NVEST FINANCIAL HOLDINGS LIMITED - Combined agreement for the acquisition of an additional 50% interest in NVest Properties Limited

Combined agreement for the acquisition of an additional 50% interest in NVest Properties Limited

NVEST FINANCIAL HOLDINGS LIMITED
(formerly NVest Financial Holdings (RF) Proprietary Limited and in the process of being
changed from NVest Financial Holdings (RF) Limited)
(Incorporated in the Republic of South Africa)
(Registration number 2008/015990/06)
(“NVest”)
ISIN Code: ZAE000199865 JSE Code: NVE


COMBINED AGREEMENT FOR THE ACQUISITION OF AN ADDITIONAL 50% INTEREST IN NVEST
PROPERTIES LIMITED (“NVest Properties”) AND AN ISSUE OF SHARES FOR CASH, APPOINTMENT TO
THE BOARD AND SECTION 122 ANNOUNCEMENT


1.   Background
     NVest shareholders are advised that NVest has entered into a combined agreement with
     the Rayner Sparg Trust in terms of which the Company will:

     a.) acquire an additional 50% interest in NVest Properties for a purchase consideration of
         R16 892 586 to be settled through the issue of 13 514 069 shares in NVest at an issue
         price of R1.25 cents per share (“the Acquisition”); and
     b.) issue 23 856 569 new shares at an issue price of R3.35 for a cash subscription of
         R79 897 992 under NVest’s general authority to issue shares for cash (“the Issue for
         Cash”).

     Prior to the Acquisition, NVest holds 45% in NVest Properties. The Rayner Sparg Trust is not a
     related party to NVest as defined in the JSE Listings Requirements.

     Subsequent to the above share issues, NVest will have 242 500 000 shares in issue.

2.   Description of the business carried on by NVest Properties
     NVest Properties is a property investment company structured to invest in retail, industrial
     and commercial property situated in South Africa. The acquisition of each property is
     subject to a strict investment policy based on strong cash flows and solid property
     fundamentals. NVest Properties has the ability to invest in a combination of directly held
     commercial property and select property securities and the property portfolio held by the
     NVest Properties (currently valued at approximately R282m) has a medium risk profile with
     a five to ten year time horizon.

     NVest Properties hand-picks select commercial property throughout South Africa with
     quality, medium to long-term leases in prime locations. The focus will be in the retail, office
     and industrial sectors.

3.   Effective Date
     The effective date for the Acquisition and the Issue for Cash is 1 June 2015.
4.    Rationale for the Acquisition and the Issue
      The rationale for the Acquisition is for the Company to obtain control of NVest Properties
      and to secure a strategic shareholder in the form of the Rayner Sparg Trust.

5.    Conditions precedent
      All conditions precedent in terms of the Acquisition and Issue for Cash have been fulfilled.
      NVest will proceed with the application for the listing of the shares on the JSE.

6.    Categorisation
      The Acquisition is classified as a Category 2 transaction in terms of the JSE Listings
      Requirements.

7.    Financial information
      Per the audited financial statements of NVest Properties as at 28 February 2015, the
      financial information is as follows:

       -   The value of the net assets of NVest Properties was R49 million; and
       -   The profit after tax attributable to the net assets was R17.5 million (including
           revaluation adjustments of R12.4 million).

      Subsequent to the year end, there have been no material changes to the above other
      than in the ordinary course of business.

8.    Memorandum of Incorporation (“MOI”) of NVest Properties
      Post the Acquisition; NVest will hold a total interest of 95% in NVest Properties making NVest
      Properties a subsidiary of NVest. Accordingly, NVest will ensure that the provisions of the
      MOI do not frustrate or relieve the Company in any way from compliance with its
      obligations in terms of the JSE Listings Requirements.

9.    Section 122 announcement
      Pursuant to the issue of shares for the Acquisition and the Issue for Cash, Rayner Sparg Trust
      will hold 20% in NVest. The appropriate section 121 declarations will be submitted to the
      Takeover Regulation Panel.

10.   The Issue for Cash
      The Issue for Cash is under NVest’s general authority to issue shares for cash and the shares
      have been issued at a premium to the price of the shares issued in terms of the recent
      prospectus issued by the Company.

      The Issue for Cash is to a public shareholder as defined in the JSE Listings Requirements and
      the shares will rank pari passu to the existing shares in issue.

      The proceeds from the Issue for Cash will increase the cash reserves of the group and be
      applied towards the intended growth of NVest by way of acquisition.
11.   Appointment to the board of directors
      Pursuant to the Acquisition and the Issue for Cash, the board of directors of NVest has
      approved the appointment of Dylan Schemel (CA) SA as a non-executive director with
      immediate effect.


29 May 2015
East London

Designated Advisor
Arbor Capital Sponsors Proprietary Limited

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