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Acquisition of 51.0% interest in Robor (Pty) Limited
Tiso Blackstar Group SE
(previously Blackstar Group SE)
(Incorporated in Malta)
(Company number SE 4)
(registered as an external company with limited liability in the Republic of South Africa under
registration number 2011/008274/10)
LSE Ticker: TBGR
JSE Share code: TBG
ISIN: MT0000620113
30 July 2015
Tiso Blackstar Group SE (“Tiso Blackstar” or the “Company”)
Acquisition of 51.0% interest in Robor (Pty) Limited (“Robor”)
Tiso Blackstar’s strategy is to have meaningful interests in its underlying investments in order to have
an influence on the investee companies’ strategy and control over cash flow. In line with this strategy,
the board of the Company (“Board”) is pleased to announce that it will increase its interest in Robor
(held by its wholly owned subsidiary, Tiso Blackstar Cyprus Limited) from 19.4% to 51%. Tiso
Blackstar will purchase additional ordinary shares in Robor from certain existing Robor shareholders
(“the Sellers”) for a consideration of R29.6 million (£1.5 million) (“the Consideration”) which will be
settled through the issue of new Tiso Blackstar shares at intrinsic net asset value (“NAV”) per share
(“the Robor Transaction”).
The Board is of the view that the Company is buying Robor at a cyclical low and therefore at an
attractive time in the cycle and at an attractive price. Robor has an existing and growing African
footprint that will benefit from the increasing infrastructure spend taking place on the African
continent. With a strong balance sheet and an aligned management team who will hold the remaining
49% of the shares in the company, Robor is well positioned for expansion and growth.
Established in 1922, Robor (a private South African company), is a manufacturer and supplier of
welded steel tube and pipe, cold formed steel profiles and associated value added products. The
company also supplies, distributes and adds value to carbon steel coil, plate, sheet and structural
profiles. Robor is the largest tube and pipe solution company in Southern Africa and is active in most
industries including, mining transport – rail and road, construction, engineering, manufacturing,
agriculture, energy, water and automotive. Robor’s mission is to be an engineering steel, tube and
pipe company with an African focus. Robor generated a profit of R74.8 million (£3.8 million) before
extraordinary items and taxation for its year ended 30 September 2014. Robor has recently
completed a strategic acquisition of Tricom Structures who design, develop and manufacture steel
structures for telecom tower companies, cell phone operators and power sectors. The demand for
Tricom products/solutions is growing in Africa and will add value to Robor’s capabilities in terms of
providing solutions across various market segments.
The Robor Transaction is subject to the fulfilment of a number of suspensive conditions precedent,
including, inter alia:
a) approval or deemed approval is obtained from the South African Competition Authorities
(being the Competition Commission and/or the Competition Tribunal, as the case may be,
both as established in terms of the South African Competition Act; 1998), as may be required
or provided for in terms of the South African Competition Act, 1998;
b) to the extent required, approvals or deemed approvals are obtained as are required to give
effect to and implement the Proposed Transaction, including the approval of the JSE and the
South African exchange control authorities; and
c) the Sellers and Tiso Blackstar agree in writing the terms to be contained in the Robor
Memorandum of Incorporation which shall be consistent with the terms and conditions of the
shareholders' agreement, to be adopted immediately after the implementation of the Robor
Transaction.
The Robor Transaction will only be implemented and become effective once all of the conditions
precedent have been met, but by no later than 30 November 2015.
Tiso Blackstar will purchase additional ordinary shares in Robor from the Sellers thereby increasing its
stake to 51% for the Consideration, equal to its fair value, of R29.6 million (£1.5 million). The
Consideration will be settled through the issue of 1,740,358 new Tiso Blackstar ordinary shares of
€0.76 each (“the Shares”) on the JSE share register at a price of R17.00 per Share to the Sellers.
The issue price of R17.00 is the Company’s intrinsic NAV per Share post the acquisition of the
investments in Times Media Group Limited and Kagiso Tiso Holdings (Pty) Limited and as disclosed
in Annexure B of the Company’s Annual Report 2014 (refer to page 9).
As the Tiso Blackstar shares have been issued at intrinsic NAV (being a premium to the current
market price), there is no dilutive effect for existing Tiso Blackstar shareholders. Tiso Blackstar has
been able to acquire control of Robor at a significant discount to the tangible balance sheet NAV
(excluding goodwill and intangible assets) while at the same time issuing its shares at intrinsic NAV
per share.
Following completion of all of the pre-conditions (expected to be in mid-September), the Company will
make an application to both the London Stock Exchange and the JSE for admission of 1,740,358 new
Tiso Blackstar Group SE shares to AIM and the JSE, and will seek to implement the Robor
Transaction immediately thereafter.
It is Tiso Blackstar’s strategy to evolve the group so as to hold four to six core investments, each of
which can have a meaningful impact on NAV. The Company is in the process of selling all its smaller
investments, including properties, the proceeds of which will be used to reduce its acquisition finance
facility.
For further information, please contact:
Tiso Blackstar Group SE Leanna Isaac + 356 2137 3360
Zai Corporate Finance Limited
- Corporate Finance Tom Price / Richard Morrison +44 (0) 20 7060 2220
- Sales Steven Baird +44 (0) 20 7060 2220
PSG Capital Proprietary Limited David Tosi +27 (0) 21 887 9602
Powerscourt Juliet Callaghan / John Elliott +44 (0) 20 7250 1446
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