Wrap Text
Private Placement And Abridged Prospectus
STADIO HOLDINGS LIMITED
(Previously Embury Holdings Proprietary Limited)
(Incorporated in the Republic of South Africa)
Registration number: 2016/371398/06
JSE share code: SDO
ISIN ZAE000248662
(“STADIO”)
PRIVATE PLACEMENT AND ABRIDGED PROSPECTUS
Invited investors should refer to paragraph 6 below which sets out the
actions required by them with regards to the Private Placement (as
defined below).
1. INTRODUCTION
1.1. On 28 February 2017, Curro announced its intention to unbundle
its entire interest in STADIO and to list STADIO on the JSE.
STADIO was listed on the main board of the JSE, under the
abbreviated name “STADIO”, JSE share code “SDO” and ISIN
ZAE000248662, with effect from the commencement of trade on
Tuesday, 3 October 2017 (“Listing Date”) and the unbundling was
effected on Friday, 6 October 2017. STADIO is listed in the
“Specialised Consumer Services” sector of the Main Board of the
JSE.
1.2. STADIO intends to raise up to approximately R200 million through
a private placement by way of an offer to Brimstone Investment
Corporation Limited (“Brimstone”) and Black Persons (being natural
persons defined as Black People in the B-BBEE Act and the B-BBEE
Codes) that are invited to subscribe (“Invited Investors”) for
approximately 67 000 000 to 80 000 000 (but no more than
87 000 000) STADIO Shares (“Private Placement Shares”) at a price
(“Private Placement Issue Price”) per Private Placement Share
being the lower of R2.96 and the volume weighted average price of
a STADIO Share for the 30 trading day period after the Listing
Date, less a 20% discount (“Discounted Trading Price”), which will
be advised by PSG Capital to Invited Investors and will be
announced on SENS on Tuesday, 14 November 2017 (“Private
Placement”).
2. PUBLICATION AND DISTRIBUTION OF PROSPECTUS
2.1. The prospectus in relation to the Private Placement, which
contains detailed information regarding STADIO and the Private
Placement (“Prospectus”), was published today, Monday,
30 October 2017, and is available on STADIO’s website
(www.stadio.co.za).
2.2. The Prospectus, was registered by the Companies and Intellectual
Property Commission on 20 October 2017 in terms of the Companies
Act, No. 71 of 2008, as amended (“Companies Act”).
2.3. STADIO will distribute the Prospectus to Invited Investors on
Monday, 30 October 2017.
2.4. Terms appearing in title case in this announcement and that are
not otherwise defined herein, shall bear the meanings assigned to
them in the Prospectus. Invited Investors are referred to the
footnotes and references contained in the Prospectus for the
sources of the various statistics and facts contained in this
announcement.
3. SALIENT DATES AND TIMES RELATING TO PRIVATE PLACEMENT
The salient dates and times relating to the Private Placement are
set out below:
2017
Opening date of the Private Placement Monday, 30 October
(09:00)
Announcement of the Private Placement Tuesday, 14 November
Issue Price
Closing date of the Private Placement Monday, 27 November
(12:00)
Results of the Private Placement Wednesday, 29 November
released on SENS on
Notification of allotments to Wednesday, 29 November
successful Invited Investors by
Results of the Private Placement Thursday, 30 November
published in the press on
Accounts at CSDP or Broker updated Monday, 4 December
and credited in respect of Private
Placement Shares
Note: The above dates and times are subject to change and any
changes will be released on SENS and published in the press.
4. ABRIDGED PROSPECTUS
The Abridged Prospectus appearing below, is not an invitation to
the public to subscribe for STADIO Shares, but is issued in
compliance with the Companies Act for the purpose of providing
information to Invited Investors in respect of STADIO.
4.1. BUSINESS RATIONALE OF STADIO
4.1.1. The current unemployment rate in South Africa remains critically
high at 27.7%.
4.1.2. Education and training remains vitally important to reduce
unemployment and promote economic growth.
4.1.3. Research further indicates that in South Africa, the graduate
unemployment rate is at about 5%, implying that a degree or post
school qualification dramatically increases the probability of
securing a job and therefore economic security and stability.
4.1.4. As such, the board of directors of STADIO (“STADIO Board”)
believes that STADIO, through its subsidiaries, can play a
meaningful role by:
4.1.4.1. Widening access to higher education, by:
- investing capital to create capacity to accommodate the
increasing demand for higher education (i.e. with competing
socio-economic demands the government does not have the
financial and operational resources to address this
demand);
- providing seamless access and articulation pathways
through a compendium of qualifications that will allow for
progression from higher certificate to degree
qualifications;
- ensuring a sufficiently diverse programme and
qualification mix that caters to both school-leavers,
working adults and the post-graduate student, within the
framework of lifelong learning; and
- enhancing the use of distance learning which is both more
affordable and will increase the breadth of access;
4.1.4.2. Offering innovative curricula and programmes that are
relevant and relate to the world of work and the needs of
society i.e. programmes that will provide students with a
real chance of finding or creating employment post-
qualification, but which will equally ensure that STADIO
graduates have a fundamental understanding of responsible
citizenship and global awareness; and
4.1.4.3. Focussing on graduate success and throughput (i.e. access
with success), as follows:
- STADIO recognises that a number of higher education
students do not progress academically as a result of not
achieving examination admission. STADIO believes that,
having registered a student, the higher education
institution must take all reasonable and responsible steps
to facilitate the success of such student, including the
implementation of the ‘credit retry’ principle as an
integral element of its teaching and learning methodology.
The ‘credit retry’ principle focuses on identifying
students at risk of not achieving examination admission
and providing adaptive further academic support and/or
formative assessment opportunities that will improve their
chances to sit for the examination, pass the examination
and graduate successfully; and
- Private higher education institutions and STADIO
particularly, introduce an opportunity for students who
drop out and/or are academically cancelled, to ensure that
no learning is wasted. STADIO’s academic ethos promotes
articulation and mobility between and among its own
institutions as well as the public higher education sector
through the application of existing DHET policies of credit
accumulation and transfer, recognition of prior learning,
and recognition and equivalence of degrees.
4.1.5. The intention of the Unbundling and Listing was to create a
separate listed business, focussing on higher education, with a
strong management team and a dedicated anchor shareholder
(namely PSG Group Limited) in order to become a leader in the
higher education market in South Africa.
4.1.6. To achieve its goal, STADIO intends to create a “Multiversity”.
A Multiversity is defined as a large, diverse institution of
higher learning created to educate for life and for a
profession, and to grant degrees, (including higher certificates
and diplomas). Whereas a university implies “sameness” and the
integration of all knowledge, a Multiversity implies a DIVERSITY
of knowledge with diverse institutions catering for the diverse
and relevant needs of the South African market place. The
concept of a Multiversity further respects the uniqueness of
every student.
4.1.7. As a Multiversity, STADIO will own various registered higher
education institutions, which will retain their own brands,
campuses and management teams, but will share a common ethos
and benefit from the synergies, infrastructure and shared
services arising from the STADIO Group structure.
4.1.8. STADIO is an investment holding company that focusses on the
acquisition of, investment in, growth and development of higher
education institutions to assist in meeting the demand for
quality and relevant higher education programmes in Southern
Africa. It intends to acquire and grow existing registered
higher education brands, fund further expansions of existing
brands and oversee the greenfield development of new campuses.
4.1.9. STADIO, through its subsidiaries, will have diverse offerings
including undergraduate and post graduate programmes (higher
certificates, diplomas and degrees), geared to providing
students with a real chance of creating their own employment
opportunities (entrepreneurship) or finding employment post-
qualification. As the investment holding company of the various
education institutions, STADIO will monitor the business success
and drive efficiencies, innovations and best practices across
the STADIO Group.
4.1.10. At the Listing Date, the STADIO Group had:
- 3 registered higher education institutions, namely Embury,
AFDA and the Southern Business School (as more fully
described below) that have been operating for between 17 and
23 years;
- 5 faculties, namely (i) Education; (ii) Commerce and
Business; (iii) IT; (iv) Law and (v) Arts;
- 28 accredited programmes, ranging from higher certificates
and diplomas to post graduate degrees (including masters’
degrees);
- approximately 22 new courses/programmes in the process of
development and accreditation, which will be offered by the
STADIO Group from the commencement of the 2018, 2019 or 2020
academic years;
- 10 registered campuses/sites, including sites in Gauteng,
the Western Cape, Kwa-Zulu Natal, Eastern Cape, Botswana
(Gaborone) and Namibia (Windhoek); and
- approximately 12 979 registered students.
4.1.11. STADIO has subsequently increased its programme offerings
through the acquisition of Milpark as announced on SENS on
13 October 2017 and LISOF as announced on SENS on
26 October 2017.
4.1.12. STADIO will grow its business by focussing on:
4.1.12.1. the acquisition of reputable higher education institutions,
aligned with STADIO’s Multiversity strategy and ethos, with
the aim to accumulate a wide spread of programmes and
qualifications in various fields of higher education;
4.1.12.2. optimising the utilization of STADIO’s newly constructed
facilities;
4.1.12.3. promoting the growth of existing brands. This will include:
- geographic expansion through rolling out the brands to new
locations;
- accrediting further undergraduate and post-graduate
degrees, diplomas and higher certificate qualifications
across various brands;
- investing in focused marketing across the various brands
and products of the STADIO Group; and
- expanding distance learning offerings across the brands
(key qualifications to be accredited on both distance
learning and contact learning modes of delivery); and
4.1.12.4. expanding into greenfield opportunities by exploring its
offering into new faculties, such as Engineering as well as
Health and Sciences, in due course.
4.2. PROSPECTS
4.2.1. STADIO’s objective is to facilitate, through its subsidiaries,
access to quality higher education, giving its students
realistic opportunities of finding or creating future
employment.
4.2.2. Through implementing its growth strategy, the details of which
are set out in paragraph 4.1.12 above, the STADIO Group’s
objective is to increase its student enrolments (across both
the contact and distance learning modes of delivery) initially
to 35 000 students in the medium term and then to approximately
56 000 students by 2026, earning a profit after taxation of
approximately R500 million (also by 2026). STADIO believes that
the aforementioned target can be achieved through deploying:
(i) the capital of R840 million raised from the renounceable
rights offer that STADIO made to its shareholders following the
Listing and the Private Placement; (ii) internally generated
cash; and (iii) debt funding.
PLEASE NOTE THAT THE AFOREGOING STATEMENT OF STADIO’S OBJECTIVE
HAS NOT BEEN REVIEWED OR REPORTED ON BY STADIO’S AUDITORS OR BY
AN INDEPENDENT REPORTING ACCOUNTANT NOR IS SAME GUARANTEED. IT
IS HOWEVER AN OBJECTIVE THAT STADIO WISHES TO ACHIEVE BY 2026.
4.2.3. Over time however, STADIO’s vision is to increase its reach to
100 000 students.
4.2.4. Given the opportunities in the sector and the demand for quality
higher education, the STADIO Board is of the opinion that
STADIO’s prospects are very favourable.
4.3. BROAD-BASED BLACK ECONOMIC EMPOWERMENT STRATEGY AND PRIVATE
PLACEMENT
4.3.1. STADIO recognises the importance of social and economic
transformation in the South African environment and intends to
implement the Private Placement by way of offering the Private
Placement Shares to Black Persons and Brimstone as part of its
larger B-BBEE strategy.
4.3.2. In terms of the Private Placement, STADIO will raise
approximately R200 million by way of an offer for subscription
to Invited Investors for approximately 67 000 000 to 80 000 000
(but no more than 87 000 000) Private Placement Shares in STADIO
at the Private Placement Issue Price.
4.3.3. Subject to the discretion of the Board, only Brimstone and
Invited Investors who are Black Persons are entitled to
participate in the Private Placement.
4.3.4. Brimstone will subscribe for approximately 40 000 000 Private
Placement Shares in terms of the Private Placement on a
preferential basis.
4.3.5. The minimum subscription amount per Black Employee in terms of
the Private Placement shall be R20 000.
4.3.6. The minimum subscription amount per Black Person other than
Black Employees, in terms of the Private Placement is R50 000.
4.3.7. The Private Placement Shares will be issued at the Private
Placement Issue Price. The Private Placement Issue Price will
be the lower of R2.96 and the Discounted Trading Price (being
the VWAP of a Share for the 30 trading day period after the
Listing Date, less a 20% discount, subject to the condition
precedent as set out in paragraph 4.3.12 below). The intention
being for Invited Investors to enjoy the benefit should the
Discounted Trading Price be lower than R2.96. The final Private
Placement Issue Price shall be provided to Invited Investors by
PSG Capital on or about Tuesday, 14 November 2017, which is well
before the closing date of the Private Placement.
4.3.8. The Private Placement Shares will be allotted subject to the
provisions of the MOI and will rank pari passu in all respects
including distributions, with all existing issued STADIO Shares.
4.3.9. There are no convertibility or redemption provisions relating
to any Private Placement Shares.
4.3.10. The Private Placement Shares will only be issued in
Dematerialised form. No certificated Private Placement Shares
will be issued.
4.3.11. No fraction of Private Placement Shares will be offered in terms
of the Private Placement.
4.3.12. Condition Precedent
The Private Placement is subject to the condition precedent
that, if the Discounted Trading Price is lower than R2.50 per
STADIO Share, the Board resolves that it still wishes to proceed
with the Private Placement.
4.3.13. Underwriting
4.3.13.1. Brimstone has agreed to underwrite the balance of the Private
Placement Shares not taken up by Black Persons.
4.3.13.2. Brimstone will not be entitled to any underwriting or
placement fee in respect of the underwriting of the balance
of the Private Placement Shares or for subscribing for the
Brimstone Private Placement Shares.
4.3.14. Lock-In
4.3.14.1. All Private Placement Shares issued as part of the Private
Placement will be subject to a Lock-In period of 7 years,
during which period, the holders of Private Placement Shares
shall only be allowed to sell their Private Placement Shares
to other Black Persons, which have been verified and approved
by STADIO having considered, inter alia, the potential
shareholder base that the Board wishes to achieve, when
granting such approval. In addition, the purchaser will be
required to take the same steps and open the same accounts as
prescribed in paragraph 4.3.14.2 below before any Private
Placement Shares may be transferred to such purchaser.
4.3.14.2. In order to participate in the Private Placement and to
facilitate the Lock-In, applicants will be required to open
a brokerage account with PSG Wealth.
4.3.14.3. The brokerage account opened with PSG Wealth will be a
restricted account in terms of which the holders of Private
Placement Shares will not be able to sell their Private
Placement Shares unless the purchaser of the Private Placement
Shares is a Black Person, verified and approved by STADIO.
For the avoidance of doubt, there is no obligation on STADIO
to set up a trading platform to facilitate trade in the
Private Placement Shares and it is not STADIO’s intention to
do so at present.
4.3.14.4. Following the expiry of a 7-year Lock-In period from the
listing date of the Private Placement Shares, all restrictions
in relation to the trading of the Private Placement Shares
will fall away.
4.3.14.5. In order to open a brokerage account at PSG Wealth, Invited
Investors should contact Siphokazi Melamane at
wealth@psg.co.za or 0860 000 368.
4.3.14.6. PSG Wealth will not charge any monthly administration fees to
the holders of Private Placement Shares during the Lock-In
Period.
4.3.15. Use of proceeds from Private Placement
The capital raised in terms of the Private Placement will be
used to fund the acquisition of land and the development of
existing campuses to facilitate growth, for working capital
purposes and to build up the capital resources for future
opportunities.
5. COPIES OF THE PROSPECTUS
A copy of the Prospectus will be available on STADIO’s website
(www.stadio.co.za) from today, Monday, 30 October 2017. Copies of
the Prospectus may also be obtained between 8:00 and 17:00 on
Business Days from Monday, 30 October 2017 to Monday,
27 November 2017 at the following addresses:
STADIO Holdings Limited
Unit 13, San Domenico
10 Church Street
Durbanville, 7550
PSG Capital Proprietary Limited
1st Floor, Ou Kollege
35 Kerk Street
Stellenbosch, 7599
and at
Bowmans Building
2nd Floor
11 Alice Lane
Sandhurst
Sandton, 2196
6. ACTION REQUIRED BY INVITED INVESTORS
6.1. In order to participate in the Private Placement and to facilitate
the Lock-In, applicants will be required to open a brokerage
account with PSG Wealth.
6.2. In order to open a brokerage account at PSG Wealth, Invited
Investors should contact Siphokazi Melamane at wealth@psg.co.za
or 0860 000 368. For the purpose of opening such brokerage
accounts, Invited Investors will be required to submit the
following information and/or documents:
6.2.1. copy of South Africa identity document (for South African
citizens) or copy of passport (for foreign nationals);
6.2.2. proof of address which is less than three months old (for example
utility bill, store account statement, bank statement, DSTV
account statement, municipal letter) or, if not available, a
declaration by a third party confirming address together with
copy of third party's identity documents and proof of address
(less than three months old);
6.2.3. copy of SARS document confirming income tax number; and
6.2.4. copy of bank statement confirming banking details (less than
three months old).
6.3. PSG Wealth will not charge any monthly administration fees to the
holders of Private Placement Shares during the Lock-In Period.
6.4. Invited Investors are to provide PSG Capital with their completed
Application Form by 17:00 on Monday, 27 November 2017.
6.5. All Application Forms submitted must be accompanied by a certified
copy of the applicant’s identity document.
6.6. Application Forms must be completed in accordance with the
provisions of the Prospectus and the instructions contained in
the Application Form, which is attached to the Prospectus and
which will be made available to Invited Investors.
6.7. Other than as detailed in the Application Form, no documentary
evidence of capacity to apply need accompany the Application Form,
but STADIO reserves the right to call upon any applicant to submit
such evidence for noting and, which evidence will be held on file
with STADIO or the Transfer Secretaries or returned to the
applicant at the applicant’s risk.
6.8. No payment should be submitted with the Application Form delivered
to the Sole Bookrunner, PSG Capital. Applicants must make the
necessary arrangements to enable their CSDP or Broker to make
payment for the allocated Private Placement Shares on the
settlement date, which is expected to be Monday, 4 December 2017,
in accordance with each applicant’s agreement with their CSDP or
Broker.
6.9. Invited Investors must ensure that their accounts with their CSDP
or Broker is sufficiently funded for payment to be paid in respect
of the Private Placement Shares allocated to them in terms of the
Private Placement on the date that their Application Form is
submitted. Failure to do so may result in their application for
Private Placement Shares being rejected.
6.10. Queries in relation to Private Placement
Should you have any specific queries with regards to the Private
Placement, you are welcome to contact Willie Honeyball on
willieh@psgcapital.com or 021-887-9602 / 071-173-4729; or
Johannes Human on johannesh@psgcapital.com or 021-887-9602 / 074-
894-7189.
Durbanville
30 October 2017
Transaction Advisor, Sole Bookrunner and Sponsor: PSG Capital
Proprietary Limited
Legal Advisor: Cliffe Dekker Hofmeyr
Auditor: PricewaterhouseCoopers Incorporated
Date: 30/10/2017 09:00:00 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.
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