BRAIT SE - Voluntary announcement: disposal of interest in Steinhoff and acquisition of additional interest in Iceland Foods

Voluntary announcement: disposal of interest in Steinhoff and acquisition of additional interest in Iceland Foods

Brait SE
(Registered in Malta as a European Company)
(Registration No.SE1)
Share code: BAT ISIN: LU0011857645
Share Code: BATP ISIN: MT0000680208
(“Brait” or “the Company”)

VOLUNTARY ANNOUNCEMENT: DISPOSAL OF INTEREST IN STEINHOFF
AND ACQUISITION OF ADDITIONAL INTEREST IN ICELAND FOODS

DISPOSAL OF INTEREST IN STEINHOFF

Shareholders are referred to the announcements released
on the website of the Luxembourg Stock Exchange and on
the Stock Exchange News Service of the JSE Limited
(“SENS”) regarding Brait’s disposal of its 37.06%
interest in Pepkor Holdings Proprietary Limited
(“Pepkor”) to Steinhoff Group (“Steinhoff”). On 31 March
2015, Brait received R15 billion in cash and 200 million
Steinhoff shares in settlement of the Pepkor disposal
consideration.

As indicated in previous announcements and investor
communications, Brait’s minority shareholding in
Steinhoff was not aligned with the Company’s strategy of
acquiring majority stakes in sizeable unlisted companies.
Shareholders are accordingly advised that Brait has sold
its 200 million Steinhoff shares through block trades in
the market, facilitated by Legae Securities, for a
consideration of approximately R16 billion. A significant
portion of these shares were sold at a price
approximating the Steinhoff 30-day volume weighted
average price traded on the Johannesburg Stock Exchange
preceding the date of the sale.

The Company intends to apply the disposal proceeds
towards the full settlement of its R14.2 billion debt
obligations. The balance of the proceeds will be used for
future investment activities and capital management.

ACQUISITION OF ADDITIONAL INTEREST IN ICELAND FOODS

Brait, through its wholly-owned subsidiary Brait
Mauritius Limited, has reached agreement to acquire a
further 38% of Iceland Foods for GBP172 million. The
acquisition is subject to anti-trust clearance from the
Irish and Maltese authorities.

This transaction will increase Brait's stake in Iceland
Foods to 57% and is in line with Brait's strategy of
acquiring majority stakes in sizeable unlisted companies.
Management will retain 43%, whilst the vendors are Lord
Graham Kirkham and the Landmark Group.

Brait has been invested in Iceland Foods since March 2012
and believes it is now opportune to increase its
shareholding. Brait’s key investment considerations
particular to Iceland Foods reflect a company that:

   -   is well positioned with its value-end proposition
       for the current and medium-term economic climate
       prevailing in the UK;
   -   is a market leader and best known for its large
       range of quality and innovative private label
       frozen foods;
   -   has an extensive footprint of 858 stores in
       convenient high street locations across the UK,
   -   has strong cash flow generation from operations,
       which, post capital expenditure, has averaged 89%
       of EBITDA for the past three years;
   -   has the Founder and a strong, experienced
       management team who are significantly invested; and
   -   has made good progress with the new Food Warehouse
       concept stores which offer extended ranges of
       specialty frozen, chilled and fresh produce.

The consideration for the above transaction will be paid
from the proceeds of Brait’s recent GBP350 million
convertible bond issuance.

Brait, the Founder and management are excited about
partnering each other in taking Iceland Foods into its
next chapter.

2 October 2015

Investment bank and sponsor
RAND MERCHANT BANK (A division of FirstRand Bank Limited)

Stockbroker
Legae Securities

Brait’s primary listing is on the Euro MTF market of the
Luxembourg Stock Exchange and its secondary listing is on
the Johannesburg Stock Exchange.

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