ITALTILE LIMITED - Specific Share Repurchase from Four Arrows Investments 256 Proprietary Limited

Release Date: 08/03/2018 16:30
Code(s): ITE
 
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Specific Share Repurchase from Four Arrows Investments 256 Proprietary Limited

ITALTILE LIMITED
Incorporated in the Republic of South Africa
(Registration number: 1955/000558/06)
Share code: ITE ISIN: ZAE000099123
(“Italtile” or “the Company”)


SPECIFIC SHARE REPURCHASE FROM FOUR ARROWS INVESTMENTS 256 PROPRIETARY LIMITED


As part of a black economic empowerment transaction concluded by Italtile in 2007, a Preference Share
Subscription Agreement (the “Agreement”) was entered into between Four Arrows Investments 256
Proprietary Limited (“Four Arrows”) and Italtile on 7 June 2007, as amended by the first and second
addenda thereto entered into between Italtile and Four Arrows on 7 June 2007 and 22 June 2012,
respectively. The proceeds of the preference share subscription were used to settle the debt incurred by
Four Arrows in funding its subscription for ordinary shares in Italtile. The terms of the Agreement were
disclosed in a circular sent to shareholders on 20 June 2007 (the “Circular”).

In accordance with the terms of the Agreement, Four Arrows submitted a share repurchase offer to Italtile
on 20 February 2018 (the "Share Repurchase Offer"), pursuant to which 25 000 000 ordinary shares in
Italtile held by Four Arrows (the "Repurchase Shares") were offered to Italtile for repurchase (the "Specific
Repurchase"), at a price based on 83% of the weighted average price at which Italtile shares traded on
the JSE Limited ("JSE") for the 10 trading days immediately preceding the date of receipt of the Share
Repurchase Offer being R11.82 per Repurchase Share, which equates to a total consideration of
R295 500 000 being payable for the Repurchase Shares (the "Repurchase Consideration"). Payment of
the Repurchase Consideration shall be settled in cash.

The Specific Repurchase was approved by Italtile shareholders by a separate special resolution passed
at the general meeting of Italtile shareholders held on 12 July 2007. In terms of such shareholder
approval, the Specific Repurchase is conditional upon the board of directors of Italtile (the "Board")
appointing an independent professional expert acceptable to the JSE to prepare an opinion, in
accordance with Schedule 5 of the JSE Listings Requirements, as to whether the Repurchase
Consideration is fair to the shareholders of Italtile and such independent expert determining that the
Repurchase Consideration is fair to the shareholders of Italtile.

In addition, the acceptance of the Share Repurchase Offer is conditional upon the following:

-   the Board providing the requisite consents and waivers in terms of or in connection with the
    Agreement; and
-   the application by the Board of the solvency and liquidity test as set out in section 4 of the
    Companies Act, 71 of 2008, as amended, (the "Solvency and Liquidity Test") and the Board
    reasonably concluding that the Company will, immediately after making payment of the
    Repurchase Consideration to Four Arrows, satisfy the Solvency and Liquidity Test.

All the aforementioned conditions have been fulfilled and the Board has unconditionally accepted the
Share Repurchase Offer on 7 March 2018. Accordingly, the Repurchase Consideration of R295 500 000
will be paid to Four Arrows on 13 March 2018.

Together with the acceptance of the Share Repurchase Offer, the Board has issued a notice to Four
Arrows calling for the redemption of all of the preference shares held by Italtile in Four Arrows. Four
Arrows has acknowledged receipt of such notice and accordingly, subject to Four Arrows satisfying the
Solvency and Liquidity Test, Four Arrows will be obliged, in accordance with the terms of the Agreement,
to redeem all such preference shares for an amount of approximately R165 700 000, which amount shall
be payable to Italtile on 20 March 2018.

Shareholders are referred to a copy of the Circular which is available on the corporate website
(www.italtile.com).

Johannesburg
8 March 2018

Sponsor
Merchantec Capital

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