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Voluntary commencement of business rescue proceedings of the company in terms of the Companies Act
AFRICAN BANK INVESTMENTS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1946/021193/06)
(Ordinary share code: ABL) (ISIN: ZAE000030060)
(Preference share code: ABLP) (ISIN: ZAE000065215)
("ABIL" or "the Company")
VOLUNTARY COMMENCEMENT OF BUSINESS RESCUE PROCEEDINGS OF THE COMPANY IN
TERMS OF SECTION 129(1) OF THE COMPANIES ACT, NO 71 OF 2008
Since late 2014 the Company has been in discussions with a consortium of six banks and the Public
Investment Corporation ("the PIC"), (collectively referred to as "the Consortium") for the sale of The Standard
General Insurance Company Limited ("Stangen") to them pursuant to the statement of 10 August 2014 of the
then Governor of the South African Reserve Bank ("SARB"). To date no agreement has been concluded
and no offer has been received from the Consortium to purchase the Company’s equity in Stangen.
The Company has a loan from African Bank Limited (In Curatorship) ("ABL") of approximately R447 million
and has issued guarantees to Absa Bank Limited, FirstRand Bank Limited, Investec Bank Limited and The
Standard Bank of South Africa Limited, (collectively referred to as the "Creditors") for banking facilities that
were granted respectively by these Creditors to Ellerine Furnishers (Proprietary) Limited (In Business
Rescue) ("EF"). These guarantees were for a total of approximately R550 million. Certain interim payments
were made to these Creditors by EF’s business rescue practitioners. ABIL’s intention was to settle the
Creditors from the proceeds of the sale by it of the entire issued equity held by it in Stangen.
On Wednesday and Thursday, 3 and 4 June 2015, the Creditors served letters of demand on the Company
for payment of the loan and amounts due under the guarantees respectively. The Company is not a trading
company and its source of cash is from dividends it receives from Stangen. The Company did not have
access to cash to pay the Creditors. The board of directors convened a meeting and after considering
various options the board of directors resolved to and approved a resolution to voluntarily begin a business
rescue process as contemplated in section 129(1) of the Companies Act, No 71 of 2008.
A further announcement will be made in due course.
By order of the board
Midrand
5 June 2015
Sponsor
RAND MERCHANT BANK (A division of FirstRand Bank Limited)
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