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Disposal of certain Nampak equipment
Nampak Limited
(Incorporated in the Republic of South Africa)
Registration Number: 1968/008070/06
Share Code: NPK ISIN: ZAE 000071676
Share Code: NPP1 ISIN: ZAE000004966
Share Code: NPKP ISIN: ZAE000004958
LEI: 3789003820EC27C76729
(“Nampak” or the “Company”)
DISPOSAL OF CERTAIN NAMPAK EQUIPMENT
1.Introduction
Shareholders are advised that Nampak, via its wholly-owned subsidiary,
Nampak Products Limited (“Nampak Products” or the “Seller”), has entered
into a sale of equipment agreement (“Sale Agreement”) with Mpact Plastic
Containers Castleview Proprietary Limited (“Mpact Plastic Containers”
or the “Purchaser”), to dispose of certain equipment relating to its
crates manufacturing business and ancillary plant and equipment
(“Equipment”) (the “Disposal”).
Mpact Plastic Containers is an indirect subsidiary of JSE-listed Mpact
Limited.
2.Rationale
Nampak has wound down and closed its crates manufacturing business and
the Disposal relates to the Equipment that is no longer used by Nampak.
The Disposal is in line with Nampak’s active portfolio optimisation
strategy and will assist Nampak in its focus on the balance of its
portfolio and to reduce its interest bearing debt.
3.Details of the Equipment
The Disposal relates to certain selected Equipment as expressly
described and specified in the Sale Agreement. The Equipment is located
at Nampak sites in Olifantsfontein, Gauteng, Pinetown, Kwazulu-Natal
and Epping, Western Cape. The Equipment mainly consists of injection
moulding and recycling equipment, ancillary equipment and spares.
Mpact Plastic Containers is not acquiring or otherwise taking over any
other aspect of relating to Nampak's crates business, including any of
Nampak’s contracts, supply agreements with its customers and/or
goodwill, all of which shall remain with Nampak Products. The Equipment
is being sold voetstoots.
4.Disposal consideration and application of proceeds
The consideration payable for the Disposal amounts to R40 000 000
(exclusive of VAT) (“Consideration”), which will be paid in cash by the
Purchaser in 3 (three) tranches as follows:
4.1 the first tranche, in an amount equal to 50% of the Consideration,
shall be paid on the date upon which the Purchaser takes delivery
of the Equipment in the manner contemplated in the Sale Agreement
(“Delivery Date”), which date shall occur within 3 business days
after the effective date of the Sale Agreement (“Effective Date”),
being the second business day after the date on which the last of
the conditions precedent is fulfilled or waived, as the case may
be);
4.2 the second tranche, in an amount equal to 25% of the Consideration
shall be paid no later than 15 (fifteen) business days after the
Delivery Date in respect of the equipment located at the Pinetown
and Epping sites; and
4.3 the third tranche, in an amount equal to 25% of the Consideration,
shall be paid on completion of decommissioning and removal of the
Equipment located at the Olifantsfontein site.
The Consideration shall be paid in full by no later than 3 (three)
months after the Delivery Date.
The proceeds from the Disposal shall be used primarily to reduce the
Company’s interest-bearing debt.
5.Conditions precedent to the Disposal
The Disposal is subject to the fulfilment, or where applicable, waiver
of the following conditions precedent:
5.1 Nampak having published (the notices required to be published in
relation to the proposed sale of the Equipment, in terms of section
34 of the Insolvency Act), and for a period of 30 (thirty) days
after such publication either: (i) no legal proceedings having
being instituted or claim having being made against the Seller in
connection with the Equipment (together, "Claims"); or (ii) if a
Claim is made, the Seller having either: (a) discharged any such
Claim made against it in full; or (b) secured the release of any
attached Equipment and the return of such Equipment to the relevant
site; and
5.2 on or before the date on which the condition precedent in paragraph
5.1 above has been fulfilled or waived (as applicable), Nampak
Products not having been placed in business rescue, liquidation
or judicial management or similar process, whether provisional or
final, and whether compulsory or voluntary.
The Disposal shall furthermore be subject to the resolutive condition
that between the Effective Date and the Delivery Date, Nampak has not
received or otherwise become aware of any Claims in respect of the
Equipment, as contemplated by section 34(3) of the Insolvency Act and
that if any Claims are made, Nampak having either: (i) discharged any
such Claims made against it in full; or (ii) secured the release of any
attached Equipment and the return of such Equipment to the relevant
site.
The Sale Agreement contains representations, indemnities and warranties
by Nampak Products which are standard for transactions of this nature.
6.Financial information
The book value of the Equipment is R4,5 million and the profit on the
Disposal of the Equiment amounts to R35,5 million. The financial
information has been extracted from Nampak’s unaudited management
accounts for the period ended 28 February 2023 which were prepared in
terms of International Financial Reporting Standards.
7.Categorisation
The Disposal is categorised as a Category 2 transaction in terms of the
JSE Listings Requirements and accordingly no shareholder approval is
required.
Bryanston
22 March 2023
Sponsor
Nedbank Corporate and Investment Banking, a division of Nedbank Limited
Date: 22-03-2023 11:01:00
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