Final terms announcement LABAT AFRICA LIMITED (Incorporated in the Republic of South Africa) (Registration number 1986/001616/06) (“Labat” or “the Company”) ISIN Code: ZAE 000018354 Share code: LAB FINAL TERMS ANNOUNCEMENT REGARDING THE ACQUISITION OF REINHARDT TRANSPORT GROUP (“RTG”) BY LABAT AND WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT Shareholders are referred to the Company?s announcements of 22 April 2015 and 18 May 2015 regarding Labat?s intention to acquire RTG. Shareholders are advised that Labat and RTG have now concluded an agreement for the acquisition subject to certain conditions precedent (“the Transaction”). Amended terms of the Transaction Labat will acquire 100% of RTG for a consideration of R645 million. It is intended that the financing will be structured by way of R325 million of debt and the balance through a Private Placement of shares in Labat. Labat intends issuing 240 million new Labat shares at 150 cents per share to settle the balance of the consideration. The Effective date of the Transaction is 1 August 2015. Shares will be issued by way of a Private Placing with a preference given to BEE investors, existing Labat shareholders and the RTG vendors and management. The total number of shares in issue in Labat post the Transaction will be approximately 500 000 000 (five hundred million). The rationale for the Private Placement being offered to primarily BEE investors is due to the intention to retain Labat?s Level 1 BEE rating post the Transaction. As part of the restructuring of the RTG business: . Mr Derick Reinhardt and management will retain a substantial shareholding in Labat for a minimum period of 18 months. . The shareholding retained by management and Mr Derick Reinhardt will be vended in at the subscription consideration. . Mr Derrick Reinhardt will be appointed as a Non-executive director on the board during the handover period. . Mr Reinhardt will provide strategic input and facilitate a smooth handover. Rationale for the Transaction The rationale for the Transaction is in line with Labat?s strategy to be a leading transport and logistics company operating in South Africa and sub-Saharan Africa providing transport infrastructure related services. This will be the first acquisition in line with this strategy. Conditions precedent The Transaction is subject to regulatory approvals, including JSE and Competition Commission approvals, as well as approval by the directors and shareholders of Labat and RTG. Pursuant to the approval of the Transaction and associated resolutions, Labat will be making an application for a transfer of its listing to the Main Board of the JSE Limited. Financial information The financial information in relation to RTG is set out below: RTG 31 July 2014 July 2015 Year end projections Turnover: R1.5bn R1.5bn EBITDA R316m R335m Net profit after taxation (“NPAT”) R60.8m R100.7m Adjusted sustainable net profit after R98.3m R107.9m taxation (“ANPAT”)* Net asset value R314m R415m * - adjusted for once-off non-recurring items. The expected financial impact of the Transaction on Labat, including the intended Private Placement is estimated below: Labat 31 July 2014 July 2015 Year end projections Shares in Issue (fully diluted) 500m 500m Assumed after tax interest charge on debt N/A R24.6m raised for full year EPS (based on NPAT after interest) 8 cents 16 cents EPS (based on ANPAT after interest) 16 cents 17 cents PE Multiple on NPAT (based on 150 cents) 19.0 9.0 PE Multiple on ANPAT (based on 150 cents) 9.5 8.8 Industry PE multiple Average 12 12 Potential investors subscribing at 150 cents per share do so at a PE multiple of approximately 9.1 and 8.7 on adjusted sustainable net profit with an industry PE multiple averaging 12, which implies a potential discount of between 25% and 30%. Furthermore, Labat„s level 1 BEE credentials will add additional potential to the business post the Transaction as certain contracts and opportunities were not previously available to the company. The immediate focus will be to target substantial new contracts which require improved and essential BEE input. The new BEE status is expected to further enhance and expand existing client contracts. Labat?s overall strategy is to create a large BEE transport and logistics business through a combination of organic and acquisitive growth. RTG will form the core of the business strategy and expansion with many further opportunities available. To assist with the growth strategy, Global Emerging Market (“GEM”), a USA based private equity fund has extended its funding commitment with an equity facility of $100 million (R1.2 billion) to Labat for a further five years, to fund further acquisitions in the transport and logistics sector. The details of the placing will be communicated in due course and interested participants are encouraged to contact the Company?s sponsor to register an interest on 011 480 8500 with Michelle Krastanov or Kay Stoler. Categorisation and documentation The Acquisition is classified as a Category 1 transaction in terms of the JSE Listings Requirements and will constitute a reverse listing, which will require JSE approval as previously announced. Shareholders are thus advised that the preparation of a circular, containing full details of the Transaction, will now commence and it is expected that the circular, incorporating a notice of General Meeting will be posted within 60 days of this announcement. Post the Transaction; RTG will become a subsidiary of Labat. Accordingly, Labat will ensure that the provisions of the RTG memorandum of incorporation do not frustrate or relieve Labat in any way from compliance with its obligations in terms of the JSE Listings Requirements. Withdrawal of cautionary announcement Following the release of this announcement, the cautionary announcement is hereby withdrawn. Johannesburg 12 June 2015 Sponsor Arbor Capital Sponsors Proprietary Limited Date: 12/06/2015 08:45:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on, information disseminated through SENS.