Acquisition and cautionary announcement CSG HOLDINGS LIMITED (Formerly M&S Holdings Limited) (Incorporated in the Republic of South Africa) (Registration number: 2006/011359/06) Share code: CSG ISIN code: ZAE000184438 ("CSG" or "the Company") ACQUISITION OF A FURTHER 49% INTEREST IN SIGNIFICANT SITE SERVICES (PROPRIETARY) LIMITED (“SSS (SA)”) AND SIGNIFICANT SITE SERVICES MOZAMBIQUE LIMITADA (“SSS MOZAMBIQUE”) (COLLECTIVELY “THE ENTITIES”) AND CAUTIONARY ANNOUNCEMENT 1. Introduction Shareholders are advised that the Company has entered into a heads of agreement with Mr Danie Engelbrecht representing the sellers of the Entities, Messrs Danie Engelbrecht, Louis Jones, Cilliers De Kock, Chris Meyer and Paul Olivier (“Agreement”). In terms of the Agreement CSG Holdings will acquire a further 49% in each of SSS (SA) and SSS (Mozambique) (“Acquisition”). The CSG group currently holds an effective 41.28% in the Entities and following the Acquisition will hold an effective 90.28% in the Entities. Detailed terms of the Agreement will be recorded in further separate full agreements (“Full Agreements”). 2. Nature of business of SSS (SA) and SSS Mozambique The Entities construct and maintain remote site villages with the main activity being the management of these facilities. These facilities are currently located in Mozambique, Malawi, Zambia and South Africa. 3. Rationale for the Acquisition The Company has a comprehensive understanding of the Entities’ operations through its existing effective holding of 41.28% in each of the Entities and believes that the integration of a further 49% of the Entities would be seamless. Further, the Company believes that the management of the Entities has excellent capabilities and expertise. The advantage of the Entities is that currently in excess of 80% of revenue is earned in the Southern African countries of Mozambique, Malawi and Zambia. Margins in these remote areas are higher than margins obtained in the South African market. Investments in the mining industry and infrastructure development in the abovementioned countries are in the pipeline, and the directors are of the opinion that with their strong foothold in these countries, they are well positioned to secure further contracts. 4. Consideration for the Acquisition The aggregate purchase consideration for the Acquisition amounts to R61 238 433 being R48 288 583 for a further 49% interest in SSS (SA) and R12 949 850 for a further 49% interest in SSS Mozambique. The purchase consideration will be settled through a cash payment of R4 000 000 with the remainder to be settled by the issue of new CSG shares. The number of CSG shares to be issued will be determined based on the volume weighted average price of CSG shares traded on the exchange operated by JSE Limited 30 days prior to the date on which the Full Agreements are entered into. Shareholders will be advised in due course of the number of new CSG shares to be issued pursuant to the Acquisition. The new CSG shares will be issued ex any dividend declared by CSG for the 13 months ended 31 March 2014. 5. Conditions precedent The Acquisition is subject to inter alia: - CSG board approval; and - the audited annual financial statements of the Entities for the 13 months ended 31 March 2014 reflecting a profit after tax of at least R24.4 million. 6. Effective date The Acquisition will be effective following the fulfilment of the conditions precedent set out in paragraph 5 above. 7. Unaudited pro forma financial effects The unaudited pro forma financial effects of the Acquisition on CSG’s earnings per share, headline earnings per share, net asset value per share and net tangible asset value per share will be provided in a further announcement in due course. 8. Categorisation Based on current share price information, the Acquisition is a Category 2 transaction in terms of the JSE Limited Listings Requirements (“Listings Requirements”). Shareholders will be informed of the final categorisation once the Full Agreements have been entered into. 9. Memorandum of incorporation (“MOI”) Following the implementation of the Acquisition, the Entities will become subsidiaries of the Company. CSG will ensure that the provisions of the MOI of each of the Entities will not frustrate the Company in any way from compliance with the obligations of the Listings Requirements. 10. Cautionary announcement Shareholders are advised to exercise caution when trading in CSG securities until a further announcement regarding the unaudited pro forma financial effects of the Acquisition and further details of the Acquisition are published. Johannesburg 23 June 2014 Sasfin Capital (a division of Sasfin Bank Limited) Date: 23/06/2014 11:42:00 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.