Wrap Text
Issue of convertible debt instruments and cautionary announcement
POYNTING HOLDINGS LIMITED
Incorporated in the Republic of South Africa
(Registration number 1997/011142/06)
Share code: POY ISIN: ZAE000121299
(“Poynting” or “the Company”)
ISSUE OF CONVERTIBLE DEBT INSTRUMENTS AND CAUTIONARY
ANNOUNCEMENT
1. ISSUE OF CONVERTIBLE DEBT INSTRUMENTS
1.1. Shareholders of the Company (“Shareholders”) are
hereby referred to the announcement released on SENS
on 27 December 2013 where shareholders were advised
that PSG Private Equity Proprietary Limited (“PSG
Private Equity”) had subscribed for 16.9% of the
issued share capital of Company and the announcement
released on SENS on 30 December 2013 where
shareholders were notified that PSG Private Equity
Proprietary Limited (“PSG Private Equity”) had
increased its shareholding in the Company to 27.86%
(“the Transaction”).
1.2. Given that the Company required additional capital
to strengthen its cash resources in order to fund
its acquisition strategy and to fund working capital
going forward, and that PSG Private Equity required
a material shareholding in Poynting following the
finalisation of the Aucom acquisition in 2014, the
parties agreed on 19 December 2013 that PSG Private
Equity would subscribe for convertible debt
instruments in the Company. The Aucom acquisition,
when unconditional, will result in the issue of
66 million ordinary shares in the Company and will
dilute PSG Private Equity’s shareholding in Poynting
to below 20%. Accordingly, PSG Private Equity agreed
to subscribe for, and the Company agreed to issue,
convertible debt instruments, for a subscription
consideration of R51 000 000 (“Convertible Debt
Instruments”), convertible into ordinary shares of
the Company, subject to shareholder approval
(“Ordinary Shares”).
1.3. As the Company has received forms of proxy on the
circular sent to shareholders on 31 January 2014,
approving the acquisition of Aucom, of greater than
75% of the securities of the Company, the Company
and PSG Private Equity are currently finalising the
detail surrounding the convertible debt instrument.
Full and final details of which will be contained in
a further announcement and in a circular that will
be posted to shareholders in due course.
1.4. The salient terms of the Convertible Debt
Instruments, which have been agreed between the
parties, are, set out below:
1.4.1. PSG Private Equity shall be entitled to
convert the Convertible Debt Instruments
into Ordinary Shares (“Converted Ordinary
Shares”) at any time within a period of
three years from the date on which they are
issued;
1.4.2. in the event that PSG Private Equity elects
to convert the Convertible Debt Instruments
into Converted Ordinary Shares, each
Convertible Debt Instrument shall be
converted into Ordinary Shares at a
conversion price of R2.50 per Ordinary Share
(“Conversion Price”), representing a 58.2%
premium to the reference share price of
R1.58, at close of business on
19 December 2013;
1.4.3. the price at which the Convertible Debt
Instruments will be converted is at a
premium of 65.6% to the weighted average
traded price of Ordinary Shares measured
over thirty business days prior to
19 December 2013, of R1.51 per share;
1.4.4. based on the Conversion Price, the number of
Converted Ordinary Shares to be issued upon
the conversion of the Convertible Debt
Instruments will be 20 400 000 Ordinary
Shares, representing 11.6% of the number of
Ordinary Shares in issue (after assuming
successful implementation of the Aucom
transaction); and
1.4.5. the Convertible Debt Instruments will bear
interest at a market related interest rate,
which interest will be serviced on a monthly
basis.
1.5. In terms of paragraph 5.53(a)(i) and 5.51(g) of the
Listings Requirements of the JSE, the issue of the
Convertible Debt Instruments is considered to be a
specific issue of shares for cash and requires the
approval by way of an ordinary resolution (requiring
at least a 75% majority of the votes cast in favour
of such resolution) of all Shareholders present or
represented by proxy at the general meeting on which
any specific issue participants and their
associates, have not voted on, or whose votes have
not been counted in respect of such ordinary
resolution.
1.6. The Company has received irrevocable undertakings
from in excess of 70% of the Shareholders pursuant
to which, inter alia, such Shareholders have
irrevocably undertaken to vote in favour of any and
all resolutions required to issue the Convertible
Debt Instruments.
2. RATIONALE FOR ISSUE OF THE CONVERTIBLE DEBT INSTRUMENTS
The Company will use the net proceeds of the Convertible
Debt Instruments for the purpose of the Company’s
acquisition strategy and to fund working capital going
forward.
3. PSG PRIVATE EQUITY
3.1. PSG Private Equity is a 100% subsidiary of listed
PSG Group Limited (“PSG Group”).
3.2. PSG Group is an investment holding company
consisting of underlying investments that operate
across industries which include financial services,
banking, private equity, agriculture and education.
PSG Group’s market capitalisation is approximately
R16.7 billion, with its largest monetary investment
being a 28.3% interest in Capitec Bank Holdings
Limited. The companies in the group have a combined
market capitalisation of approximately R80 billion.
3.3. PSG Private Equity is a private equity investment
company that invests in a variety of sectors other
than food, agriculture and beverages.
4. PRO FORMA FINANCIAL EFFECTS
The pro forma financial effects in relation to the
Convertible Debt Instruments are in the process of being
finalised and will be published in due course.
5. CIRCULAR AND GENERAL MEETING
Once the convertible debt agreement has been finalised a
further announcement will be released on SENS and a
circular containing, inter alia, full details of the
Convertible Debt Instruments will be posted to
shareholders in due course. The circular will contain a
notice of general meeting of Shareholders to vote on the
Convertible Debt Instrument.
6. CAUTIONARY ANNOUNCEMENT
Shareholders are advised that as the convertible debt
agreement and the pro forma financial effects of the
Convertible Debt Instruments are still in the process of
being finalised, Shareholders are advised to exercise
caution when dealing in the Company’s securities until a
further announcement has been published on SENS.
12 February 2014
Johannesburg
Corporate Advisor to PSG Private Equity:
PSG Capital
Corporate and Designated Advisor to Poynting:
Merchantec Capital
Date: 12/02/2014 01:25:00 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.
Sharenet Sites 
