount to determine the tax due. For
companies the effective rate of CGT is 18.6%, and for trusts it is 26.7% (for years of
assessment commencing on or after 1 March 2012). The maximum effective rate of
CGT for natural persons is 13.3%. When determining its liability, a holder is allowed
to take into account any capital losses, arising from other transactions concluded in
the relevant tax year, if any, as well as any capital loss carried forward from a
previous tax year that may be taken into account in determining the actual tax liability
of the holder.
Additionally, in the event that the Ordinary Shares in question are held by an entity
that is trading in them (for instance as a share dealer) or holding them as part of a
profit-making scheme, the consideration should be included in the calculation of that
entities net profits/losses arising from such activities and instead of being subject to
CGT, should be subject to income tax.
The transfer of securities in Prescient will be subject to Securities Transfer Tax
(“STT”) at a rate of 0.25%. The STT will be payable by Prescient in respect of
Ordinary Shares.
3. Finalisation and salient dates and times
Shareholders are referred to the Notice of Annual General Meeting 2013, dated 20
September 2013, incorporating inter alia the terms of the Odd-lot offer and a form of election
(“the Circular”). Given that the Odd-lot Offer is now unconditional, Prescient will implement
the Odd-lot Offer in accordance with the detailed terms included in the Circular and the
abridged terms as detailed in this announcement on the following salient dates and times:
Declaration date Friday, 17 January 2014
Finalisation date and Odd-lot offer opens at 09:00 on Friday, 24 January 2014
Expected last day to trade in Prescient shares in order to be
Friday, 31 January 2014
eligible to participate in the Odd-lot offer
Shares trade "ex" the Odd-lot offer Monday, 3 February 2014
Forms of election and surrender for the Odd-lot offer to be
Friday, 7 February 2014
received by the transfer secretaries by 12:00 on
Odd-lot offer closes at 12:00 on Friday, 7 February 2014
Record date for the Odd-lot offer (to determine the shareholders
entitled to participate in the Odd-lot offer) at the close of Friday, 7 February 2014
business on
Odd-lot offer holders with dematerialised shares have their
accounts held at their CSDP or broker credited with the cash
Monday, 10 February 2014
amount, unless shareholders have elected to retain their Odd-
lot offer holding, on, as the case may be, on
Cheques and EFTs in respect of the sale of Odd-lot offer
holdings by Odd-lot offer holders with certificated shares
posted, at the risk of such Odd-lot offer holders, on or about Monday, 10 February 2014
Results of Odd-lot offer released on SENS Monday, 10 February 2014
Notes:
1. All times in this announcement are South African local times.
2. Shareholdings may not be dematerialised or rematerialised between Monday, 3 February 2014 and Friday, 7 February
2014 both dates inclusive.
3. Dematerialised Odd-lot offer holders are required to notify their duly appointed CSDP or broker of their election in the
manner stipulated in the agreement governing the relationship between the Odd-lot offer holder and his CSDP or
broker.
4. In the case of holders of certificated shares, who elect to sell their Odd-lot offer shares cheques and payments by
electronic funds will be transferred into the personal bank accounts of the respective certificated Odd-lot Offer
holders, where details are known, at the risk of such holders on or about Monday, 10 February 2014 or within five
business days after the receipt of such documents of title by the transfer secretaries, whichever is the later.
4. Determination of the Offer Consideration
The offer consideration is determined to be 88 cents per share, being a 5% premium to the
volume weighted average price of ordinary shares of the Company on the JSE Limited for
the 5 (five) trading days prior to Friday, 18 January 2014.
Cape Town
17 January 2014
Sponsor: Bridge Capital Advisors (Pty) Limited
Date: 17/01/2014 01:18:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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