LABAT AFRICA LIMITED - Intended Rights Offer - Initial Announcement

Intended Rights Offer - Initial Announcement

LABAT AFRICA LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1986/001616/06)
(“Labat” or “the Company”)
ISIN Code: ZAE 000018354 Share code: LAB


INTENDED RIGHTS OFFER – INITIAL ANNOUNCEMENT


1.   INTRODUCTION
     Shareholders are hereby advised that the Board has approved a partially underwritten,
     renounceable rights offer (“Rights Offer”) of ordinary no par value shares in Labat
     ("Ordinary Shares").

2.   RATIONALE FOR THE RIGHTS OFFER AND UTILISATION OF FUNDS
     In terms of the Rights Offer, the Company will raise a maximum of R74 677 505 from
     shareholders (assuming that the Rights Offer is fully subscribed), at a Rights Offer issue
     price of 12 cents per Rights Offer share. The Rights Offer will strengthen the Company’s
     capital structure and will improve Labat’s liquidity which will set the Company on a path
     to pursue its strategy to significantly accelerate the expansion of its vertically integrated
     Healthcare business.

     The Board will consider the best allocation of capital to achieve the prospects in relation
     to the organic expansion of Labat’s Healthcare business, particularly around the
     infrastructure, plant and machinery relating to the SAPHRA extraction licence. The
     balance of the proceeds from the Rights Offer will be used by Labat to settle expenses
     related to the Rights Offer and for working capital purposes, with the balance retained
     by the Company in an interest-bearing cash reserve account for further opportunities
     related to the Healthcare and hemp business.

3. SALIENT TERMS OF THE RIGHTS OFFER
3.1 Labat intends to offer a total of up to 622 312 545 Ordinary Shares for subscription by way
    of renounceable rights, at the Rights Offer issue price of 12 cents per Ordinary Share on
    the basis of 1 (one) Rights Offer Share for every 1 (one) Ordinary Share held by Labat
    shareholders who are permitted to participate in the Rights Offer and are reflected in the
    share register of Labat at the close of trade on the record date for the Rights Offer. If
    fully subscribed, Labat will raise a maximum of R74 677 505 in terms of the Rights Offer.

3.2 The Rights Offer Shares will, upon allotment and issue, rank pari passu with all other existing
    Ordinary Shares in terms of both voting rights and dividends.

3.3 The rights offer will be partially underwritten by directors and their associates, through the
    capitalisation of existing amounts owed to the related parties. There will be no
    underwriting commission.

4.   EXCESS APPLICATIONS
     There will be no provision for excess applications.

5.   CIRCULAR
     Further details of the Rights Offer will be disclosed in a circular, which will include a form
     of instruction in respect of the letters of allocation, to be issued to shareholders in due
     course.
A further declaration announcement which will include, inter alia, details of the underwriters
and the salient dates and times in respect of the Rights Offer, will be released in due course.

Johannesburg
14 June 2023

Sponsor
Acaciacap Advisors Proprietary Limited

Date: 14-06-2023 02:30:00
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