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Listing of Gaia on the Main Board of the JSE and Abridged Pre-Listing Statement
Gaia Infrastructure Capital Limited
(previously Gaia Capital Proprietary Limited)
(Incorporated in the Republic of South Africa)
(Registration number 2015/115237/06)
Share Code: GAI
ISIN ZAE000210555)
(“Gaia” or “the Company”)
LISTING OF GAIA ON THE MAIN BOARD OF THE JSE LIMITED (“JSE”) AND
ABRIDGED PRE-LISTING STATEMENT
1. INTRODUCTION
1.1. The board of directors of Gaia (“Board”) intends to list Gaia
on the main board of the JSE as a special purpose acquisition
company (“SPAC”) as envisaged in the Listings Requirements of
the JSE (“Listings Requirements”), being a special purpose
vehicle established to facilitate the primary capital raising
process to enable the acquisition of assets which meet the
investment policy and acquisition criteria set out in
paragraph 4.3 below, which, if acquired, will enable Gaia to
qualify for a listing, other than as a SPAC, pursuant to the
main board listing criteria of the JSE (“Viable Assets”).
1.2. It is the Board’s intention to pursue, in compliance with the
Listings Requirements pertaining to a SPAC, a strategy of
investing in Viable Assets within the infrastructure and
renewable energy sectors, with stable, long-term inflation
linked returns for investors.
1.3. In accordance with its investment policy as stipulated in
paragraph 4.3 below, the Company is targeting investments in
Viable Assets with a benchmark gross investment return on
initial investments of CPI plus 6% and is targeting a
subsequent dividend distribution rate of CPI plus 2.5%. The
Company believes the inflation-linkage inherent in the
infrastructure sector, and offered by Gaia’s investment
returns, will be attractive to investors.
1.4. In anticipation of the Listing, Gaia intends to raise a
minimum of R500 000 000 by way of an offer to a limited
number of specifically selected and invited investors in
South Africa (“the Private Placement”) to whom the Private
Placement will be addressed (“Invited Investors”) to
subscribe for the ordinary shares with no par value in the
Company (“Private Placement Shares”) at a price of R10 per
Private Placement Share (“Issue Price”).
1.5. Gaia has been granted a listing of all its ordinary shares on
the main board of the JSE with effect from the commencement
of trade on Thursday, 12 November 2015, subject to the
Company raising the minimum amount of R500 000 000 in terms
of the Private Placement and the Company meeting the spread
requirements of the JSE (“Listing”).
1.6. The abridged Pre-listing Statement appearing below is not an
invitation to the public to subscribe for securities, but is
issued in compliance with the Listings Requirements, for the
purpose of providing information to the public with regard to
the Company.
2. DISTRIBUTION OF PRE-LISTING STATEMENT
2.1. Gaia will today distribute a pre-listing statement to Invited
Investors regarding the Listing and Private Placement
containing detailed information regarding the Company (“Pre-
listing Statement”). The Pre-listing Statement is available
on the Company’s website at www.gaiaip.com.
2.2. Terms appearing in title case in this announcement and that
are not otherwise defined herein, shall bear the meanings
assigned to them in the Pre-listing Statement.
3. SALIENT DATES AND TIMES RELATING TO THE LISTING AND PRIVATE
PLACEMENT
The salient dates and times relating to the Listing and Private
Placement are set out below:
2015
Abridged Pre-listing Statement Monday, 2 November
published on SENS on
Pre-listing Statement distributed on Monday, 2 November
Abridged Pre-listing Statement Tuesday, 3 November
published in the press on
Opening Date of the Private Wednesday, 4 November
Placement at 09:00 on
Closing Date of the Private Friday, 6 November
Placement at 12:00 2 on
Results of the Private Placement Monday, 9 November
published on SENS on
Results of the Private Placement Tuesday, 10 November
published in the press on
Notification of allotments to Tuesday, 10 November
successful Invited Investors by
Listing of Shares on the JSE Thursday, 12 November
expected at commencement of trade on
Accounts at CSDPs/Brokers updated in Thursday, 12 November
respect of Dematerialised
Shareholders on
Notes:
- All references to dates and times are to local dates and
times in South Africa. These dates and times are subject to
amendment. Any such amendment will be released on SENS.
- Invited Investors must advise their CSDP or Broker of their
acceptance of the Private Placement in the manner and cut-
off time stipulated by their CSDP or Broker.
- CSDPs effect payment on a delivery-versus-payment basis.
4. ABRIDGED PRE-LISTING STATEMENT OF GAIA
4.1. BRIEF OVERVIEW OF GAIA
Gaia Infrastructure Partners Proprietary Limited (“the
Manager”) was formed and incorporated in Cape Town, South
Africa, in 2012, by PB Schabort and L de Wit (“Founders”) for
the purpose of facilitating the investment of long-term
capital in infrastructure projects in Southern Africa, with
an initial focus on the renewable energy sector. The focus
has subsequently been broadened to other infrastructure
sectors. The Manager intends to introduce Gaia to the public,
to facilitate exposure to investments in infrastructure in
Southern Africa. The Board is responsible for Gaia’s
objectives and its business and investment strategies as well
as its overall supervision. Gaia has however outsourced the
identification and assessment of Viable Assets, as well as
the structuring and implementation of the acquisition and
potential disposal of Viable Assets (which acquisitions and
disposals must be approved by the Company), to the Manager in
terms of a management agreement.
4.2. INVESTMENT STRATEGY
4.2.1. Gaia aims to be a diversified infrastructure investment
company, and will directly invest in large-scale energy,
transport and water related infrastructure projects (being
projects with a value in excess of R1 billion) in a
responsible and transparent manner. In so doing, the
Company will provide investors with good, predictable,
inflation linked, liquid and long-term yielding
investments whilst providing investors with liquidity to
exit their investments. The Company will focus on making
investments in various infrastructure projects through
equity and debt instruments that meet the required
returns.
4.2.2. Gaia will initially look to invest in renewable energy
projects in South Africa through the Renewable Energy
Independent Power Producers Procurement Programme
currently managed by the Department of Energy of the
Republic of South Africa and will later seek to expand its
portfolio to include other sectors of infrastructure.
Although the Company’s primary focus will be in South
Africa, it may consider opportunities in the rest of
Africa.
4.2.3. Gaia will adhere to the United Nations backed Principles
for Responsible Investment and the Code for Responsible
Investing in South Africa.
4.2.4. The Manager has extensive expertise and knowledge of and
experience in investments in the infrastructure and
renewable energy sectors. The Manager will compile reports
based on its analysis of the relevant factors and will
present each proposed investment opportunity to the
Company. Following the Board’s in principle decision to
acquire a Viable Asset (and all subsequent investments),
the Manager shall ensure that the necessary due diligence
investigations are carried out and the Manager will be
responsible for negotiating the terms of investments. The
Board will at all times retain the final sanction over all
investment and divesture decisions.
4.3. INVESTMENT POLICY
Gaia will aim to meet the following investment criteria:
4.3.1. it will invest in operational or near operational
projects, being projects not more than 6 months from
operation;
4.3.2. it will target investments which will generate returns of
CPI plus 6%;
4.3.3. investments with visible environmental, social and
governance policy appreciation;
4.3.4. it will target investments with low risk and attractive
long-term inflation-linked predictable cash generation
profile;
4.3.5. it will make investments of not less than R200 000 000 per
investment in the case where the assets have not been
evaluated previously; and investments of not less than
R100 000 000 per investment in the case where the assets
have been evaluated previously;
4.3.6. it will strive to ensure management value add and
directorship roles to further optimise the underlying
assets;
4.3.7. it will target investments in underlying projects which
have a strong and well aligned management team with clear
operational and corporate strategies;
4.3.8. it will acquire a minimum of 15% equity interest, with
minority protections; and
4.3.9. it will make investments with acceptable third party
credit risk exposure.
4.4. JSE APPROVAL OF THE ACQUISITION OF VIABLE ASSETS
4.4.1. In terms of paragraph 4.35 of the Listings Requirements,
the acquisition of Viable Assets must be approved by a
majority of disinterested directors and the majority of
the Shareholders at a general meeting.
4.4.2. In the event that not all of the capital raised from the
Private Placement is utilised for purposes of the
acquisition of Viable Assets, Shareholders will be
requested to approve a further resolution at the same
general meeting dealing with the further use and retention
of the balance of the capital (“Residual Capital”) after
the acquisition of Viable Assets has been approved.
4.4.3. Gaia will initially be listed as a SPAC in the “Non Equity
Investment Instruments” sector of the main board of the
JSE. Following the acquisition of Viable Assets, Gaia will
be reclassified into the appropriate sector.
4.4.4. In terms of the Listings Requirements and subject to any
extension granted by the JSE, should the Company not
complete an acquisition of Viable Assets within 24 months
of the Listing Date, the JSE will suspend Gaia’s Listing
on the JSE. The JSE will proceed to delist the Company
once the Company has:
4.4.4.1. completed a distribution of the funds held in escrow by
the Escrow Agent, less outstanding operating expenses,
within 60 days after the expiry of the aforementioned
24 month period, to all Shareholders pro rata to their
shareholdings. Such distribution must comply with the
solvency and liquidity test as required pursuant to the
Companies Act. All interest earned in escrow will form
part of the distribution, excluding any taxes and
expenses relating to the distribution and anticipated
voluntary liquidation; and
4.4.4.2. proposed a special resolution to its shareholders, and
same having been adopted by the requisite number of
Shareholders, for the voluntary liquidation of the
Company.
4.5. PURPOSE OF THE PRIVATE PLACEMENT AND THE LISTING
4.5.1. The main purpose of the Private Placement and the Listing
is to:
4.5.1.1. provide investors, both institutional and retail, with
an opportunity to participate over the long-term in the
capital growth and the income streams of the Company;
4.5.1.2. create an avenue for investors to invest in
infrastructure projects in Southern Africa, usually only
accessed through private equity, which has limitations
on liquidity;
4.5.1.3. enhance the liquidity and tradability of the ordinary
shares of the Company;
4.5.1.4. provide the Company with a platform to raise equity
funding and debt to pursue growth and investment
opportunities;
4.5.1.5. provide the Company with the ability to use its listed
ordinary shares to fund future acquisitions;
4.5.1.6. establish the Company as a leader in its industry; and
4.5.1.7. enhance the public profile and general public awareness
of Gaia.
4.5.2. The proceeds of the Private Placement will be used by the
Company to fund the acquisition of Viable Assets.
4.6. PROSPECTS
4.6.1. Infrastructure as an asset class is one that requires
capital to develop. The South African government does not
have the funding required to meet its infrastructure
needs. In order to fulfil its development mandate, the
Government must partner with the private sector.
4.6.2. Accordingly, the Board believe that Gaia has excellent
prospects on the basis of the various potential Viable
Assets that the Manager has identified which are at
different stages of due diligence investigations and
negotiations, additional transactions in the pipeline,
current market conditions, the Government’s need for
private partners and access to future deal flow, which the
Board believe will provide returns in line with the
Company’s investment return expectations and targets
detailed above.
4.7. MANAGEMENT OF GAIA
4.7.1. The management function of Gaia is outsourced on market
related terms to the Manager. Salient details relating to
the Manager and the Management Agreement are set out in
Annexure 7 of the Pre-listing Statement.
4.7.2. The Board, as a whole, considered and approved the terms
and conditions of the Management Agreement prior to Gaia
entering into same. The independent directors of Gaia
shall perform an annual review of the Manager’s
performance and, if required, make appropriate
recommendations to Shareholders. The services to be
provided by the Manager are listed and set out in Annexure
A to the Management Agreement. These services are
objective criteria against which the Manager will be
evaluated. In addition, the Board will assess the
performance of the Manager based on the quality of the
Viable Assets identified and investments made by Gaia, as
well as the return on such investments to Shareholders. If
poor investments result in poor returns to Shareholders,
the independent Board may make appropriate recommendations
to Shareholders to terminate the Management Agreement.
4.8. DIVIDEND POLICY
The Board does not intend to declare any dividends prior to
the completion of an acquisition of Viable Assets.
Thereafter, subject to section 46 of the Companies Act, the
Company’s targeted annualised dividend distribution rate
shall be CPI plus 2.5%, which distribution rate shall be
calculated with reference to the Company’s net asset value as
set out in the most recent annual financial statements of the
Company.
4.9. PRIVATE PLACEMENT
4.9.1. Pursuant to the Private Placement, the Company intends to
raise a minimum of R500 000 000 by way of an offer for
subscription to Invited Investors of a minimum of
50 000 000 Private Placement Shares in the Company at the
Issue Price.
4.9.2. The Private Placement Shares issued in terms of this Pre-
listing Statement will be allotted subject to the
provisions of the MOI and will rank pari passu in all
respects including distributions, with all existing issued
Shares in the Company.
4.9.3. The Private Placement Shares will only be issued in
dematerialised form. No certificated Private Placement
Shares will be issued.
4.9.4. The directors in their sole discretion are entitled to
increase the number of Private Placement Shares offered in
terms of the Private Placement and the quantum sought to
be raised.
4.9.5. The directors in their sole discretion are entitled to
amend the terms of the Private Placement, provided that
any such amendments shall be advised to Invited Investors.
4.9.6. Interested parties can contact Willie Honeyball at PSG
Capital on 021 887 9602 or willieh@psgcapital.com.
4.10. CONDITION TO THE LISTING
The Listing is subject to:
4.10.1. Gaia raising a minimum amount of R500 000 000 in terms of
the Private Placement; and
4.10.2. the achievement of a spread of Shareholders acceptable to
the JSE, being public shareholders (as contemplated in the
Listings Requirements) holding not less than 20% of the
issued share capital of the Company to ensure reasonable
liquidity.
If any condition precedent fails, the Private Placement and
any acceptance thereof shall not be of any force or effect
and no person shall have any claim whatsoever against Gaia or
any other person as a result of the failure of any condition.
4.11. LISTING ON JSE
4.11.1. Prior to the Private Placement and the Listing, Gaia does
not have any shares listed on any stock exchange.
4.11.2. Subject to raising the minimum amount contemplated in
paragraph 11 of the Pre-listing Statement and the
achievement of a spread of public shareholders (as
contemplated in the Listings Requirements) acceptable to
the JSE, being public shareholders holding not less than
20% of the issued share capital of the Company, the JSE
has granted Gaia approval for the listing of a minimum of
50 001 000 Shares with effect from the commencement of
business on Thursday, 12 November 2015 in the “Non Equity
Investment Instruments” sector of the JSE under the
abbreviated name “Gaia”, JSE share code: GAI and ISIN:
ZAE000210555. As at the Last Practical Date, the Company
expects to meet the relevant spread requirement after the
Private Placement. Accordingly, it is anticipated that the
Listing will be effective as from the commencement of
trade of the JSE on Thursday, 12 November 2015.
4.12. SHARE CAPITAL
4.12.1. The authorised and issued share capital of Gaia as at the
Last Practicable Date was as follows:
R
Stated capital
Authorised
6 000 000 000 ordinary shares with no -
par value
Issued
1 000 ordinary shares with no par value 100
issued at R0.10
Total 100
Note:
- As at the Last Practicable Date, no Shares were held in
treasury.
4.12.2. Assuming that 50 000 000 Private Placement Shares have
been subscribed for, the authorised and issued share
capital of the Company after the Private Placement and
Listing is expected to be as follows:
R
Stated capital
Authorised
6 000 000 000 ordinary shares with no -
par value
Issued
50 001 000 ordinary shares with no par 500 000 100
value
Total 500 000 100
Notes:
- As at the time of the Listing, no Shares will be held
in treasury.
- The table in paragraph 4.12.2 of this announcement
assumes that 50 000 000 Private Placement Shares has
been subscribed for in terms of the Private Placement.
4.13. COMPOSITION OF THE BOARD
4.13.1. The full names, ages, business address and designations of
the directors of Gaia are provided below:
Full Name Age Designation Business Address
JR 33 Managing 2nd Floor, Oakdale House,
Oliphant Director The Oval, Oakdale Road,
Newlands, Cape Town,
South Africa
MM 44 Executive 2nd Floor, Oakdale House,
Nieuwoudt Director The Oval, Oakdale Road,
Newlands, Cape Town,
South Africa
T Soudien- 38 Financial 2nd Floor, Oakdale House,
Witten Director The Oval, Oakdale Road,
Newlands, Cape Town,
South Africa
L de Wit 60 Non- 2nd Floor, Oakdale House,
executive The Oval, Oakdale Road,
chairman Newlands, Cape Town,
South Africa
PB 57 Non- 2nd Floor, Oakdale House,
Schabort executive The Oval, Oakdale Road,
Director Newlands, Cape Town,
South Africa
C Ferreira 63 Non- 2nd floor, Katherine and
executive West, 114 West Street,
Director Sandown, Sandton, 2146
RB 49 Independent 1006 T Knightsbridge
Makhubela non- Apartments, Century
executive City, Cape Town, 7441
Director
KP Lebina 34 Lead 58 Cowley Road,
independent Bryanston, Johannesburg,
non- 2191
executive
Director
N Kimber 43 Independent 42 Smits Road, Dunkeld,
non- Johannesburg, 2196
executive
Director
KE Mbalo 52 Independent 59 Glanville Crescent,
non- Wendywood, Sandton, 2144
executive
Director
Notes:
- L de Wit is also a Founder of the Gaia Infrastructure
Partners; and
- PB Schabort is also a Founder of the Gaia
Infrastructure Partners.
5. COPIES OF THE PRE-LISTING STATEMENT
5.1. Copies of the Pre-listing Statement are available in English
only and may be obtained and are available for inspection
during normal office hours from 2 November 2015 until
12 November 2015 at the registered office of Gaia at 2nd
Floor, Oakdale House, The Oval, 1 Oakdale Road, Claremont,
7700 and at the offices of Gaia’s sponsor, PSG Capital
Proprietary Limited, at 1st Floor, Ou Kollege, 35 Kerk
Street, Stellenbosch, 7600 and 1st Floor, Building 8, Inanda
Greens Business Park, 54 Wierda Road West, Wierda Valley,
Sandton, 2196.
5.2. The Pre-listing Statement is also available on the Company’s
website at www.gaiaip.com.
Cape Town
2 November 2015
PSG Capital Proprietary Limited: Corporate advisor, sponsor and
bookrunner
KPMG Inc.: Auditors and Independent Reporting Accountants
Edward Nathan Sonnenbergs Incorporated: Attorneys
Date: 02/11/2015 03:20:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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