BELL EQUIPMENT LIMITED - Bell Equipment Sales South Africa Limited (BESSA) concludes Black Economic Empowerment (B-BBEE) Transaction

Bell Equipment Sales South Africa Limited (“BESSA”) concludes Black Economic Empowerment (“B-BBEE”) Transaction

BELL EQUIPMENT LIMITED
(Incorporated in the Republic of South Africa)
(Registration number: 1968/013656/06)
ISIN: ZAE0000 28304
Share Code: BEL
(“Bell” or “the Company”)


BELL EQUIPMENT SALES SOUTH AFRICA LIMITED (“BESSA”) CONCLUDES BLACK ECONOMIC
EMPOWERMENT (“B-BBEE”) TRANSACTION

Shareholders are referred to the Preliminary Audited results announcement for the year ended 31
December 2016 released on the Stock Exchange News Service (“SENS”) on 16 March 2016, which
mentioned that subsequent to year-end the board approved a B-BBEE ownership transaction for Bell
Equipment Sales South Africa Limited (BESSA), currently the Company’s wholly owned subsidiary.
BESSA provides sales and aftermarket support for Bell designed and manufactured products as well
as strategic alliance partner products in South Africa. A selected B-BBEE partner and a broad based
trust will acquire 22,5% and 7,5% respectively of the issued share capital of BESSA (“the
Transactions”). Agreements in respect of such Transactions have been signed by all the parties
thereto. After these Transactions are implemented (following the fulfillment or waiver of the
conditions precedent), BESSA will qualify as a 30% black women owned entity. The transactions have
been specifically structured to pursue transformation through the economic empowerment of black
women and also align the BESSA business strategy with government's economic transformation
policies.

     1) TRANSACTION STRUCTURE

      1.1 An entity that is 100% owned by or for the benefit of, and managed by black women,
          namely SIBI Capital Proprietary Limited (“SIBI”) (registration number - 2015/129176/07)
          represented by Bell independent non-executive director Bharti Harie and Sindiswe
          Ntombenhle Mabaso-Koyana, will acquire 22.5% of the issued share capital of BESSA
          through a subscription by a newly incorporated private ring-fenced company (“BEE SPV”).
          SIBI will be the sole ordinary shareholder of the BEE SPV.

      1.2 A broad based trust founded by Bell and known as the Bell Equipment Foundation (“BEF”),
          will subscribe for 7.5% of the issued ordinary share capital of BESSA. The beneficiaries of
          BEF will be black women.

      1.3 Upon implementation of the transactions, BESSA will be 30% owned by black women.

      1.4 The Transaction has been structured to:

            1.4.1   Create a sustainable funding structure that is not reliant on external finance; and

            1.4.2   Improve BESSA’s ownership score under the Revised Code of Good Practice
                    (RCoGP).


     2) CONSIDERATION

          BEE SPV subscription

      2.1 Prior to the BEE SPV subscribing for 22.5% of the ordinary shares in BESSA, the board of
          directors of BESSA shall declare an ordinary dividend of R340 281 000 to the Company, of
          which-

           2.1.1   R275 000 000 will be used by the Company to subscribe for cumulative
                   redeemable non-participating preference shares in BESSA;

           2.1.2   R65 281 000 will be advanced by the Company to BESSA as an interest free loan
                   repayable over 3 years.

     2.2 The consideration payable by the BEE SPV for 22.5% of the ordinary shares in BESSA is
         R2 077 500. The consideration is being funded by BESSA by way of loans to each of Ms
         Harie and Ms Ntombenhle Mabaso-Koyana, in the amount of R 1 038 750 each. They in
         turn will lend the amount of the loans made to them to the BEE SPV. These loans are
         repayable by Ms Harie and Ms Ntombenhle Mabaso-Koyana over 12 months and are
         interest free. The loans by Ms Harie and Ms Ntombenhle Mabaso-Koyana to the BEE SPV
         will only be repaid if and when the BEE SPV is in a financial position to do so.

         BEF Subscription

     2.3 BEF will subscribe for 7.5% of the ordinary shares in BESSA for R1 000.

     3) CONDITIONS PRECEDENT

     3.1 The implementation of the Transaction is subject to the fulfillment, or waiver, as the case
         may be, of the following conditions precedent:

           3.1.1   the acceptance and placing on file by the Companies and Intellectual Property
                   Commission of a new memorandum of incorporation for BESSA;

           3.1.2   the acceptance and placing on file by the Companies and Intellectual Property
                   Commission of a new memorandum of incorporation for the BEE SPV.




Richards Bay
05 April 2017

Sponsor
Investec Bank Limited

Date: 05/04/2017 04:00:00 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.