RAND MERCHANT INVESTMENT HOLDINGS LIMITED - Cash payment in respect of fractional entitlements

Release Date: 05/04/2018 09:42
Code(s): RMI
 
Wrap Text
Cash payment in respect of fractional entitlements

RAND MERCHANT INVESTMENT HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
Registration number: 2010/005770/06
ISIN: ZAE000210688
Share code: RMI
("RMI" or "the Company")

CASH PAYMENT IN RESPECT OF FRACTIONAL ENTITLEMENTS

The ordinary shareholders of the Company ("RMI Shareholders") are
referred   to   the   Company’s    summarised   unaudited   results
announcement including the dividend declaration for the six months
ended 31 December 2017 published on the Stock Exchange News
Service (“SENS”) of the JSE Limited (“JSE”) on 12 March 2018.

The Company declared an interim gross cash dividend of 39 cents
per ordinary share for the six months ended 31 December 2017
("Cash Dividend") and provided RMI Shareholders an alternative to
elect to (i) receive fully paid up RMI ordinary shares with a par
value of R0.0001 (“RMI Shares”) in the Company in lieu of the Cash
Dividend (“Scrip Distribution Alternative”); or (ii) reinvest all
or part of the Cash Dividend (net of any applicable taxes)
(subscription value) in RMI Shares by RMI (a) crediting such
subscription value to RMI Shareholders; and (b) applying such
credit on behalf of RMI Shareholders to subscribe for reinvestment
shares (“Reinvestment Option”), in respect of all or a part of
their shareholding recorded in RMI’s securities register at 12:00
on the record date, being Friday, 6 April 2018 (“Record Date”).

The ratio of the Scrip Distribution Alternative and the
Reinvestment Option has been determined with reference to such RMI
Shareholder’s ordinary shareholding in RMI (at 12:00 on the Record
Date) in relation to the ratio that 39 cents or the Cash Dividend
(net of any applicable taxes), in the Scrip Distribution
Alternative or Reinvestment Option, respectively, bears to the
issue price being R42.50 per share, which is a 4.5% discount to
the closing price on Thursday, 8 March 2018 for RMI Shareholders
electing such option.

The number of capitalisation shares which RMI Shareholders may
elect to receive under the Scrip Distribution Alternative has been
determined in the ratio of 0.91765 fully paid RMI Shares for every
100 RMI Shares held on the Record Date.

The reinvestment shares will be issued in consideration for the
amount of the Cash Dividend (net of any applicable taxes) as
elected to be reinvested by RMI Shareholders. The number of
reinvestment shares which RMI Shareholders may elect to receive
under the Reinvestment Option, assuming RMI Shareholders are
liable for the full local 20% dividends tax, has been determined
in the ratio of 0.73412 reinvestment shares for every 100 RMI
Shares held on the Record Date. If no dividends tax is payable,
the number of reinvestment shares which RMI Shareholders may elect
to receive under the Reinvestment Option has been determined in
the ratio of 0.91765 reinvestment shares for every 100 RMI Shares
held on the Record Date.

Trading in the electronic settlement environment operated by
Strate   Proprietary  Limited   does   not permit  fractions  and
fractional entitlements. The JSE Listings Requirements contains a
fractional entitlement principle which provides that fractional
entitlements of shares will be rounded down to the nearest whole
number and a cash payment will be paid for the fractional
entitlement at beneficial owner level.

Accordingly, where an RMI Shareholder’s entitlement to new RMI
Shares in respect of the Scrip Distribution Alternative or the
Reinvestment Option results in a fraction of a new RMI Share, such
fraction will be rounded down to the nearest whole number
resulting in allocations of whole RMI Shares to RMI Shareholders
and a cash payment for the fraction will be made to such RMI
Shareholders (“Rounding Provision”).

The weighted average traded price for RMI Shares on Wednesday, 4
April 2018 (the “VWAP”) less 10% of such weighted average traded
price has been used as the cash value for fractional entitlements
to be paid to RMI Shareholders in accordance with the JSE Listings
Requirements.

RMI Shareholders are accordingly advised that the basis applicable
in determining the cash payment of the fractional entitlement is
3 478 cents (i.e. 3 864 cents, being the VWAP, discounted by 10%)
and 2 782 cents, net of applicable 20% dividend withholding tax.

Examples of the fractional entitlement cash payments are set out
below:
Example 1 - assumes that an RMI Shareholder holds 1 000 RMI Shares
on the Record Date and elects the Scrip Distribution Alternative:
New RMI Share entitlement = 9.1765 new RMI Shares. The Rounding
Provision described above is then applied and the RMI Shareholder
will receive 9 new RMI Shares in respect of the 1 000 RMI Shares
held and a cash payment for the fractional entitlement of 0.1765 x
3 478 cents = 613.867 cents. Assuming the fractional entitlement
payment in respect of this example is subject to 20% dividend
withholding tax, the net cash payment will be 491.0936 cents.

Example 2 - assumes that an RMI Shareholder holds 1 000 RMI Shares
on the Record Date and elects the Reinvestment Option and assuming
the fractional entitlement payment is subject to 20% dividend
withholding tax:
New RMI Share entitlement = 7.3412 new RMI Shares. The Rounding
Provision described above is then applied and the RMI Shareholder
will receive 7 new RMI Shares in respect of the 1 000 RMI Shares
held and a cash payment for the (post tax) fractional entitlement
of 0.3412 x 3 478 cents = 1 186.6936 cents.

Example 3 - assumes that an RMI Shareholder in respect of whom no
dividend tax is payable holds 1 000 RMI Shares on the Record Date
and elects the Reinvestment Option and the fractional entitlement
payment is not subject to dividend withholding tax:
New RMI Share entitlement = 9.1765 new RMI Shares. The Rounding
Provision described above is then applied and the RMI Shareholder
will receive 9 new RMI Shares in respect of the 1 000 RMI Shares
held and a cash payment for the fractional entitlement of 0.1765 x
3 478 cents = 613.867 cents.

Sandton
5 April 2018

Sponsor
RAND MERCHANT BANK (A division of FirstRand Bank Limited)

Date: 05/04/2018 09:42:00 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.

Email this JSE Sens Item to a Friend.

Share This Story