SUPER GROUP LIMITED - Acquisition of Fleet Hire by SG Fleet Group

Acquisition of Fleet Hire by SG Fleet Group

Super Group Limited
(Incorporated in the Republic of South Africa)
(Registration number: 1943/016107/06)
Share code: SPG
ISIN: ZAE000161832
(“Super Group”)

ACQUISITION OF FLEET HIRE BY SG FLEET GROUP

SG Fleet Group Limited (‘SG Fleet’ / ASX: SGF), a subsidiary of Super Group
Limited, has announced the acquisition of a UK company, Fleet Hire, a
provider of contract hire, salary sacrifice, short-term rental and fleet
management services (“the Acquisition”). The Acquisition gives SG Fleet
scale and a profitable growth platform in the UK market.

The salient details of the Acquisition are:

*   Fleet Hire is provider of contract hire, salary sacrifice, short-term
    rental and fleet management services
*   Normalised EBITDA £4.6m – Normalised PBT £2.0m
*   The Acquisition creates broader customer base for SG Fleet’s Novalease
    product, greater scale for corporate offering and profitable presence in
    short-term rental segment
*   Enterprise value £25.7m (acquisition price £19.6m plus lease portfolio
    debt net of cash of £6.1m) – 5.6x Normalised EBITDA
*   Anticipated 4.5% cash EPS accretion for SG Fleet in first full year of
    ownership


The acquisition provides SG Fleet with critical mass in the attractive UK
market and, in combination with its existing local business, creates a
profitable platform for continued growth.

Total value of the Acquisition is £25.7 million, comprised of a purchase
price of £19.6 million and lease portfolio debt net of cash of £6.1 million.
SG Fleet shares to the value of £1.8 million will be issued to the vendors,
with the remainder of the consideration to be funded through debt (£12.0
million) and cash on hand (£5.8 million).

SG Fleet expects cash EPS accretion in its first full year of ownership of
4.5%, with further accretion in subsequent years. The consideration paid
values Fleet Hire at 5.6-times normalised EBITDA, not including synergies
anticipated in procurement, premises, systems and operating costs. Exchange
and completion of the Acquisition is occurring simultaneously and
consolidation of SG Fleet UK with Fleet Hire will start immediately.

SG Fleet’s Chief Executive Officer, Robbie Blau, said: “Fleet Hire is an
ideal fit for our long-term growth strategy in the UK. The Acquisition meets
all the strict criteria we have set for ourselves in terms of valuation and
expansion of customer book and product range. Together with the invaluable
expertise we access by retaining the commitment of the company’s management
team, we have made a significant stride forward in this market.”

“Our Novalease product has already been very successful in disrupting the
local car salary sacrifice market and combining it with Fleet Hire’s broader
salary sacrifice offering gives us access to an additional customer base and
a more comprehensive solution for existing SG Fleet drivers. We will have a
more sizeable corporate offering, capable of servicing larger customers. Our
planned diversification into the high growth short-term rental segment will
also be accelerated,” Mr Blau noted.


Fleet Hire overview
Fleet Hire is headquartered near SG Fleet’s Solihull offices and employs 60
staff.

The company has been very successful at positioning itself as a ‘one stop’
provider of its full range of services and has seen continued organic growth
since its establishment, recently breaking into the UK market’s Top 25.
Fleet size stands at approximately 6,500 units.

It offers traditional corporate leasing for multi-year periods to
corporates, as well as Car Salary Exchange, its rapidly growing salary
sacrifice product.

Corporates accessing vehicles for temporary requirements are offered a
short-term rental solution, which has proven very successful nationally.
Fleet Hire also provides a range of fleet management services, stand-alone
or in combination with contract hire.

The company has a range of well-entrenched customers, from SMEs to large
listed entities and across various industries.

Fleet Hire’s management team, led by CEO Graham Hale, is highly regarded
within the industry and will remain with the consolidated entity.

SG Fleet’s long-term UK strategy on track
“We looked at this asset carefully for some time and tested the proposition
in the context of the UK’s current economic environment,” Mr Blau said. “We
have a clear view on our long-term outlook in the UK and have gone about
executing our plans in a very disciplined fashion.”

“With this acquisition, we make a leap forward in our strategic agenda here
and we establish ourselves as a recognised player in a number of segments.
Most importantly, we do so in a profitable manner and by gaining access to
additional local expertise. I am delighted we have been successful in
convincing the Fleet Hire team to join us and look forward to growing our
presence here further,” Mr Blau concluded.

The total value of the Acquisition is below the level of the JSE
categorisation requirements.

Further details on the Acquisition will be available on SG Fleet’s website
www.sgfleet.com from Friday 5 August 2016.


Sandton
4 August 2016

Sponsor: Deutsche Securities (SA) Proprietary Limited

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