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Sale of the Donkerhoek business, transfer of mining right and cautionary announcement
Brikor Limited
(Incorporated in the Republic of South Africa)
(Registration number 1998/013247/06)
Share code: BIK ISIN: ZAE000101945
(“Brikor” or “the Company”)
SALE OF THE DONKERHOEK BUSINESS, TRANSFER OF MINING RIGHT AND
CAUTIONARY ANNOUNCEMENT
1. INTRODUCTION
Shareholders are advised that Brikor (“the Seller”) has accepted an offer on 8 September 2017
and is to enter into a sale agreement (“Agreement”) with Vibro Bricks and Paving (Pty) Limited
(“Vibro”) (“the Purchaser”) for the sale and purchase of the Donkerhoek Business as described
in 3.2 below (“the Transaction”).
2. BACKGROUND AND RATIONALE FOR THE TRANSACTION
The Donkerhoek Business produces aggregates of a wide variety of sizes and technical
specifications with products including stone, gravel and sand for large- and small-scale civil
engineering as well as infrastructure projects.
The Donkerhoek Business has been identified as a non –core business and management has
made a decision to dispose of it to focus on its core business of brick making and coal.
3. TERMS AND CONDITIONS OF THE TRANSACTION
3.1. Brikor will enter into an Agreement to sell the Donkerhoek Business to Vibro as a going
concern.
3.2. The Donkerhoek Business includes:
- the immovable properties described as:
- Portion 87 (a portion of portion 34) of the Farm Donkerhoek 365: in extent
22, 3383 hectares;
- Portion 114 ( a portion of portion 5) of the Farm Donkerhoek 365: in extent
21, 8048 hectares;
- Portion 115 (a portion of portion 5) of the Farm Donkerhoek 365 : in extent
21, 8419 hectares;
- Portion 116 (a portion of portion 5) of the Farm Donkerhoek 365: in extent
21, 8410 hectares
collectively known as the “immovable properties”.
- the fixed assets relating to the Donkerhoek Business;
- the stock relating to the Donkerhoek Business;
- the goodwill relating to the Donkerhoek Business;
- certain assumed liabilities;
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- the shares and claims of Donkerhoek Quartzite (Pty) Ltd (“Donkerhoek
Quartzite”), a wholly owned subsidiary of Brikor, including the transfer of the
mining right GP30/5/1/2/2 (232) MR;
- the rights and obligations in terms of certain contracts; and
- the trade names relating to the Donkerhoek Business;
but excluding defined certain fixed assets, debtors, creditors, cash and environmental
and rehabilitation liabilities associated with the mining right .
3.3. The purchase consideration payable by the Purchaser to the Seller for the Transaction
shall be an amount of R 50 248 371 exclusive of VAT, R10 million of which will be payable
on the date of transfer of the immovable properties and the balance of the fulfilment or
waiver of the below conditions precedent. The Purchaser has undertaken to replace the
current rehabilitation guarantee to the value of R 4 501 629.
3.4. The Transaction is subject to the following conditions precedent:
3.4.1. within 30 days after signature date, the Purchaser shall deliver to the Seller
a bank approval letter to the satisfaction of the Seller, indicating that the
financing of the purchase price has been approved;
3.4.2. within 30 days after fulfilment of the above condition in 3.4.1 above, the
Purchaser shall deliver to the Seller an acceptable bank guarantee for the
purchase consideration;
3.4.3. within 90 days after signature date, the shareholders of Brikor have to pass
a special resolution required in terms of Section 112 of the Companies Act
No. 61 of 1973, as amended; and
3.4.4. within 45 days after the signature date, the Purchaser has to conduct a
due diligence investigation to its satisfaction.
3.5. The sale of the shares in Donkerhoek Quartzite is subject to Ministerial consent by the
Minister of Mineral Resources in terms of Section 11(1) of the Mineral and Petroleum
Resources Development Act, 28 of 2002 to transfer the shares in Donkerhoek
Quartzite.
3.6. The seller gave certain warranties that are customary in a transaction of this nature.
3.7. The effective date of the Transaction is the date of registration of the immovable properties
and payment of the purchase price.
4. USE OF PROCEEDS
The Transaction proceeds will be used for repayment of debt and working capital.
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5. FINANCIAL INFORMATION IN RESPECT OF THE TRANSACTION
The value of the net assets subject to the Transaction was R45, 1 million as at 28 February
2017. The loss attributable to the net assets that are subject to the Transaction was R25, 5
million for the year ended 28 February 2017.
6. CATEGORISATION OF THE TRANSACTION
The Company is currently in discussions with the JSE regarding the categorisation of the
Transaction, given the suspension of its shares. Once the categorisation of the Transaction
has been determined, shareholders will be notified thereof.
7. CAUTIONARY ANNOUNCEMENT
Shareholders are advised to exercise caution in dealing in the Company’s securities on the
JSE until such time as the categorisation of the Transaction is determined.
Exchange Sponsors
12 September 2017
Brikor
Nigel
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