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RAND MERCHANT INVESTMENT HOLDINGS LIMITED - Detailed cautionary announcement

Release Date: 13/03/2017 08:05
Code(s): RMI     PDF:  
Wrap Text
Detailed cautionary announcement

RAND MERCHANT INVESTMENT HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number: 2010/005770/06)
ISIN: ZAE000210688
JSE ordinary share code: RMI
("RMI" or “the Company”)

DETAILED CAUTIONARY ANNOUNCEMENT

1. Introduction

Shareholders are advised that RMI has entered into exclusive
negotiations with its 84% subsidiary, OUTsurance Holdings Limited
(“OUTsurance”), regarding the potential disposal by RMI of a 49%
interest in Main Street 1353 Proprietary Limited (“Main Street
1353”), to OUTsurance (“the Proposed Transaction”).

Main Street 1353, a wholly-owned subsidiary of RMI, holds a 29.9%
interest in Hastings Group Holdings plc (“Hastings”), which 29.9%
interest was acquired with effect from 1 March 2017 and per the
announcement released on the Stock Exchange News Service on 21
February 2017.

Rationale for the Proposed Transaction

The Proposed Transaction is consistent with RMI’s previously
articulated strategy. This strategy includes playing an active role
to optimise, diversify and modernise its investment portfolio
through investments across a broad spectrum of scale and lifecycles
of financial services businesses. The Proposed Transaction creates
enhanced alignment between RMI and OUTsurance through co-operation
and potential synergies that may be realised between Hastings and
OUTsurance.

Albeit in different markets, OUTsurance and Hastings employ similar
business models, specifically in relation to dynamic and analytical
approaches to risk underwriting and the use of modern direct
distribution channels. OUTsurance and Hastings have identified areas
of potential collaboration that may include the sharing of best
practices and learnings between the businesses, as appropriate.

2. Cautionary announcement

The Proposed Transaction remains subject, inter alia, to the
necessary terms being agreed, including key terms pertaining to
pricing, and to the requisite regulatory approvals being in place.
Shareholders are therefore advised to exercise caution when dealing
in the Company’s securities until a further announcement is made.


Sandton

13 March 2017

Merchant Bank and Sponsor
RAND MERCHANT BANK (A division of FirstRand Bank Limited)

Legal Adviser
Allen & Overy LLP

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