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YRK - York - Pro forma financial effects and withdrawal of cautionary

Release Date: 11/05/2007 17:06
Code(s): YRK
Wrap Text

YRK - York - Pro forma financial effects and withdrawal of cautionary announcement The York Timber Organisation Limited (Registration number 1916/004890/06) Share code: YRK ISIN: ZAE000008108 ("York" or "the Company") PRO FORMA FINANCIAL EFFECTS AND WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT 1. INTRODUCTION Further to the terms announcement released on SENS on 2 April 2007 whereby York will acquire 100% of Global Forest Products (Proprietary) Limited ("GFP") and South African Plywood (Proprietary) Limited ("Plywood") with effect from 30 June 2007 in one indivisible transaction for R1,694,747,439 ("the purchase consideration"), subject to all the required approvals being obtained ("the Acquisition"), the directors advise of the pro forma financial effects of the Acquisition below. 2. CONDITIONS PRECEDENT The Acquisition remains subject to conditions precedent as detailed in the announcement dated 2 April 2007. 3. PRO FORMA FINANCIAL EFFECTS Set out in the table below are the pro forma financial effects of the Acquisition, which have been prepared for illustrative purposes only, to provide information about how the Acquisition might have affected the financial information of York as presented. The pro forma financial effects are the responsibility of the directors. Due to their nature, the pro forma financial effects may not give a fair reflection of the balance sheet and results of operations of York after the Acquisition. Before the After the Percentage
Acquisition Acquisition change (%) (cents per (cents per share) share)
Earnings 283.64(i) 296.13(ii) 4.40 Headline earnings 263.25(i) 440.10(ii) 67.18(v) Net asset value 941.14(iii) 1,403.85(iv) 49.17 Tangible net asset 941.14(iii) 373.21(iv) (60.34) value Notes: i) The earnings and headline earnings per ordinary share of York ("York share"), as set out in the "Before" column of the table, are based upon the audited financial results of York for the twelve months ended 31 December 2006 and 11,040,597 weighted average number of York shares in issue. ii) The earnings and headline earnings per York share, as set out in the "After" column of the table, are based upon the audited financial results of York for the twelve months ended 31 December 2006 including the adjusted annualised reviewed results of GFP and Plywood for the six months ended 31 December 2006, and 67,707,264 weighted average number of York shares in issue and the assumptions that: - the purchase consideration was settled on 1 January 2006 with R844,747,000 loan capital, R 350 million raised in terms of a rights offer, which is fully underwritten, at R15 per York share and the issue of 23,333,333 York shares to the IDC and 10,000,000 York shares to a BEE SPV to be funded by the IDC at an issue price of R15 per York share as consideration for the IDC`s 30% in GFP and Plywood;the purchase acquisition includes goodwill of R697,823; - the loan capital was borrowed at an interest rate of prime plus 1%; - the effective tax rate is 29%; and - there were no additional costs incurred relating to the acquisition. iii) The net asset value and tangible net asset value per York share, as set out in the "Before" column of the table, are based upon the audited balance sheet of York as at 31 December 2006 and 11,040,597 weighted average number of York shares in issue. iv) The net asset value and tangible net asset value per York share, as set out in the "After" column of the table, are based upon the audited balance sheet of York as at 31 December 2006 including the reviewed balance sheet of GFP and Plywood as at 31 December 2006, 67,707,264 weighted average number of York shares in issue and the assumptions that: - the Acquisition was effective 31 December 2006; - the purchase consideration was settled on 31 December 2006 with R844,747,000 loan capital, R 350 million raised in terms of a rights offer, which is fully underwritten, at R15 per York share and the issue of 23,333,333 York shares to the IDC and 10,000,000 York shares to a BEE SPV to be funded by the IDC at an issue price of R 15 per York share as consideration for the IDC`s 30% in GFP and Plywood; - the purchase acquisition includes goodwill of R697,823; and there were no additional costs incurred relating to the Acquisition. v) The difference between earnings and headline earnings is mostly attributable to the impairment of goodwill and property, plant and equipment in the reviewed interim results of Plywood for the six months ended 31 December 2006. A full reconciliation of the difference will be provided in the circular to shareholders (refer paragraph 4 below). 4. CIRCULAR TO SHAREHOLDERS A circular to shareholders of York ("York shareholders") will be issued and an announcement containing the salient dates and times pertaining to the Acquisition will be released in due course. Shareholders should note that, as the acquisition constitutes a revised listing in terms of the Listing Requirements of the JSE Limited ("JSE"), the continued listing of York is contingent upon the JSE`s assessment of the suitability of such continued listing subsequent to the implementation of the Acquisition. 5. WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT York shareholders are advised that caution is no longer required to be exercised by York shareholders when dealing in their securities. Pretoria 11 May 2007 Corporate Advisor and Sponsor Metier Transaction Arranger and Equity Underwriter Blackstar Equity Participant and BEE Funder Industrial Development Corporation of South Africa Limited Attorneys Edward Nathan Sonnenbergs Inc. Competition Law Advisors Webber Wentzel Bowens Debt Arrangers and Underwriters Rand Merchant Bank (a division of FirstRand Limited) Tax Advisors Deloitte & Touche Reporting accountants and auditors KPMG Date: 11/05/2007 17:06:01 Supplied by www.sharenet.co.za Produced by the JSE SENS Department.

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