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SHF\JDG - Firm Intention by Steinhoff to acquire remaining issued share capital of JD Group, and a de-listing of JDG
STEINHOFF INTERNATIONAL HOLDINGS LIMITED JD GROUP LIMITED
(Incorporated in the Republic of South Africa) (Incorporated in the Republic of South Africa)
(Registration number 1998/003951/06) (Registration number 1981/009108/06)
JSE share code: SHF ISIN: ZAE000016176 JSE share code: JDG ISIN: ZAE000030771
(“Steinhoff”) (“JD Group”)
JOINT ANNOUNCEMENT – FIRM INTENTION BY STEINHOFF TO MAKE AN OFFER TO ACQUIRE THE
REMAINING 13.22% OF THE ISSUED SHARE CAPITAL OF JD GROUP THAT IT DOES NOT ALREADY OWN,
ACCOMPANIED BY A DE-LISTING OF JD GROUP
1. INTRODUCTION
The board of directors of both Steinhoff and JD Group herewith announce that Steinhoff has made an offer to
acquire the entire issued ordinary share capital of JD Group (excluding treasury shares) not already owned by
Steinhoff (“Remaining Shares”), by way of a scheme of arrangement (“Scheme”) in terms of section 114 of the
Companies Act No. 71 of 2008, as amended (the "Companies Act"), to be proposed by the board of directors of
JD Group to the holders of the Remaining Shares (“Remaining Shareholders”). Alternatively, if the resolution
proposing the Scheme is not approved by the requisite majority of the Remaining Shareholders, Steinhoff
intends to extend a substitute offer to the Remaining Shareholders ("Substitute Offer") in terms of section
117(1)(c)(v) of the Companies Act. Following the implementation of the Scheme or the Substitute Offer
(“collectively the “Offers”) as the case may be, JD Group will be de-listed from the securities exchange operated
by the JSE Limited (“JSE”).
2. OFFER CONSIDERATION
2.1. Subject to the fulfilment of the conditions precedent set out in paragraph 5 hereunder, the consideration
proposed in respect of the Offers will comprise a cash consideration of R34.00 per Remaining Share
(“Offer Price”), translating to a maximum aggregate consideration of R1 193 790 218 (“Offer
Consideration”) payable to the holders of the Remaining Shares.
2.2. The Offer Price represents premiums of:
2.2.1. 35.44% to the volume weighted average price of JD Group ordinary shares traded on the JSE over
the 30 business days up to and including Monday, 20 April 2015, being the last practical date
before the offer date of 21 April 2015 (“Offer Date”); and
2.2.2. 21.43% to the closing price of JD Group ordinary shares on the JSE on the last practical date
before the Offer Date.
3. RATIONALE
The successful implementation of either of the Offers will allow for JD Group ordinary shares to be delisted
from the JSE, which will:
- eliminate costs associated with the listing on the JSE;
- simplify Steinhoff’s corporate and operating structure, as JD Group will become a wholly-owned subsidiary;
and
- provide Steinhoff with enhanced restructuring flexibility.
4. OFFER MECHANICS
The Offers are envisaged to be implemented as follows, subject to the conditions precedent set out in
paragraph 5 below:
4.1. the Scheme will be proposed in terms of section 114 of the Companies Act as read together with section
115 of the Companies Act;
4.2. payment of the Offer Price to the Remaining Shareholders, pursuant to the Scheme, will be effected on
the operative date of the Scheme, being on or about 13 July 2015;
4.3. it will be an express term of the Scheme that, if the condition precedent in 5.1.1 (relating to the resolution
of JD Group shareholders’ pursuant to which the Scheme is proposed) is not approved by the requisite
majority of the Remaining Shareholders, then, as soon as is reasonably possible thereafter, Steinhoff will
implement the Substitute Offer, accompanied by a voluntary delisting of JD Group in terms of section
1.14 and 1.15 of the Listings Requirements (“the Delisting”).
It is a requirement of the Delisting that the independent board of JD Group (“Independent Board”) determines
that the terms and conditions of the Offers are fair to the Remaining Shareholders.
5. CONDITIONS PRECEDENT
5.1. The Scheme will, in addition to the conditions precedent set out in 5.2 and 5.3 below, be subject to the
fulfilment of the following conditions precedent:
5.1.1. the approval of the Scheme by the requisite majority (75%) of Remaining Shareholders in general
meeting (“General Meeting”), as contemplated in section 115(2), read together with sections
164(7) and 164(3) of the Companies Act; or alternatively
5.2. In the case of the Substitute Offer, the Delisting will, in addition to the conditions precedent as set out in
5.3 below, be subject to the fulfilment of the following conditions precedent:
5.2.1. the requisite majority (50%) of the Remaining Shareholders in general meeting approving the
relevant resolutions required to implement the Delisting;
5.2.2. the Offer Price is considered to be fair as advised by PricewaterhouseCoopers Corporate Finance
Proprietary Limited.
5.3. The implementation of the Offers and the Delisting (whether in the form of the Scheme or the Substitute
Offer) will furthermore be subject to such Regulatory approvals as may be required, including:
5.3.1. the JSE;
5.3.2. the Takeover Regulation Panel (“TRP”); and
5.3.3. the South African Reserve Bank.
6. FUNDING OF THE CONSIDERATION
Steinhoff proposes to fund the Offer Consideration in cash from its own resources. The TRP has been
provided with an irrevocable and unconditional cash confirmation from The Standard Bank of South Africa
Limited in compliance with regulations 111(4) and 111(5) of the Companies Regulations, 2011.
7. SHAREHOLDER UNDERTAKINGS
Steinhoff has received irrevocable undertakings from certain Remaining Shareholders who, at the date of this
announcement, hold between them 19 610 430 JD Group ordinary shares (being 55.85% of the Remaining
Shares), to vote in favour of all the resolutions to be proposed at the General Meeting in respect of the Offers.
Based on the level of support from Remaining Shareholders currently received, the de-listing of JD Group
should in all likelihood proceed.
8. SHAREHOLDINGS IN JD GROUP AND ACTING AS PRINCIPAL
Steinhoff confirms that it is the ultimate proposed purchaser of all the Remaining Shares and that it is acting
alone and not in concert with, or as agent or broker for, any other party.
Steinhoff is the beneficial owner of 230 570 192 JD Group ordinary shares, comprising approximately 86.78%
of the issued ordinary share capital of JD Group (excluding treasury shares).
9. TERMINATION OF LISTING
Following implementation of any of the Offers, application will be made to the JSE to terminate the listing of JD
Group ordinary shares on the JSE.
10. DOCUMENTATION
Further details of the Offers and Delisting will be included in the Circular to be sent to the Remaining
Shareholders, containing, inter alia, a notice of the General Meeting, a form of proxy and a form of surrender
and transfer. The Circular is expected to be posted to Remaining Shareholders on or about Tuesday, 19 May
2015. The salient dates in relation to the Offers and Delisting will be published prior to the posting of the
Circular.
11. RESPONSIBILITY STATEMENT
Steinhoff and the Independent Board accepts responsibility for the information contained in this
announcement, and confirm that to the best of their respective knowledge and belief, the information set out
herein is true and this announcement does not omit anything likely to affect the importance of the information
included.
By order of the Steinhoff board of directors and the Independent Board
Wynberg, Sandton
21 April 2014
Financial adviser to Steinhoff
Investec Bank Limited
Transactional sponsor to Steinhoff and JD Group
Investec Bank Limited
Sponsor to Steinhoff and JD Group
PSG Capital Proprietary Limited
Date: 21/04/2015 12:59:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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