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Supplementary Circular relating to the Acquisition of RTG
LABAT AFRICA LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1986/001616/06)
(“Labat” or “the Company”)
ISIN Code: ZAE 000018354 Share code: LAB
SUPPLEMENTARY CIRCULAR RELATING TO THE ACQUISITION OF REINHARDT TRANSPORT
GROUP PROPRIETARY LIMITED (“RTG”)
Shareholders are referred to the announcements released on SENS on
12 November 2015 as well as the circular dated 18 November 2015 (“November
Circular”), in which Shareholders were advised that the Company has concluded a
subscription and buy-back agreement, and addendums thereto, for the acquisition
of a 100% interest in RTG for a total consideration of R560 million to be financed
through a combination of debt and equity arrangements.
Further to the above, Shareholders are advised that the pro forma financial effects
that were contained in the November Circular have been revised as a result of the
accounting treatment of the fair value adjustment of the vendor loan at initial
recognition amounting to R32.350 million due to the deferred vendor consideration
not attracting interest being recognised as a fair value gain through the Statement
of Comprehensive Income as opposed to being applied as a reduction to the cost
of acquisition. This was due to the structure of the transaction being by way of a
cash subscription for new shares in RTG and then a share buy-back of shares in RTG
from the RTG Vendors.
On further investigation into the IFRS treatment, due to the integral nature of the
deferred vendor consideration to the purchase transaction and consideration
payable, the Company has been advised that it is more appropriate to apply the
R32.350 million gain against the cost of the investment, which has the effect of
reducing goodwill on consolidation. All other pro forma financial effects remain the
same as detailed in the November Circular.
The above change has resulted in a change of more than 10% from the previously
published pro forma financial effects and accordingly, in accordance with
paragraph 11.56 of the JSE Limited Listings Requirements, a supplementary circular
is required. Accordingly, the reporting accountant has withdrawn its report on the
pro forma financial effects as detailed in the November Circular and a new report
will be contained in the supplementary circular.
Shareholders are reminded that, save as disclosed above, there has been no
significant change and no significant new matter that has arisen since publication
of the November Circular.
Accordingly, the supplementary circular has been submitted to the JSE yesterday
morning and will be distributed to Shareholders as soon as practicable. The revised
pro forma financial effects will be published on SENS in due course.
Johannesburg
24 November 2015
Sponsor
Arbor Capital Sponsors Proprietary Limited
Date: 24/11/2015 08:04:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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