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Disposal of Minority Interests in Octotel Pty Ltd (Octotel) & RSAWeb Pty Ltd (RSAWEB)( Collectively "the Disposal")
Caxton and CTP Publishers and Printers Limited
(Incorporated in the Republic of South Africa)
(Registration number 1947/026616/06)
Share code: CAT ISIN: ZAE 000043345
(“Caxton” or “the company”)
DISPOSAL OF MINORITY INTERESTS IN OCTOTEL PROPRIETARY
LIMITED (“OCTOTEL”) AND RSAWEB PROPRIETARY LIMITED
(“RSAWEB”) (COLLECTIVELY “THE DISPOSAL”)
1. INTRODUCTION
Shareholders are advised that Caxton has entered into agreements dated 9 October 2020 in terms of which it will,
subject to the conditions precedent referred to in paragraph 4 below, implement the Disposal. Full details of the
Disposal are set out in this announcement.
2. RATIONALE FOR THE DISPOSAL
Caxton’s initial investment in RSAWeb in 2013 was primarily intended to strengthen Caxton’s relationship with its
network provider, and to provide RSAWeb with access to capital for expansion. In 2016, Caxton further invested in
Octotel and provided that business with capital to enable it to become one of the largest fibre-to-the-home operators
in the Western Cape. Both businesses have grown beyond expectations and, on receiving an offer from Neoma
Africa Fund, a fund managed by the Actis Group (a leading growth and emerging market investor) (“the Purchaser”),
the company agreed to support the sale of these businesses. They represent non-core investments for the company
and need focused shareholder investors to take them to the next level.
3. DETAILS OF THE DISPOSAL
3.1 Caxton will dispose of its shares and claims on loan account in Octotel and RSAWeb (“the Disposal Assets”)
to the Purchaser for an estimated aggregate consideration of R493 million (R433 million in respect of the
shares and R60 million in respect of the repayment of the claims on loan account). The consideration will be
payable in cash on delivery of the share certificates and other relevant documentation relating to the Disposal
Assets to the Purchaser. The fair value of the Disposal Assets is R493 million.
3.2 The effective date of the Disposal is expected to be 15 December 2020.
3.3 The agreements governing the Disposal contain limited warranties that are usually found in agreements
regarding transactions of this nature.
3.4 The proceeds of the Disposal will be added to the existing cash reserves of the company, pending decisions
as to effective utilisation of such funds.
4. CONDITIONS PRECEDENT
The Disposal is, inter alia, subject to:
4.1 the approval by the Johannesburg Stock Exchange (“the JSE”) of the circular to shareholders referred to in
paragraph 7 below;
4.2 the approval by any additional regulatory authorities which may be required; and
4.3 the approval of the Disposal by the shareholders of the company in general meeting as indicated in
paragraph 6 below.
5. PRO FORMA FINANCIAL EFFECTS OF THE DISPOSAL
The table below sets out the pro forma financial effects of the Disposal on the headline earnings per share,
earnings per share, net asset value per share and net tangible asset value per share in Caxton, based on the
published reviewed provisional results of the company for the financial year ended on 30 June 2020. The financial
effects are the responsibility of the directors of the company, are prepared for illustrative purposes only and,
because of their nature, may not fairly present the financial position of the company, changes in its equity or the
results of its operations or cash flows after the Disposal.
Before the
Disposal After the Disposal Percentage
(reviewed (pro forma increase/
Notes 30 June 2020) 30 June 2020) (decrease)
Headline earnings per share (cents) 1 21,2 22,9 7,6%
Earnings per share (cents) 1 -14,8 68,8 565,0%
Net asset value per share (cents) 2 1 384 1 466 6,0%
Net tangible asset value per share (cents) 2 1 351 1 434 6,1%
Number of shares in issue 377 861 111 377 861 111 –
Notes:
1. The headline earnings and earnings per share in the “After the Disposal” column have been based on the assumption
that the Disposal had been effective for the year ended on 30 June 2020.
2. The net asset value and net tangible asset value per share in the “After the Disposal” column has been based on the
assumption that the Disposal was effective on 30 June 2020 and that all transaction costs were paid and required
write-downs and provisions were made on the effective date.
6. CATEGORISATION OF THE DISPOSAL
The Disposal is categorised as a Category 1 transaction in terms of the Listings Requirements of the JSE and
therefore requires approval by the shareholders of Caxton in general meeting.
7. CIRCULAR TO SHAREHOLDERS
A circular to shareholders convening the general meeting of shareholders of the company required to implement the
Disposal is in the course of preparation and will be despatched to shareholders within 60 days of this announcement.
By order of the board.
Johannesburg
12 October 2020
Sponsor Auditors and reporting accountants Attorneys Financial Advisor
AcaciaCap Advisors BDO Fluxmans Attorneys RMB Holdings
Date: 12-10-2020 12:30:00
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