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Specific issues of shares for cash to various investors and related parties
TREMATON CAPITAL INVESTMENTS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number: 1997/008691/06)
JSE share code: TMT
ISIN: ZAE000013991
(“Trematon” or the “Company”)
SPECIFIC ISSUES OF SHARES FOR CASH TO VARIOUS INVESTORS AND RELATED
PARTIES AND AMENDMENT OF THE TREMATON SHARE INCENTIVE SCHEME
1. INTRODUCTION
1.1. Trematon shareholders (“Shareholders”) are advised that Trematon has entered into
various subscription agreements (“Subscription Agreements”) in terms of which the
Company will, subject to certain conditions precedent, including Shareholder approval,
issue an aggregate of 40 million shares (“Subscription Shares”), representing
approximately 22.5% of the Company’s issued ordinary share capital, for cash to various
parties at an issue price of R3.00 per Subscription Share (“Subscription Price”) on the
terms and conditions set out below, thereby raising capital of an aggregate amount of
R120 million (“Specific Issues”).
1.2. Shareholders are further advised that the Company wishes to amend the Trematon
Share Incentive Scheme in the manner contemplated in paragraph 4 below.
2. THE SPECIFIC ISSUES
2.1 TERMS OF THE SPECIFIC ISSUES
In terms of the Subscription Agreements it is proposed that the following Specific Issues be
effected:
2.1.1 The Specific Issues to various investors:
37 583 335 new Trematon ordinary shares at R3.00 per share to be issued to various investors
none of which are related parties to Trematon on the following basis (“Investor Issues”):
Name of Investor Number of Shares Rand Value of Shares
Michael Watters 166 667 500 001
Larry Sive 166 667 500 001
Nasbou (Pty) Ltd 166 667 500 001
Keith Getz 100 000 300 000
Igor Vukic 25 000 75 000
Clairwood Trust 150 000 450 000
Bacci Trading (Pty) Ltd 8 333 334 25 000 002
Sanlam Investment Management (Pty)
Ltd 5 500 000 16 500 000
Investec Asset Management (Pty) Ltd 9 500 000 28 500 000
Investec Wealth & Investment, a division
of Investec Securities (Pty) Ltd 5 000 000 15 000 000
Westbrook Capital Management Special
Opportunities En Commandite
Partnership 5 475 000 16 425 000
Credo Capital PLC 3 000 000 9 000 000
Total 37 583 335 112 750 005
2.1.2 The Specific Issues to various related parties
2 416 665 new Trematon ordinary shares at R3.00 per share to be issued to various related
parties on the following basis (“Related Party Issues”):
Name of Related Party Nature of relationship Number of Shares Rand Value of
Shares
Lemon Lane Nominees Associate of AM Louw,
CC director of Trematon 500 000 1 500 000
Associate of A Groll,
Armchair Trust director of Trematon 416 665 1 249 995
Major shareholder of
The Suikerbos Trust Trematon 1 500 000 4 500 000
Total 2 416 665 7 249 995
The Subscription Shares to be issued in terms of the Specific Issues will be Trematon ordinary
shares, which is a class of shares already in issue. The Subscription Shares will upon issue,
rank pari passu with the existing issued ordinary shares of Trematon.
In terms of the Subscription Agreements Trematon has given the various investors the
warranties and representations that are usual in transactions of this nature.
The Subscription Price represents a discount of approximately 13.73% to R3.48, being the 30-
day volume weighted average trading price (“VWAP”) of Trematon ordinary shares traded on the
exchange operated by the JSE Limited (“JSE”) over the 30 days up to and including 15
December 2014, the last trading day prior to this announcement.
2.2 RATIONALE FOR THE SPECIFIC ISSUES
The Specific Issues represent an opportunity to raise equity capital for the Company, the
proceeds of which will be applied to capitalise on the Trematon group’s substantial pipeline of
investments in all the main areas of operation, namely Commercial Property, Residential
Property, Leisure Property (mainly at Club Mykonos) and special investment opportunities for
investment in both listed and unlisted companies. The Company’s current level of available
cash resources is not sufficient to capitalise on all of these opportunities without a substantial
increase in the level of gearing. The amount of cash to be raised will be more than sufficient to
fund the Company’s existing investment pipeline over the next 12-18 months without taking on
excessive levels of debt.
2.3 CONDITIONS PRECEDENT FOR THE SPECIFIC ISSUES
The Subscription Agreements are subject to the fulfillment of the following conditions precedent
in relation to the Specific Issues by no later than 28 February 2015 (or such later date as the
parties may agree in writing), that:–
2.3.1 Shareholders, to the extent required, pass special resolutions in accordance with section
41(1) of the Companies Act, Act 71 of 2008, as amended (“Companies Act”), authorising
the allotment and issue of the Subscription Shares in terms of the Investor and Related
Party Issues;
2.3.2 Shareholders pass an ordinary resolution by a 75% majority giving specific authority in
terms of paragraph 5.51(g) of the JSE Listings Requirements to allot and issue the
Subscription Shares in terms of the Investor and the Related Party Issues; and
2.3.3 the approvals of all relevant regulatory bodies, including any approvals required in terms
of the JSE Listings Requirements in respect of the Investor and Related Party Issues, are
obtained.
2.4 APPROVALS REQUIRED FOR THE SPECIFIC ISSUES
2.4.1 All of the Specific Issues are subject thereto that ordinary resolutions of Trematon
Shareholders shall be passed by achieving a 75% majority of the votes cast at a general
meeting of Shareholders convened to specifically authorise the Company to issue shares
for cash to each of the parties in terms of the JSE Listings Requirements (“general
meeting”).
2.4.2 The Armchair Trust and Lemon Lane Nominees CC are controlled by directors of
Trematon and are related parties to Trematon. The Suikerbos Trust is a major
shareholder of Trematon and is also a related party. The Specific Issues to The Armchair
Trust, Lemon Lane Nominees CC and The Suikerbos Trust therefore constitute issues of
shares for cash to related parties at a 13.73% discount and consequently the board will
obtain an opinion from an independent expert confirming that the Related Party Issues
are fair insofar as Shareholders of Trematon are concerned.
2.4.3 In addition, in accordance with section 41(1) of the Companies Act, the approval of the
specific issues to The Armchair Trust and Lemon Lane Nominees CC will also require
the support of at least 75% of the Trematon shareholders present and entitled to vote at
the general meeting as shares will be issued to associates of the directors of the
Company.
2.4.4 The Armchair Trust, Lemon Lane Nominees CC and The Suikerbos Trust and their
associates will be precluded from voting at the general meeting on the resolutions in
relation to the Related Party Issues to the extent that they already hold Trematon shares.
3. PRO FORMA FINANCIAL EFFECTS
The table below illustrates the pro forma financial effects of the Specific Issues based on the
published results for the year ended 31 August 2014. The preparation of the pro forma
financial effects is the responsibility of the directors of Trematon. The pro forma financial
effects have been prepared for illustrative purposes only to provide information on how the
Specific Issues may have impacted on Trematon’s results and financial position and, due to
the nature thereof, may not give a fair reflection of Trematon’s results and financial position.
The pro forma financial information has been compiled using accounting policies that comply
with IFRS and that are consistent with those applied in the audited consolidated annual
financial statements of Trematon for the year ended 31 August 2014. The pro forma figures
have been given no greater prominence than unadjusted financial figures, are presented in a
manner consistent with both the format and accounting policies adopted in the historical
financial information and adjustments have been quantified on the same basis as would
normally be calculated in preparing financial statements.
After the
Before the Specific Specific %
Specific Issues Issues Issues Change
40 000 218 095
Gross number of shares in issue 178 095 823 000 823 22.5
Weighted average number of 40 000 216 323
shares in issue 176 323 052 000 052 22.7
Diluted weighted average number 43 380 233 517
of shares in issue 190 137 162 203 365 22.8
Basic earnings per share (cents) 24.5 (5.2) 19.3 (21.1)
Diluted earnings per share (cents) 22.7 (4.8) 17.9 (21.1)
Headline earnings per share (cents) 4.3 (1.4) 2.9 (32.7)
Diluted headline earnings per share
(cents) 4.1 (1.4) 2.7 (34.7)
Net asset value per share (cents) 167 24 191 14.6
Net tangible asset value per share
(cents) 165 24 189 14.5
Intrinsic net asset value per share
(cents) 315 (5) 310 (1.5)
Intrinsic net tangible asset value
per share (cents) 313 (5) 308 (1.6)
Notes and assumptions:
1. The pro forma Statement of Comprehensive Income figures illustrate the possible financial
effects as if the Specific Issues had taken place on 1 September 2013.
2. The pro forma Statement of Financial Position figures have been based on the assumption
that the Specific Issues had taken place on 31 August 2014.
3. The “Before the Specific Issues” column is based on the published audited financial
information of Trematon for the year ended 31 August 2014, as released on SENS on 20
November 2014.
4. The “Specific Issues” column relates to the following:
- the issue of the Subscription Shares being, 40 000 000 new Trematon ordinary shares for
cash at a price of R3.00 per Subscription Share, representing a 13.73% discount to the 30-
day VWAP of Trematon ordinary shares traded on the exchange operated by the JSE over
the 30 days up to and including 12 December 2014, being the last trading day prior to this
announcement.
5. The "After Specific Issues" column indicates the pro forma financial information of the
Specific Issues.
6. The issue of 3,380,203 convertible debentures to executive directors and other participants of
the Trematon Share Incentive Scheme, in terms of the provisions of the Scheme, has
resulted in a share-based payment transaction which has been recognised and measured in
terms of IFRS 2. The total share-based payment of R4,239,846 or R1,413,282 per year, has
been included.
7. Once-off transaction costs of R750 000 have been incurred in respect of the Specific Issues.
These include VAT (as Trematon is not in a position to claim the related input tax credits) and
have been assumed to be non-tax deductible. The costs have been charged to share
premium in terms of IAS 32.37.
8. In terms of paragraph 68 of the SAICA Guide on Pro Forma Financial Information issued
September 2014, no provision has been made for interest income earned on the surplus cash
raised, as the directors have not committed the use of the positive cash balances.
4. AMENDMENT OF THE TREMATON SHARE INCENTIVE SCHEME
4.1 Proposed amendments
The board of directors of the Company, taking into account the purpose of the Trematon
Share Incentive Scheme (“Scheme”), has resolved, subject to the consent of
Shareholders and the JSE, that in order to retain the alignment of the interests of the
Scheme participants with Shareholders, it is just and equitable to amend the Scheme
Trust Deed so that the 2014 new debenture allocation be available to existing
participants of the Scheme pro rata to their existing debentures in the Scheme; and to
permit the participants to participate in the acquisition of the 2014 new debenture
allocation at the Subscription Price of the Specific Issues.
4.2 Approvals required for the amendment of the Scheme
In terms of the JSE Listings Requirements, the ordinary resolution amending the Scheme
requires a 75% majority of the votes cast in favour of such resolution by all Shareholders
present or represented by proxy at the general meeting, excluding all the votes attaching
to all equity securities owned or controlled by persons who are existing participants in the
Scheme, and may be impacted by the changes.
5. DOCUMENTATION AND SALIENT DATES
A circular to Shareholders incorporating the terms of the Share Issues, the amendment of the
Scheme, a notice of general meeting and the fairness opinion of the independent expert is being
prepared and will be posted to Shareholders in due course.
Cape Town
17 December 2014
Sponsor:
Sasfin Capital (a division of Sasfin Bank Limited)
Legal Advisor:
Bernadt Vukic Potash & Getz
Date: 17/12/2014 02:15:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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