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CONDUIT CAPITAL LIMITED - Declaration Announcement in Respect of the Conduit Capital Rights Offer

Release Date: 09/10/2015 17:45
Code(s): CND     PDF:  
Wrap Text
Declaration Announcement in Respect of the Conduit Capital Rights Offer

CONDUIT CAPITAL LIMITED
Incorporated in the Republic of South Africa
(Registration number 1998/017351/06)
Share code: CND ISIN: ZAE000073128
(“Conduit Capital” or “the Company” or “the Group”)


CONDUIT CAPITAL TO RAISE R150 MILLION TO PURSUE OPPORTUNITIES
DECLARATION ANNOUNCEMENT IN RESPECT OF THE CONDUIT CAPITAL RIGHTS OFFER


1.   INTRODUCTION

     Conduit Capital is pleased to announce that it intends to raise R150 000 000 by way of a fully
     underwritten renounceable rights offer (“Rights Offer”), in terms of which the Company will offer a
     total of 75 000 000 new Shares (“Rights Offer Shares”) at a subscription price of 200 cents per
     Rights Offer Share (“Subscription Price”) in the ratio of 29.25347 Rights Offer Shares for every
     100 Shares (“Ratio”) held at the close of business on the record date for the Rights Offer, being
     Friday, 27 November 2015 (“Record Date”).

2.   PURPOSE OF THE RIGHTS OFFER

     The purpose of the Rights Offer is to provide Conduit Capital with additional capital in the amount of
     R150 000 000 to enable the Company to pursue insurance related opportunities, some of which have
     already been identified.

3.   NATURE OF THE BUSINESS OF CONDUIT CAPITAL

     Conduit Capital is an investment holding company which is listed on the Main Board of JSE Limited
     (“the JSE”) with the specific objective of supporting its subsidiary companies and allocating capital
     across the Group. Conduit Capital operates through two main divisions, namely:
     - Insurance and Risk, which houses the Group’s insurance interests; and
     - Investments, which houses the Group’s investment activities.

4.   SALIENT TERMS OF THE RIGHTS OFFER

     In terms of the Rights Offer, Conduit Capital will offer a total of 75 000 000 Rights Offer Shares at a
     subscription price of 200 cents per Rights Offer Share in the ratio of 29.25347 Rights Offer Shares
     for every 100 shares held in Conduit Capital on the close of business on the Record Date.
    
     The Subscription Price represents:
     - a discount of 20.50% to the 30 day volume weighted average price (“VWAP”) to the traded price
        of Conduit Capital Shares on the JSE as at 11 September 2015, the date on which the Rights
        Offer was approved by the Board of Directors of Conduit Capital (“the Board”); and
     - a discount of 31.15% to the 30 day VWAP of Conduit Capital Shares on the JSE as at 8 October
        2015, being the date prior to the release of this announcement.
     
     Upon their issue, the Rights Offer Shares will rank pari passu in all respects with the existing Conduit
     Capital Shares.

5.   UNDERWRITING

     Conduit Capital will enter into an underwriting agreement with Protea Asset Management LLC
     (“Protea”) in respect of the Rights Offer, to the full value of R150 000 000 (“Underwriting
     Agreement”). Protea, in its capacity as investment advisor, acts on behalf of the ultimate underwriter,
     Ithuba Investments LP, which is a fund based in the United States of America (“USA”).
     Protea is an investment management business incorporated in the USA and founded by Mr
     S Riskowitz, the Chief Executive Officer of Conduit Capital.

     Mr Riskowitz, who is the Managing Member of Protea, has no direct beneficial interests in Conduit
     Capital Shares. He is however, a shareholder in a number of entities under his control, which own
     between them an aggregate of 34 431 333 Conduit Capital Shares.

     Further details of the Underwriting Agreement will be set out in the Rights Offer circular to be dated
     on or about 24 November 2015 and distributed to shareholders as set out in paragraph 10 below.

6.   CONDITIONS PRECEDENT

     The implementation of the Rights Offer is subject to the conclusion of the Underwriting Agreement,
     approval being obtained from the JSE of the Rights Offer circular and for the listing of the Letters of
     Allocation and the Rights Offer Shares.

7.   SALIENT DATES AND TIMES

     The proposed salient dates and times in respect of the Rights Offer are set out below:

                                                                                                     2015
      Rights Offer Declaration Data announcement released on SENS                       Friday, 9 October
      
      Rights Offer Finalisation announcement released on SENS                        Tuesday, 17 November
      
      Last day to trade in Conduit Capital Shares in order to settle trades by
      the Record Date for the Rights Offer and to qualify to participate in the
      Right Offer (cum entitlement) on                                                Friday, 20 November
      
      Listing of and trading in the Letters of Allocation on the JSE
      commences at 09:00 on                                                           Monday, 23 November
      
      Conduit Capital Shares commence trading ex-rights on the JSE at
      09:00 on                                                                        Monday, 23 November
      
      Circular and Form of Instruction posted to certificated shareholders           Tuesday, 24 November
      
      Record date for the Rights Offer for purposes of determining the 
     
      Conduit Capital shareholders entitled to participate in the Rights Offer
      at the close of business on                                                     Friday, 27 November
     
      Rights Offer opens at 09:00 on                                                  Monday, 30 November
      
      Holders of dematerialised Conduit Capital Shares will have their
      accounts at their CSDP or broker automatically credited with their
      Letters of Allocation on                                                        Monday, 30 November
     
      Holders of certificated Conduit Capital Shares will have their Letters of
      Allocation credited to an electronic register at the Transfer Secretaries
      on                                                                              Monday, 30 November
     
      Circular distributed to dematerialised shareholders, who have elected
      to receive such documents                                                       Tuesday, 1 December
     
      Last day to trade in Letters of Allocation in order to settle trades by the
      Record Date for the Letters of Allocation and participate in the Rights
      Offer at the close of business on                                                Friday, 4 December
      
      Last day for Form of Instruction to be lodged with the Transfer
      Secretaries by holders of certificated Conduit Capital Shares wishing to
      sell all or part of their Rights Offer Entitlement by 12:00 on                   Friday, 4 December
     
      Listing and trading of Rights Offer Shares commences on the JSE at
      09:00 on                                                                         Monday, 7 December
      
      Last day for Form of Instruction to be lodged with the Transfer
      Secretaries by holders of certificated Conduit Capital Shares wishing to
      subscribe for or renounce all or part of their Rights Offer Entitlement
      by 12:00 on (see note 2)                                                        Friday, 11 December
      
      Record date for Letters of Allocation                                           Friday, 11 December
    
      Rights Offer closes at 12:00 and payment to be made by certificated
      shareholders on                                                                 Friday, 11 December
     
      CSDP/broker accounts credited with Rights Offer Shares and debited
      with the payments due in respect of holders of dematerialised Conduit
      Capital Shares on                                                               Monday, 14 December
      
      Rights Offer Share certificates in terms of the Rights Offer posted to
      holders of certificated Conduit Capital Shares via registered post on or
      about                                                                           Monday, 14 December
      
      Results of Rights Offer announced on SENS on                                    Monday, 14 December

   Notes:
   1. Holders of dematerialised Conduit Capital Shares are required to notify their CSDP or broker of the action
      they wish to take in respect of the Rights Offer in the manner and by the time stipulated in the agreement
      governing the relationship between the dematerialised shareholder and his CSDP or broker.
   2. Conduit Capital share certificates may not be dematerialised or rematerialised between Monday,
      23 November 2015 and Friday, 27 November 2015, both days inclusive.
   3. CSDPs effect payment in respect of holders of dematerialised Rights Offer Shares on a delivery versus
      payment basis.
   4. To the extent that the rights are accepted, dematerialised shareholders will have their accounts at their
      CSDP automatically credited with their rights and certificated shareholders will have their rights credited to
      an account at Computershare Investor Services.
   5. Rights Offer share certificates to be issued in terms of the Rights Offer will be posted to persons entitled
      thereto, by registered post, at the risk of the certificated shareholders concerned.

8. RESTRICTIONS ON THE RIGHTS OFFER

   Any shareholder resident outside the Common Monetary Area, being the Republics of South Africa
   and Namibia and the Kingdoms of Lesotho and Swaziland, who receives the Rights Offer circular and
   accompanying form of instruction, should obtain advice as to whether any governmental and/or any
   other legal consent is required and/or any other formality must be observed to enable such a
   subscription to be made in terms of such form of instruction.

   The Rights Offer does not constitute an offer in any jurisdiction in which it is illegal to make such an
   offer and the Rights Offer circular and accompanying form of instruction should not be forwarded or
   transmitted any person in any territory other than where it is lawful to make such an offer.

   The Rights Offer Shares have not been and will not be registered under the Securities Act of the
   United States of America. Accordingly, the Rights Offer Shares may not be offered, sold, resold,
   delivered or transferred, directly or indirectly, in or into the United States or to, or for the account or
   benefit of, United States persons, except pursuant to exemptions from the Securities Act. The Rights
   Offer circular and the accompanying documents are not being, and must not be, mailed or otherwise
   distributed or sent in, into or from the United States. The Rights Offer circular does not constitute an
   offer of any securities for sale in the United States or to United States persons.
  
   The Rights Offer contained in the Rights Offer circular does not constitute an offer in the District of
   Columbia, the United States, the Dominion of Canada, the Commonwealth of Australia, Japan or in
   any other jurisdiction in which, or to any person to whom, it would not be lawful to make such an offer
   (“Non-qualifying shareholder”). Non-qualifying shareholders should consult their professional
   advisers to determine whether any governmental or other consents are required or other formalities
   need to be observed to allow them to take up the Rights Offer, or to trade their entitlement. To the
   extent that Non-qualifying shareholders are not entitled to participate in the Rights Offer, such Non-
   qualifying shareholders should not take up their Rights Offer entitlement or trade in their Rights Offer
   entitlement and should allow their rights in terms of the Rights Offer to lapse.

9. ANTICIPATED DIRECTORS DEALINGS IN TERMS OF RIGHTS OFFER SHARES

   Of the 44 589 257 Shares (which, in applying the Ratio, equates to 13 043 906 rights) held by
   Directors (and their associates) as at 9 October 2015, being the date of this announcement, 65.20
   in respect thereof, have indicated an intention to follow their rights, while 9.33% in respect thereof
   have indicated an intention to sell their rights in terms of the Rights Offer as follows:

      Director                                    Rights to be followed                     Rights to be sold
      S M Riskowitz’s associates                                7 919 261                                    -
      L E Louw                                                    325 000                              786 632
      R L Shaw                                                     50 000                              101 149
      G Toet                                                      210 000                              328 625
      Total                                                     8 504 261                            1 216 406

10. FURTHER ANNOUNCEMENT AND CIRCULAR

    The Rights Offer Finalisation announcement is expected to be released on SENS on or about
    17 November 2015.
 
    The Rights Offer circular, and accompanying Form of Instruction for use by certificated shareholders
    only, containing full particulars of the Rights Offer will be posted to shareholders on or about
    24 November 2015.
    
    The Rights Offer circular containing full particulars of the Rights Offer will be distributed to
    dematerialised shareholders who have elected to receive documents on or about 1 December 2015.


Johannesburg
9 October 2015

Sponsor
Merchantec Capital


Forward Looking Statement:
This announcement contains certain forward looking statements. These forward-looking statements are not historical
facts but rather are based on the Company’s current expectations, estimates and projections about the industry in
which Conduit Capital operates, and beliefs and assumptions regarding the Company’s future performance. Words
such as “anticipates”, “expected”, “intends”, “plans”, “believes”, “seeks”, “estimated”, “potential” and similar
expressions are intended to identify forward-looking statements. These statements are not guarantees of future
performance and are subject to known and unknown risks, uncertainties and other factors, some of which are beyond
the control of the Company, are difficult to predict and could cause actual results to differ materially from those
expressed or forecasted in the forward-looking statements. Conduit Capital cautions shareholders and prospective
shareholders not to place undue reliance on these forward-looking statements, which reflect the view of Conduit
Capital only as of the date of this announcement. The forward-looking statements made in this announcement relate
only to events as of the date on which the statements are made. Conduit Capital will not undertake any obligation to
release publicly any revisions or updates to these forward-looking statements to reflect events, circumstances or
unanticipated events occurring after the date of this announcement except as required by law or by any appropriate
regulatory authority.

Date: 09/10/2015 05:45:00 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.

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