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Acquisition of Fintech and withdrawal of cautionary
SASFIN HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
(Registration Number 1987/002097/06)
Ordinary share code: SFN ISIN: ZAE000006565
Preference share code: SFNP ISIN: ZAE000060273
(“Sasfin Holdings” or “the Company”)
TERMS ANNOUNCEMENT RELATING TO THE ACQUISITION BY SASFIN BANK
LIMITED (“Sasfin”) OF THE ENTIRE ISSUED SHARE CAPITAL OF FINTECH
PROPRIETARY LIMITED (“Fintech”) AND WITHDRAWAL OF CAUTIONARY
ANNOUNCEMENT
1. INTRODUCTION
Shareholders of Sasfin Holdings (“Shareholders”) are hereby advised that Sasfin, a
wholly owned subsidiary of Sasfin Holdings, has entered into an agreement dated 27
November 2014 (“the Agreement”) with Fintech and the parties set out in paragraph
3 below (“the Sellers”), in terms of which Fintech will, subject to the fulfilment and/or
waiver (where appropriate) of the conditions precedent specified in the Agreement
and referred to in paragraph 6 below ("Conditions Precedent"), become a wholly
owned subsidiary of Sasfin ("Proposed Transaction").
2. SALIENT TERMS OF THE PROPOSED TRANSACTION
The salient terms of the Proposed Transaction are:
2.1. the effective date of the Proposed Transaction is 30 June 2014, notwithstanding
the date on which the Agreement was signed and the Closing Date of the
Proposed Transaction (as defined in the Agreement);
2.2. subject to paragraph 2.3 and 2.4 below, the consideration payable by Sasfin on
the Closing Date of the Proposed Transaction shall be an amount of
R156 260 810.00;
2.3. subject to the performance of Fintech and its subsidiaries (the "Fintech Group")
as evidenced by the consolidated audited financial statements of the Fintech
Group for the financial year ending on 30 June 2015 ("2015 Accounts"), the
consideration payable may be adjusted upwards in accordance with the formulae
set out in the Agreement, subject to paragraph 2.4, by a maximum amount of
R25 000 000.00 ("Top-Up Consideration");
2.4. the consideration referred to in paragraph 2.2 above is subject to nominal
increases of R32 171.00 for each day that the Closing Date of the Proposed
Transaction falls after 31 January 2015 and the Top-Up Consideration referred to
in paragraph 2.3 is subject to nominal increases of R4 514.00 for each day
commencing on 1 February 2015 until, inter alia, the 2015 Accounts are finalised
and payment of the Top-Up Consideration is made;
2.5. the consideration referred to in paragraph 2.2 above will be settled in cash (from
existing resources) on the Closing Date of the Proposed Transaction while the
Top-Up Consideration envisaged in paragraph 2.3 above will, if applicable, be
settled in cash after the 2015 Accounts are finalised; and
2.6. the Sellers have provided Sasfin with warranties customary for a transaction of
this nature, subject to customary limitations as to the period during which claims
may be brought and agreed thresholds for the capping of claims.
3. DETAILS OF THE SELLERS
3.1. The Sellers are Glen Christopulo, Fintech Syndicated Investments Proprietary
Limited, Barrett Jerling, Mike Luiz, Mirrett Proprietary Limited, Corvest 7
Proprietary Limited and Shalamuka Capital Proprietary Limited.
3.2. Glen Christopulo is the Chief Executive Officer of Fintech and will continue his
employment with Fintech post the implementation of the Proposed Transaction.
4. DESCRIPTION OF THE BUSINESS CARRIED ON BY THE FINTECH GROUP
Fintech provides various forms of rental finance in respect of equipment ranging from
light office automation to heavy manufacturing and construction plant and machinery
to more than 10 000 commercial and corporate customers .
5. RATIONALE FOR THE PROPOSED TRANSACTION
5.1. Sasfin is a mature player in the provision of rental, lease and instalment sale
agreement services particularly in the financing of office automation and industrial
equipment (“Rental Market”). Fintech also operates in this Rental Market.
5.2. The acquisition by Sasfin of Fintech will provide Sasfin with an opportunity to
strengthen its position in the Rental Market and deploy its capital more effectively.
5.3. The implementation of the Proposed Transaction will enhance Shareholder value
without in any way being prejudicial to the sustainability of the Sasfin Holdings
group.
6. CONDITIONS PRECEDENT
The Proposed Transaction is subject to the fulfilment and/or waiver (where
appropriate) of a number of conditions precedent, including the following:
6.1. the board of directors of Sasfin, Fintech, the Sellers (where applicable) and the
shareholders of each of the Sellers and Fintech (where applicable) have passed
all such resolutions as may be required to approve and implement the Proposed
Transaction;
6.2. Glen Christopulo has entered into a new service contract with Fintech;
6.3. the various third party consents required for implementing the Proposed
Transaction have been obtained;
6.4. Sasfin has concluded its due diligence investigation into the affairs of the Fintech
Group, and Sasfin is, or is deemed to be, satisfied with the results of its due
diligence investigation in accordance with the provisions of the Agreement;
6.5. the Proposed Transaction has been approved by the South African Reserve Bank
prior to the implementation of the Proposed Transaction; and
6.6. the Proposed Transaction has been approved by the Competition Authorities in
terms of the Competition Act, 89 of 1998.
7. MEMORANDUM OF INCORPORATION OF FINTECH (“MOI”)
Sasfin Holdings confirms that the MOI of Fintech does not restrict Sasfin Holdings in
any way from compliance with its obligations in terms of the JSE Limited (“JSE”)
Listings Requirements. Nothing contained in the MOI shall relieve Sasfin Holdings
from compliance with the JSE Listings Requirements.
8. PROFITS AND NET ASSET VALUE ATTRIBUTABLE TO THE SHARES WHICH
ARE THE SUBJECT OF THE PROPOSED TRANSACTION
The after tax profits attributable to the shares which are the subject of the Proposed
Transaction for the year ended 30 June 2014, being Fintech Group’s most recent
financial year end, is R33 650 391, while the net asset value as at 30 June 2014 is
R92 465 135.
9. CATEGORISATION OF THE PROPOSED TRANSACTION
The Proposed Transaction is classified as a category 2 transaction, as contemplated
in terms of section 9 of the JSE Listings Requirements.
10. WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT
Shareholders are referred to the cautionary announcement dated 15 October 2014
and are hereby advised that as the details of the Proposed Transaction as set out in
this announcement have been communicated to the market, Shareholders no longer
need to exercise caution when dealing in Sasfin Holdings’s securities.
Johannesburg
2 December 2014
Lead Sponsor
KPMG Services Proprietary Limited
Joint Sponsor
Sasfin Capital (a division of Sasfin Bank Limited)
Legal advisors to Sasfin
Edward Nathan Sonnenbergs Inc
Legal advisors to the Sellers
Cliffe Dekker Hofmeyr Inc
Date: 02/12/2014 03:23:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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