NAMPAK LIMITED - Update on disposal of corrugated, sacks and tissue divisions and disposal of further businessses in South Africa

Update on disposal of corrugated, sacks and tissue divisions and disposal of further businessses in South Africa

Nampak Limited
(Incorporated in the Republic of South Africa)
Registration number: 1968/008070/06
Share code: NPK
ISIN: ZAE000071676
(“Nampak” or “the Company” or “the Group”)

UPDATE ON DISPOSAL OF CORRUGATED, SACKS AND TISSUE DIVISIONS
AND DISPOSAL OF FURTHER BUSINESSSES IN SOUTH AFRICA

It was announced on 20 November 2014 that Nampak had entered
into an agreement with Ethos Private Equity Proprietary
Limited on behalf of Ethos Fund V1 (“Ethos”), in terms of
which Nampak agreed to sell to Ethos in one, indivisible
transaction its Corrugated, Sacks and Tissue divisions
(excluding the Group’s shareholding in Sancella Proprietary
Limited and its Recycling business)(“the Transaction”).

One of the conditions precedent to the sale of the Sacks
business has not been fulfilled. As a result the sale of the
Sacks division will not proceed and it will remain part of
Nampak. As a result, the purchase consideration for the
Transaction will reduce from R1.575 billion to R1.530 billion.
All other conditions precedent to the Transaction have been
fulfilled or waived and the effective date of the sale of the
Corrugated and Tissue divisions is expected to be on 1 April
2015. The change to the Transaction does not have any material
impact.

Nampak further advises that it has subsequently agreed to sell
its Recycling business to Ethos for a purchase consideration
of R76.3 million. The Recycling business is a provider of
waste paper to the Corrugated and Tissue businesses and will
no longer be core to Nampak’s operations after the sale of
those businesses. The sale is subject to a number of
conditions precedent, including approval from the competition
authorities in South Africa. Subject to fulfilment of the
conditions precedent, Nampak expects the sale of the Recycling
business to be implemented early in the second half of the
2015 calendar year.

As a further part of Nampak’s strategic portfolio optimisation
to unlock cash from low margin businesses to redeploy into
high-yield and high growth opportunities on the rest of the
African continent, shareholders are advised that Nampak has
reached   agreement   with  Amcor   Flexibles   South   Africa
Proprietary Limited, a member of the Amcor group (“Amcor”) to
sell its Nampak Flexible division to Amcor. Amcor is a global
packaging group which supplies a broad range of flexible and
rigid plastic packaging products. The purchase consideration
for the Flexible business will be between R250 and R300
million,    dependent on the profitability of the Flexible
business   during the 12 month period to 30 June 2016. Nampak
Flexible    manufactures and sells flexible plastic packaging
products   from a number of manufacturing sites in South Africa.
The sale   is in line with Nampak’s stated strategy of focusing
on core     product segments, namely metals, glass and rigid
plastic,   in South Africa and the rest of Africa.

The sale of the Nampak Flexible business is subject to a
number of conditions precedent, including approval from the
competition authorities in South Africa. Subject to fulfilment
of conditions precedent, Nampak expects the sale of the
Flexible business to be implemented in the second half of the
2015 calendar year. The value of the consideration payable for
the business is below the carrying value of the net assets of
the business at 30 September 2014. As a result it has become
necessary to effect an impairment of approximately R76.4
million which will be accounted for in the results for the six
month period ending 31 March 2015.


Sandton

25 March 2015
Sponsor: UBS (South Africa) (Pty) Ltd

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