GLOBAL ASSET MANAGEMENT LIMITED - Acq by an unlisted subsid of Global of an additional 45% int in Plastics Green Energy (Pty) Ltd from OM Assurance &

Acq by an unlisted subsid of Global of an additional 45% int in Plastics Green Energy (Pty) Ltd from OM Assurance &

GLOBAL ASSET MANAGEMENT LIMITED
(Incorporated in the Republic of South Africa)
(Registration number: 2002/003192/06)
Share Code: GAM ISIN: ZAE000173498
("Global" or “the Company”)


ACQUISITION BY AN UNLISTED SUBSIDIARY OF GLOBAL OF AN ADDITIONAL 45% INTEREST
IN PLASTICS GREEN ENERGY PROPRIETARY LIMITED (“PGE”) FROM OLD MUTUAL LIFE
ASSURANCE COMPANY (SOUTH AFRICA) LIMITED (“OMLACSA”) AND NOTICE IN TERMS OF
SECTION 45(5)(a) OF THE COMPANIES ACT


1.    Introduction
1.1   Shareholders are advised that Earthwize Energy Holdings Proprietary Limited
      ("EWEH"), an unlisted wholly-owned subsidiary of Global, has entered into a Sale
      and Purchase of Shares and Claims Agreement with OMLACSA (“Sale and
      Purchase of Shares and Claims Agreement”), as represented by Futuregrowth Asset
      Management Proprietary Limited (“Futuregrowth”) in terms of which OMLACSA has
      agreed to sell its entire 45% shareholding in Plastics Green Energy Proprietary
      Limited (“PGE”) to EWEH (the “Transaction”). OMLACSA and Futuregrowth are not
      related parties to Global.

1.2   The effective date of the Transaction is 27 March 2019.

1.3   Following the conclusion of the Transaction, EWEH’s shareholding in PGE will
      increase from 28% to 73%.

2.    Rationale
      PGE houses the Company's first commercial plastic-to-fuel conversion plant.
      Following substantial development work and detailed engineering, Global will
      utilise this proprietary technology within PGE to convert waste plastic into liquid fuel
      aimed at the industrial fuel oil market. The rationale for the Transaction is for Global
      to increase its current controlling shareholding of PGE and thereby also regain
      control of the aforementioned intellectual property.

3.    Consideration
3.1   The consideration payable in respect of the Transaction is R20.5 million (“Purchase
      Consideration”), to be settled in cash.

3.2   OMLACSA has agreed to make available a loan facility in the amount of the
      Purchase Consideration (“Loan Amount”) to PGE for PGE to apply towards
      completing the project currently undertaken by PGE, which loan will be repayable
      within five years after the date of payment thereof. Global has agreed to bind
      itself as surety for the obligations of EWEH in terms of the Sale and Purchase of
      Shares and Claims Agreement.

4.    Conditions precedent and warranties
4.1   All conditions precedent to the Transaction have been fulfilled and the Transaction
      is therefore unconditional.

4.2   Shareholder and regulatory approval is not required for the Transaction, as stated
      in paragraph 6 below.
4.3   The Sale and Purchase of Shares and Claims Agreement includes representations
      and warranties normal for a transaction of this nature.

5.    Financial Information
      The Transaction is not expected to have a material impact on the Statement of
      Comprehensive Income and the net asset value after non-controlling interest of
      Global.

      The value of the net assets that are the subject of the Transaction as at
      30 November 2018, being the last financial year end of Global, approximates
      R19.2 million. The loss after tax attributable to such net assets for the 12 months
      ended 30 November 2018 approximates R1.3 million.

      The above numbers were extracted from the audited annual financial statements
      of the Global group for the year ended 30 November 2018, which were reported
      on in accordance with full IFRS.

6.    Categorisation
      The Transaction is classified as a category 2 transaction in terms of the JSE Listings
      Requirements. Accordingly, shareholder approval of the Transaction is not
      required.

7.    Notice in terms of section 45(5)(a) of the Companies Act, No. 71 of 2008
      (“Companies Act”)
7.1   In terms of the provisions of section 45(5)(a) of the Companies Act and pursuant to
      the special resolution passed at the annual general meeting of the Company held
      on 11 July 2018 authorising the board of directors (“Board”) to provide direct or
      indirect financial assistance to related and inter-related parties, notification is
      hereby given by the Company that the Board has adopted a resolution in terms of
      section 45(3)(b) of the Companies Act authorising the Company to provide
      financial assistance to EWEH by virtue of agreeing to bind itself as surety for the
      obligations of EWEH in terms of the Sale and Purchase of Shares and Claims
      Agreement, as referred to in paragraph 3.3 above (“Financial Assistance”), which
      Financial Assistance amounts to R20.5 million.

7.2   In accordance with section 45 of the Companies Act, the Board is satisfied and
      acknowledges that:

      7.2.1   immediately after providing the Financial Assistance, Global would have
              satisfied the solvency and liquidity test as provided for in section 4 of the
              Companies Act, and
      7.2.2   the terms under which the Financial Assistance has been given are fair
              and reasonable to Global.

By order of the Board

Johannesburg
5 April 2019

Designated Advisor
Arbor Capital Sponsors Proprietary Limited

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