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Specific Repurchase Of Treasury Shares, Referred To As Tranche 2 Shares, By Alviva From Alviva Treasury Services
Alviva Holdings Limited
(Incorporated in the Republic of South Africa)
Registration number 1986/000334/06
Share Code: AVV
ISIN: ZAE000227484
(“Alviva” or “the Company”)
- Specific repurchase of treasury shares, referred to as Tranche
2 Shares, by Alviva from Alviva Treasury Services Proprietary
Limited (“Alviva Treasury Services”), to be implemented in
terms of the JSE Listings Requirements and sections 48(8)(b),
114 and 115 of the Companies Act, 2008 Act No. 71 of 2008), as
amended (“the Companies Act”); and
- subsequent delisting of the Tranche 2 Shares from the JSE
Limited (“JSE”) and cancellation thereof.
1. INTRODUCTION
Alviva shareholders, (“Shareholders”), are referred to the
SENS announcement dated 30 September 2016 where they were
advised that the Board of Directors of the Company resolved,
subject to Shareholder approval being obtained, to repurchase
ordinary shares held by Alviva Treasury Services as treasury
shares (“the Specific Repurchase Shares”) in two separate
divisible tranches, with:
- the Specific Repurchase Tranche 1, which was implemented
pursuant to the 2016 Annual General Meeting; and
- the balance of the Specific Repurchase Shares, being the
Tranche 2 Shares, being implemented pursuant to the 2018
Annual General Meeting.
Shareholders are hereby advised that Alviva concluded a share
repurchase agreement on 28 August 2018 (“Tranche 2 Agreement”)
with Alviva Treasury Services, a subsidiary of Alviva, for the
repurchase of Tranche 2 Shares. The Board of Directors of the
Company resolved, subject to Shareholder approval being
obtained at the 2018 Annual General Meeting, to repurchase the
balance of the Specific Repurchase Shares.
As at Tuesday, 28 August 2018, Alviva Treasury Services held a
total of 6 500 000 Alviva ordinary shares as treasury shares,
constituting 4,13% of the Company’s issued share capital,
being the Tranche 2 Shares. The number of treasury shares
repurchased in 2016 in terms of Specific Repurchase Tranche 1
was 5 569 974 shares, (“Tranche 1 Shares”). The Tranche 1
Shares and Tranche 2 Shares, collectively, amount to
12 069 974 Alviva ordinary shares held as treasury shares,
constituting 6,58% of the Company’s issued share capital,
being the Specific Repurchase Shares.
As this is more than 5% of the Company’s issued share capital,
the Specific Repurchase Tranche 2 is subject to the
requirements of sections 48(8)(b), 114 and 115 of the Companies
Act and paragraph 5.69 of the JSE Listings Requirements. In
accordance with sections 114(e), the Specific Repurchase
Tranche 2 will be implemented by way of a scheme of
arrangement. In terms of section 115(2)(a) of the Companies
Act, Specific Repurchase Tranche 2 requires the prior approval
of Shareholders in general meeting by means of a special
resolution.
The notice of Annual General Meeting, to form part of the 2018
Integrated Annual Report, will include a special resolution
relating to the Specific Repurchase Tranche 2 and will be
posted to shareholders as per paragraph 8 below.
2. SALIENT DETAILS OF THE SPECIFIC REPURCHASE TRANCHE 2
The Specific Repurchase Tranche 2 will be implemented at a
VWAP of Alviva ordinary shares traded on the JSE over the 30
(thirty) trading days immediately prior to the date of
conclusion of the Tranche 2 Agreement, being the Specific
Repurchase Tranche 2 Repurchase Price. As at 28 August 2018,
being the date on which the Tranche 2 Agreement was signed by
Alviva and Alviva Treasury Services, the Specific Repurchase
Tranche 2 Repurchase Price is R18,36 per ordinary share.
Accordingly, the total consideration payable by Alviva to
Alviva Treasury Services in respect of the Specific Repurchase
Tranche 2 amounts to R119 340 000.
As the Specific Repurchase Tranche 2 is intra-Group, no change
in the Group’s financial cash resources will transpire as a
result of the implementation of same and the financial effects
of the Specific Repurchase Tranche 2 are minimal.
Distributable reserves will be used to settle the Specific
Repurchase Tranche 2 Consideration.
Following the Specific Repurchase Tranche 2 being implemented,
the Tranche 2 Shares so repurchased will be delisted from the
JSE by the Company and then cancelled.
3. FINANCIAL IMPACT OF THE SPECIFIC REPURCHASE TRANCHE 2
- The impact of the Specific Repurchase Tranche 2 on the
Issued Share Capital of the Company is that the ordinary
shares in issue will be reduced by 6 500 000 to
150 717 917.
- The Company’s Share capital account will be reduced by
R65 000,00 (being the 6 500 000 Ordinary Shares with a par
value of 1 (one) cent per ordinary share).
- The Company’s reserves will be reduced by the difference
between the purchase price and the par value of the
Ordinary Shares, being 1 (one) cent per Ordinary Share as
the Company will elect to make payment of the Specific
Repurchase Tranche 2 Consideration out of distributable
reserves 1 which will constitute a “dividend” as per the
Income Tax Act No. 58 of 1962.
The Specific Repurchase Tranche 2 Consideration will be paid,
in full, in accordance with the terms of the Specific
Repurchase Tranche 2 without regard to any lien, right of set-
off, counterclaim or other analogous right to which Alviva may
otherwise be, or claim to be, entitled against any Alviva
Treasury Services.
4. RATIONALE FOR THE SPECIFIC REPURCHASE
The Board resolved to repurchase, delist and cancel the
Specific Repurchase Shares in order to:
- simplify the Group structure;
- eliminate accounting and regulatory complexities arising
from treasury shares in general; and
- save additional costs of administration.
5. CONDITIONS PRECEDENT
Implementation of the Specific Repurchase Tranche 2 is subject
to the fulfilment of the following conditions precedent:
- the approval by Shareholders at the Annual General Meeting
by way of the special resolution, as required by paragraph
5.69(b) of the JSE Listings Requirements and section
48(8)(b) of the Companies Act, adopted in accordance with
the requirements of sections 114 and 115 of the Companies
Act.
- to the extent and if required, the approval of the
implementation of the special resolution by the Court in
terms of section 115 of the Companies Act;
- if applicable, Alviva not treating the special resolution
as a nullity, as contemplated in terms of section 115(5)(b)
of the Companies Act; and
- the receipt of unconditional approvals, consents or waivers
from all regulatory bodies, including the JSE.
Should all of the conditions precedent referred to above not
have been fulfilled or waived (if possible), as the case may
be, following the conclusion of the Annual General Meeting to
be held on or about 21 November 2018, or any adjournment
thereof, or by such other later date as may be determined by
Alviva and subject to the approval of the Takeover Regulation
Panel (“TRP”) and JSE (if necessary), the Specific Repurchase
Tranche 2 will not become operative and shall be of no force
or effect. An announcement will be published on SENS and in
the South African press as soon as practicably possible
advising on the fulfilment or otherwise of the above
conditions precedent and the ramifications and effects
thereof.
6. THE COMPANY’S AUTHORISED AND ISSUED SHARE CAPITAL
Set out in the table below is the authorised and issued share
capital of the Company before and after the implementation of
the Specific Repurchase Tranche 2:
Before the Specific Repurchase Tranche 2:
R
Authorised share capital
300 000 000 ordinary shares of 1 cent each 3 000 000
Issued share capital
157 217 917 ordinary Shares of 1 cent each 1 572 179
Prior to the implementation of the Specific Repurchase Tranche
2, the Company holds 6 500 000 Alviva Ordinary Shares as
treasury shares, being the Tranche 2 Shares. Alviva Shared
Management Services Proprietary Limited holds 4 785 000 as
treasury shares, constituting 3,04% of the issued share
capital.
After the Specific Repurchase Tranche 2:
R
Authorised share capital
300 000 000 ordinary shares of 1 cent each 3 000 000
Issued share capital
150 717 917 ordinary shares of 1 cent each 1 507 179
Following the implementation of Specific Repurchase Tranche 2,
no treasury shares will be held by Alviva Treasury Services.
Alviva Shared Management Services Proprietary Limited will
continue to hold 4 785 000 as treasury shares, constituting
3,17% of the issued share capital.
7. OPINIONS AND RECOMMENDATIONS
The Board has appointed St John Capital Proprietary Limited,
the Independent Expert, to provide a report to Shareholders in
terms of section 114(3) of the Company’s Act. The Independent
Expert is of the opinion that the terms and conditions of the
Specific Repurchase Tranche 2 are fair and reasonable to
Shareholders.
The Directors have carefully considered the terms and
conditions of the Specific Repurchase Tranche 2 and, after
taking into account the opinion of the Independent Expert,
have concluded that such terms are fair and reasonable, and
accordingly recommend that Shareholders vote in favour of the
resolutions to be proposed at the Annual General Meeting. All
of the Directors having material direct or indirect beneficial
holdings in shares, intend to vote in favour of the
resolutions to be considered at the 2018 Annual General
Meeting to implement the Specific Repurchase Tranche 2.
8. THE SALIENT DATES AND TIMES FOR THE PROPOSED SPECIFIC
REPURCHASE TRANCHE 2
The circular, containing full details of the Specific
Repurchase Tranche 2, as well as the salient dates and times
for the Annual General Meeting, will be incorporated in the
2018 Integrated Annual Report. The salient dates and times
will also be published at time of posting of the circular and
2018 Integrated Annual Report to Shareholders. The 2018
Integrated Annual Report is expected to be posted on or about
Friday, 28 September 2018.
9. TRP EXEMPTION
In terms of section 119(6)(c) of the Companies Act, the TRP
has unconditionally exempted all parties from compliance with
the provisions of Part B and C of the Companies Act, and the
Takeover Regulations in respect of the Specific Repurchase
Tranche 2. A copy of the letter from the TRP granting the
exemption is made available for inspection at the Company’s
registered office.
Midrand
29 August 2018
Sponsor: Deloitte & Touche Sponsor Services Proprietary Limited
Legal Advisors: Tugendhaft Wapnick Banchetti and Partners
Independent Expert: St John Capital Proprietary Limited
Date: 29/08/2018 04:53:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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