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Acquisition of a 29.9% shareholding in Spire Healthcare Group PLC
Remgro Limited
(Incorporated in the Republic of South Africa)
(Registration number 1968/006415/06)
(ISIN: ZAE000026480)
(Share code: REM)
("Remgro" or "the Company")
ACQUISITION OF A 29.9% SHAREHOLDING IN SPIRE HEALTHCARE GROUP PLC
1. Introduction
Remgro shareholders are advised that Remgro, through a wholly-owned subsidiary of Remgro,
Remgro Jersey Limited ("Remgro Jersey"), has entered into an agreement with funds managed by
Cinven to acquire 119,923,335 Spire Healthcare Group Plc ("Spire") shares equivalent to a 29.9%
shareholding in Spire (the "Transaction").
Spire is a leading private healthcare group, led by a strong and highly experienced management
team, with a national network of 39 hospitals across the United Kingdom ("UK"). Spire delivers
tailored, personalised care to over 260,000 in-patients and day-case patients per year, funded
through private medical insurance, self-payment and National Health Service ("NHS") referrals. As a
leader in delivering superior clinical outcomes, Spire is well positioned to benefit from the long-
term structural growth drivers in the UK healthcare market. In addition to broad geographic
coverage across the UK, Spire has a well invested and scalable platform with the capacity to
increase volumes and a track record of growth with positive momentum. After being listed on the
premium listing segment of the UK Official List, the shares in Spire began trading on the Main
Market of the London Stock Exchange, in July 2014.
2. Transaction overview and rationale
Remgro currently owns 41.3% of the total issued share capital of Mediclinic International Limited
("Mediclinic"), an operator of private hospitals in Southern Africa, the United Arab Emirates and
Switzerland. Healthcare assets form approximately 25% of Remgro's overall portfolio and was
reorganised into a defined "healthcare portfolio" under Remgro. The Transaction will enable
Remgro to substantially grow this healthcare portfolio and enhance returns via geographic
diversification.
In keeping with Remgro's strategy of owning assets via various platform investments and
recognising Mediclinic as Remgro's main investment in its healthcare portfolio, Remgro has
concluded an agreement with Mediclinic whereby Mediclinic will acquire Remgro's interest in
Spire, subject to Mediclinic raising the appropriate funds in order to conclude such a transaction.
Remgro shareholders are referred to the Mediclinic announcement made on SENS today, 22 June
2015, in this regard.
Mediclinic proposes a rights issue of R10 billion in order to enable it to acquire the interest in Spire
from Remgro. Remgro has committed to follow all of their rights and agreed to underwrite the
balance of the proposed Mediclinic rights issue. In terms of the rights issue Mediclinic will issue
111,111,111 shares at R90 per share.
3. Key terms of the Transaction
3.1 Purchase price
Pursuant to the Transaction Remgro Jersey will acquire 119,923,335 Spire shares at a price of
GBP3.60 per share for a total purchase consideration of GBP431.7 million. Remgro will secure
the necessary funds from its own cash resources as well as financing arranged by Rand
Merchant Bank.
3.2 Board representation
Remgro Jersey has agreed with Spire that it will be entitled to appoint one director to the
Spire board for so long as it holds at least 15% of the Spire shares. Mediclinic will retain the
same right in respect of Spire board representation following the acquisition of the shares in
Spire.
3.3 Conditions precedent
There are no conditions precedent to the Transaction and all necessary regulatory approvals
have been granted.
3.4 Timeline
The expected closing date of the Transaction is 15 July 2015.
4. Financial effects of the Transaction
As at 31 December 2014 Spire had gross assets of GBP1,611.4 million. On an equity accounted basis
based on the 31 December 2014 Spire financial year end results, Remgro Jersey's 29.9%
shareholding in Spire amounts to GBP22.0 million in earnings on a pro forma adjusted basis.
5. The proposed acquisition by Mediclinic of the interest in Spire
The terms of the Transaction were negotiated jointly by Mediclinic and Remgro with the seller. The
Transaction effectively constitutes a warehousing transaction by Remgro for its investee company,
Mediclinic and Remgro and Mediclinic have in turn agreed the terms by which Mediclinic will,
subject to the completion of a rights issue to raise the requisite funding, acquire the shareholding
in Spire for an amount equal to the aggregate of the purchase price, transaction and funding costs.
A circular to Mediclinic shareholders will be distributed by Mediclinic in due course, setting out
further details of the proposed rights issue.
6. No bid statement
Remgro and Mediclinic confirm that they have no current intention of making an offer for the
whole of Spire. As a result of this announcement, Remgro and Mediclinic will be bound by the
restrictions contained in Rule 2.8 of the UK City Code on Takeovers and Mergers (the "Code"). In
summary, these restrictions prohibit Remgro and Mediclinic from making an offer for Spire (or from
acquiring further shares that would give rise to an obligation to make an offer for Spire) within the
next six months following the date of this announcement other than with the consent of the
Takeover Panel or in the circumstances described in Note 2 to Rule 2.8 of the Code (that is, with the
agreement of Spire's board, if a third party announces a firm intention to make an offer for Spire, if
Spire announces a "whitewash" proposal or reverse takeover, or if the Takeover Panel determines
that there has been a material change of circumstances). This statement is made with the consent
of Mediclinic.
Stellenbosch
22 June 2015
Investment Bank, Financial Advisor and Sponsor to Remgro
RAND MERCHANT BANK (A division of FirstRand Bank Limited)
Mandated Lead Arranger and Debt Advisor to Remgro
RAND MERCHANT BANK (A division of FirstRand Bank Limited)
International Legal Counsel to Remgro
Slaughter and May
South African Legal Counsel to Remgro
Cliffe Dekker Hofmeyr
Date: 22/06/2015 08:00:00 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.
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