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Rights offer finalisation announcement
Life Healthcare Group Holdings Limited
Incorporated in the Republic of South Africa
Registration Number: 2003/002733/06
ISIN: ZAE000145892 Share Code: LHC
("Life Healthcare" or the "Company")
NOT FOR PUBLICATION, DISTRIBUTION OR RELEASE, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED
STATES,AUSTRALIA,CANADA OR JAPAN.THIS ANNOUNCEMENT DOES NOT CONSTITUTE OR FORM AN OFFER
OF SECURITIES IN THE UNITED STATES OR ANY OTHER JURISDICTION.
RIGHTS OFFER FINALISATION ANNOUNCEMENT
1. Introduction
Life Healthcare shareholders are referred to the rights offer declaration announcement released on the Stock Exchange News
Service ("SENS") on 16 March 2017, relating to a renounceable rights offer to qualifying Life Healthcare shareholders (the
"Rights Offer").
The terms of the Rights Offer have now been finalised and all conditions precedent to the Rights Offer have been fulfilled.
2. Terms of the Rights Offer
Life Healthcare shareholders are advised that the board of directors of Life Healthcare has resolved to raise R9 billion through
the Rights Offer.
The Rights Offer will consist of an offer of 367,346,939 new Life Healthcare ordinary shares in the ratio of 34.21659 new Life
Healthcare ordinary shares for every 100 Life Healthcare ordinary shares held on the record date of the Rights Offer, being
Friday, 31 March 2017, at an issue price of R24.50 per Life Healthcare ordinary share. The ordinary shares issued pursuant
to the Rights Offer are expected to constitute 25.49% of Life Healthcare’s post-Rights Offer share capital.
Brimstone Investment Corporation Limited ("Brimstone") and Allan Gray Proprietary Limited ("Allan Gray"), acting for and on
behalf of its clients, have each entered into irrevocable undertakings in favour of the Company to subscribe for some or all of
the Life Healthcare ordinary shares to which they are entitled pursuant to their rights under the Rights Offer. The holdings
represented by these undertakings equate to 21.2% of Life Healthcare ordinary shares; Brimstone controls 4.7% and Allan
Gray’s clients are the beneficial owners of, or otherwise directly or indirectly control, 16.5% of those Life Healthcare ordinary
shares.
The balance of the Rights Offer is underwritten by Rand Merchant Bank (a division of FirstRand Bank Limited) and Absa
Bank Limited (acting through its Corporate and Investment Banking division) (together, the "Joint Bookrunners").
3. Salient dates and times of the Rights Offer
The final salient dates and times for the Rights Offer are set out below:
2017
Last day of dealings to acquire Life Healthcare ordinary shares (cum rights) in order to qualify to
participate in the Rights Offer on Tuesday, 28 March
Life Healthcare ordinary shares commence trading ex rights on the exchange operated by the
JSE Limited ("JSE") at 09h00 on Wednesday, 29 March
Listing of and trading in the letters of allocation commences under JSE code LHCN and ISIN
ZAE000239976 at 09h00 on Wednesday, 29 March
Rights Offer circular and form of instruction (where applicable) posted to qualifying, certificated
Life Healthcare shareholders on Thursday, 30 March
Record date for purposes of determining the Life Healthcare shareholders entitled to participate
in the Rights Offer, at the close of business on Friday, 31 March
Rights Offer opens at 09h00 on Monday, 3 April
In respect of qualifying certificated Life Healthcare shareholders, letters of allocation credited to
an electronic account held with the transfer secretaries at 09h00 on Monday, 3 April
In respect of qualifying dematerialised Life Healthcare shareholders, CSDP or broker accounts
credited with letters of allocation at 09h00 on Monday, 3 April
Rights Offer circular, where applicable, posted to qualifying dematerialised Life Healthcare
shareholders on Tuesday, 4 April
Last day to trade in letters of allocation in order to participate in the Rights Offer on Monday, 10 April
Listing of Rights Offer shares on the exchange operated by the JSE at 09h00 on Tuesday, 11 April
In respect of qualifying certificated Life Healthcare shareholders (or their renouncees) wishing to
exercise all or some of their rights, payment to be made and forms of instruction to be lodged Thursday, 13 April
with the transfer secretaries by 12h00 on
Rights Offer closes at 12h00 on Thursday,13 April
Record date for letters of allocation on Thursday, 13 April
Rights Offer shares issued on Tuesday, 18 April
In respect of qualifying dematerialised Life Healthcare shareholders (or their renouncees), CSDP
or broker accounts debited with the aggregate Rights Offer price and updated with Rights Offer Tuesday, 18 April
shares at 09h00 on
In respect of qualifying certificated Life Healthcare shareholders (or their renouncees), share
certificates in respect of Rights Offer shares posted by registered post on or about Tuesday, 18 April
Results of the Rights Offer released on SENS on Tuesday, 18 April
In respect of successful excess applications (if applicable), Rights Offer shares issued to
qualifying dematerialised Life Healthcare shareholders and/or share certificates posted to
qualifying certificated Life Healthcare shareholders on or about Thursday, 20 April
In respect of unsuccessful excess applications (if applicable), refund cheques posted to
qualifying certificated Life Healthcare shareholders on or about Thursday, 20 April
Notes:
1. All times referred to in the announcement are local times in South Africa.
2. Qualifying dematerialised Life Healthcare shareholders (or their renouncees) will have their accounts at their CSDP automatically
credited with their rights.
3. CSDPs effect payment in respect of dematerialised Life Healthcare shareholders (or their renouncees) on a delivery versus
payment basis.
4. Holders of dematerialised Life Healthcare ordinary 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 their custody agreements.
5. Qualifying certificated Life Healthcare shareholders (or their renouncees) will have their rights credited to an account with the
transfer secretaries.
6. Life Healthcare share certificates may not be dematerialised or rematerialised between 29 March 2017 and 31 March 2017, both
days inclusive.
7. Share certificates will be posted at the risk of the qualifying certificated Life Healthcare shareholders (or their renouncees).
8. Any material changes to the dates and times above will be released on SENS.
4. Rights Offer circular
The Rights Offer circular and a form of instruction in respect of a letter of allocation will be distributed to qualifying certificated
Life Healthcare shareholders on or about Thursday, 30 March 2017. The Rights Offer circular will be distributed to qualifying
dematerialised Life Healthcare shareholders registered on the record date for the Rights Offer on or about Tuesday, 4 April
2017.
The Circular will also be available on the website of the Company (www.lifehealthcare.co.za) from Tuesday, 28 March 2017.
5. Current trading and prospects
Trading since 30 September 2016 has been below Life Healthcare’s expectations and below last year’s trading, excluding the
impact of Alliance Medical Group Limited ("Alliance Medical"), during the corresponding period.
- Trading in the southern African hospital division has been below Life Healthcare’s expectations primarily due to a
reduction in PPDs. The PPDs to end February 2017 were lower than the corresponding period by 2.7%. This was
due to limited or no growth in the private healthcare market, a greater than expected slowdown in the South African
economy, an increase in active case management by medical aids away from hospital admissions and doctors
taking more and longer leave than anticipated. These factors have resulted in a reduction in admissions for elective
procedures.
- Trading in the healthcare services division has been in line with Life Healthcare’s expectations but below last year
due to the termination of the Life Esidimeni Gauteng mental health contracts in June 2016.
- Trading in the international division has been in line with Life Healthcare’s expectations for both Alliance Medical
and Scanmed S.A. The Company is currently reviewing the impact of further cardiology tariff reductions that became
effective on 1 January 2017 in Poland.
The Company’s results have been negatively impacted by the additional financing cost related to the acquisition of Alliance
Medical and the related transaction costs.
The financing and transaction costs mentioned above are expected to have the greatest impact on the financial results. There
are further exceptional items which are subject to greater volatility than the trading conditions and the Company expects to
have better clarity on the impact of both on the results when the March 2017 numbers are finalised.
Any reference to current or future financial performance in this announcement has not been reviewed and reported on by the
Company’s auditors.
Illovo
23 March 2017
Joint bookrunner, joint underwriter and sponsor
Rand Merchant Bank (A division of FirstRand Bank Limited)
Joint bookrunner and joint underwriter
Absa Bank Limited (acting through its Corporate and Investment Banking division)
International and South African legal counsel to Life Healthcare
Allen & Overy LLP
International legal counsel to the joint underwriters
Linklaters LLP
South African legal counsel to the joint underwriters
Webber Wentzel
Important Notice
The information contained herein is not for release, publication or distribution, directly or indirectly, in or into the United States,
its territories or possessions, Canada, Australia or Japan or any other jurisdiction in which the distribution or release would be
unlawful. These materials are not and do not contain an offer of securities for sale or a solicitation of an offer to purchase or
subscribe for securities in any jurisdiction, including the United States, Australia, Canada or Japan or any other state or
jurisdiction in which such release, publication or distribution would be unlawful. The securities to which these materials relate
(the "Securities") have not been, and will not be, registered under the U.S. Securities Act of 1933, as amended (the "Securities
Act"), and may not be offered or sold in the United States unless registered under the Securities Act or pursuant to an
exemption from, or in a transaction not subject to, registration under the Securities Act. There will be no public offer of the
Securities in the United States. Subject to certain exceptions, the Securities may not be offered or sold in Australia, Canada
or Japan or to, or for the account or benefit of, any national, resident or citizen of such countries.
These materials are only being distributed to and are only directed at: (i) persons who are outside the United Kingdom; or (ii)
to investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion)
Order 2005 (the “Order”); or (iii) high net worth entities, and other persons to whom it may lawfully be communicated, falling
within Article 49(2) of the Order; or (iv) persons to whom an invitation or inducement to engage in investment activity (within
the meaning of section 21 of the Financial Services and Markets Act 2000) in connection with the issue or sale of any securities
may otherwise lawfully be communicated; or (v) persons to whom it may otherwise lawfully be communicated (all such persons
together being referred to as "relevant persons"). The Securities are only available to, and any invitation, offer or agreement
to subscribe, purchase or otherwise acquire such securities will be engaged in only with, relevant persons. Any person who is
not a relevant person should not act or rely on this announcement or any of its contents.
In any member state of the European Economic Area (other than the United Kingdom) that has implemented Directive
2003/71/EC (and amendments thereto, including Directive 2010/73/EU to the extent implemented in the relevant Member
State, together with any applicable implementing measures in any Member State, the "Prospectus Directive") this
announcement is only addressed to and is only directed at qualified investors in that Member State within the meaning of the
Prospectus Directive.
These materials do not constitute or form a part of any offer or solicitation or advertisement to purchase and/or subscribe for
Securities in South Africa, including an offer to the public for the sale of, or subscription for, or the solicitation or advertisement
of an offer to buy and/or subscribe for, shares as defined in the South African Companies Act, No. 71 of 2008 (as amended)
or otherwise (the "Act") and will not be distributed to any person in South Africa in any manner that could be construed as an
offer to the public in terms of the Act. These materials do not constitute a prospectus registered and/or issued in terms of the
Act. Nothing in this announcement should be viewed, or construed, as “advice”, as that term is used in the South African
Financial Markets Act, No. 19 of 2012, as amended, and/or Financial Advisory and Intermediary Services Act, No. 37 of 2002,
as amended.
The contents of this announcement have not been verified by the Joint Bookrunners in connection with the Rights Offer or any
of their respective affiliates (together, the "Banks"). The Banks are each acting exclusively for Life Healthcare and for no-one
else in connection with any transaction mentioned in these materials and will not regard any other person (whether or not a
recipient of this announcement) as a client in relation to any such transaction and will not be responsible to any other person
for providing the protections afforded to their respective clients, or for advising any such person on the contents of these
materials or in connection with any transaction referred to in this announcement.
No reliance may be placed for any purposes whatsoever on the information contained in this announcement or on its accuracy
or completeness. No representation or warranty, expressed or implied, is given by or on behalf of Life Healthcare, the Banks
or their respective affiliates, directors, officers or employees, advisors or any other person as to the accuracy or completeness
of the information or opinions contained in this announcement, and no liability whatsoever is accepted for any such information
or opinions or any use which may be made of them.
Persons receiving this announcement should make all trading and investment decisions in reliance on their own judgement
and not in reliance on the Banks or this document. None of the Banks is providing any such persons with advice on the
suitability of the matters set out in this announcement or otherwise providing them with any investment advice or personal
recommendations. Any presentations, research or other information communicated or otherwise made available in this
document is incidental to the provision of services by the Banks to Life Healthcare and is not based on individual
circumstances.
All investment is subject to risk. The value of the securities offered may go down as well as up. Past performance is no
guarantee of future returns. Potential investors are advised to seek expert financial advice before making any investment
decision.
Forward-Looking Statements
This announcement includes certain forward-looking statements, beliefs or opinions, including statements with respect to Life
Healthcare’s business, financial condition, results of operations and prospects. Forward-looking statements are typically
identified by the use of forward looking terminology such as "believes", "expects", "may", "will", "could", "should", "intends",
"estimates", "plans", "assumes", "anticipates", "annualized", "goal", "target" or "aim" or the negative thereof or other variations
thereof or comparable terminology, or by discussions of strategy that involve risk and uncertainties. These statements reflect
the directors' beliefs and expectations and involve risk and uncertainty because they relate to events and depend on
circumstances that will occur in the future. No representation is made that any of these statements or forecasts will come to
pass or that any forecast results will be achieved. There are a number of risks, uncertainties and factors that could cause
actual results and developments to differ materially from those expressed or implied by these statements and forecasts. Past
performance cannot be relied on as a guide to future performance. Forward-looking statements speak only as at the date of
this announcement, and Life Healthcare expressly disclaims any obligations or undertaking to release any update of, or
revisions to, any forward-looking statements in this announcement. No statement in this announcement is intended to be a
profit forecast. As a result, you are cautioned not to place any undue reliance on such forward-looking statements. Please
refer to the Life Healthcare’s Integrated Report for the financial year ended 30 September 2016 for a description of certain
important factors, risks and uncertainties that may affect Life Healthcare’s businesses.
Date: 23/03/2017 12:08:00 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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