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MICROMEGA HOLDINGS LIMITED - Agreement With Aurora University Proprietary Limited

Release Date: 02/10/2014 15:39
Code(s): MMG     PDF:  
Wrap Text
Agreement With Aurora University Proprietary Limited

MICROmega Holdings Limited
Incorporated in the Republic of South Africa
(Registration number 1998/003821/06)
Share code: MMG ISIN: ZAE000034435
(“MICROmega”)


AGREEMENT WITH AURORA UNIVERSITY PROPRIETARY LIMITED


INTRODUCTION

Shareholders are advised that MICROmega has entered into an agreement with Aurora University
Proprietary Limited (“Aurora") to provide R6 million to Aurora by way of an interest free loan to part-fund
Aurora's expansion of its associated Cornerstone Institute (“Cornerstone”) (“the Transaction”). The loan is
repayable on 1 August 2015 and MICROmega holds a 100% shareholding in Aurora as security until
payment has been made in full. Additionally, MICROmega has the option at any time prior to 1 August 2015
to acquire a 50.1% controlling interest in Aurora for a nominal value of R50.16 while simultaneously
extending the loan to an indefinite payment shareholder loan.

RATIONALE FOR THE TRANSACTION

Cornerstone was registered in 2001 as a private higher education institution offering its own accredited
degree, diploma and certificate programs. Cornerstone has historically operated as a niche provider of
degrees, diplomas and certificates through its main state-of-the-art campus in Cape Town and its numerous
community learning centres throughout the country. Cornerstone now wishes to expand its range of offerings
to students and to expand its footprint in South Africa.

MICROmega has approximately 40 000 students who annually attend its SETA accredited short course
certificate programs throughout our 26 training centres in South Africa. MICROmega also wants to expand
and diversify its training products and programs and Cornerstone provides a unique opportunity to do this.
Accordingly, the Transaction was structured to provide both parties with the opportunity to work together over
the coming year to meet our common objectives. If this joint approach is successful then MICROmega will
acquire a controlling interest in Aurora and, if not, MICROmega’s loan will be repaid in full. Effectively the
interest-free component of the loan is the cost to MICROmega of the opportunity to explore this business
opportunity prior to making a final decision.

CLASSIFICATION OF THE TRANSACTION

The Transaction, due to its size, falls below the threshold of a categorised transaction in terms of the Listings
Requirements of the JSE Limited and its announcement is therefore voluntary. The board of directors of
MICROmega however deemed it appropriate to advise shareholders of this strategic Transaction.


Johannesburg
2 October 2014

Sponsor
Merchantec Capital

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