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Specific Issue Of Shares To Kagiso Capital
ONELOGIX GROUP LIMITED
Incorporated in the Republic of South Africa
(Registration number 1998/004519/06)
JSE share code: OLG ISIN: ZAE000026399
(“OneLogix” or “the Company”)
SPECIFIC ISSUE OF SHARES TO KAGISO CAPITAL
1. INTRODUCTION
Shareholders of the Company (“Shareholders”) are advised that OneLogix has entered into a
subscription agreement with Kagiso Capital Proprietary Limited (“Kagiso Capital”), a wholly-owned
subsidiary of the Kagiso Charitable Trust (“KCT”), on 2 December 2014 in terms of which Kagiso
Capital will subscribe for, and the Company will issue, 28 086 585 OneLogix ordinary shares, at a
subscription price of R3.60 per share (“Subscription Price”) for an aggregate amount of
R101 111 706 (“the Specific Issue”).
KCT, the parent entity of Kagiso Capital, is a charitable trust which, for over 29 years, has worked with
South Africans to achieve a society which offers liberty, justice and freedom from poverty. KCT is one
of the oldest black-led organisations in South Africa and is a respected and trusted Non-Government
Organisation with a gross asset value of approximately R6.5 billion.
2. RATIONALE
During December 2013, at the election of OneLogix’s then Black Economic Empowerment (“BEE”)
partner, Izingwe Holdings Proprietary Limited (“Izingwe”), the Company repurchased all of the
OneLogix shares held by Izingwe who wished, eight years after the successful conclusion of the BEE
transaction effected in 2005, to realise its investment. The repurchased shares represented 10.25% of
the issued share capital of OneLogix.
As a result of Izingwe’s exit as a major contributor, the ‘ownership’ element of OneLogix’s BEE
scorecard (“Scorecard”) has been negatively affected. The effect is further amplified by the
introduction of priority elements in the revised Codes of Good Practice of Broad-Based Black
Economic Empowerment recently promulgated by the Department of Trade and Industry (“New BEE
Codes”), with one such priority element being ‘ownership’.
In order to restore and improve the ‘ownership’ element of the Company’s Scorecard, and in
conjunction with the issue of 24 917 929 OneLogix ordinary shares to Chute Investments Proprietary
Limited (“EmployeeCo”) for which the Company obtained approval at the general meeting of
Shareholders on 28 November 2014 (“EmployeeCo Shares”), the Specific Issue will, along with a
continuing benefit recognised from the previous BEE ownership structures, enable OneLogix to have
a meaningful Broad-Based BEE (“B-BBEE”) ownership structure in place in compliance with the New
BEE Codes.
Furthermore, notwithstanding the funding challenges presented in ‘ownership’ transformation, the
board of directors of OneLogix (“Board”) has recognised the importance of the ongoing need to
improve BEE and comply with the New BEE Codes, transforming the Company into an establishment
which recognises its social responsibility as a committed South African corporate citizen. In this
respect, Kagiso Capital represents the ideal strategic BEE partner for OneLogix, with the ability to
fund the Specific Issue without requiring funding facilitation from the Company.
In terms of KCT’s latest Scorecard, KCT is 100% black-owned, 48% owned by black women and is
accredited with a ‘Level 3’ B-BBEE status. Accordingly, the demographic and composition of KCT is
likely to result in a significant increase in the B-BBEE ownership of the Company.
The indicative impact of the Specific Issue, together with the issue of the EmployeeCo Shares, on the
BEE ownership points is an increase from 9.14 to 21.87, based on an approximate aggregate 19%
BEE ownership in OneLogix between EmployeeCo and Kagiso Capital.
Shareholders are advised that increasing OneLogix’s direct BEE ownership remains a strategic
imperative for the Company. BEE is a prerequisite for sustainable growth in South Africa, and as a
result the Board believes that the Specific Issue will be beneficial to all Shareholders.
3. INTENDED USE OF FUNDS
The Company will use the proceeds of the Specific Issue to fund growth through business
acquisitions and further investments in properties.
4. SUSPENSIVE CONDITION AND EFFECTIVE DATE
The Specific Issue is subject to the fulfilment or waiver on or before 28 February 2015, or such other
date as OneLogix and Kagiso Capital may agree in writing, of the following suspensive condition:
- the passing of any resolutions required to approve the Specific Issue by the Shareholders and
Board, including, without limitation, the approval of the Specific Issue in terms of the Listings
Requirements of the JSE.
The effective date of the Specific Issue shall be the first business day following the date on which the
suspensive condition is fulfilled.
5. CIRCULAR AND GENERAL MEETING
A circular containing, inter alia, full details of the Specific Issue will be posted to Shareholders in due
course. The circular will contain a notice of general meeting of Shareholders to vote on the Specific
Issue.
Johannesburg
2 December 2014
Transaction Sponsor to OneLogix:
Merchantec Capital
Legal Advisor to OneLogix:
Webber Wentzel
Investment Bank and Corporate Adviser to KCT and Kagiso Capital
Nedbank Capital, a division of Nedbank Limited
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