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CND - Acquisition by Conduit of 20.5% of the ordinary share capital of

Release Date: 11/11/2010 15:05
Code(s): CND
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CND - Acquisition by Conduit of 20.5% of the ordinary share capital of Amalgamated Electronic Corporation Limited Conduit Capital Limited Incorporated in the Republic of South Africa (Registration number 1998/017351/06) Share code: CND ISIN: ZAE000073128 ("Conduit" or "the group") ACQUISITION BY CONDUIT OF 20.5% OF THE ORDINARY SHARE CAPITAL OF AMALGAMATED ELECTRONIC CORPORATION LIMITED 1. INTRODUCTION Shareholders are advised that Conduit has acquired 15 987 449 ordinary shares in Amalgamated Electronic Corporation Limited ("Amecor") (representing 21.2% of Amecors`s ordinary shares in issue, net of treasury shares) on the open market for a total purchase consideration of R21.294 million (``the acquisition``). Conduit is an investment holding company which, through its subsidiaries, operates in the insurance and risk, financial services and private equity arena. 2. THE ACQUISITION 2.1 Nature of Amecor Amecor, which listed in 2005 in the "Electronic and Electrical Equipment" sector of the main board of the JSE Limited ("JSE"), is the holding company of a number of businesses specialising in the design, manufacture and distribution of electronic security solutions, radio frequency networks, alternative power and power optimisation machinery to the domestic, corporate and industrial sectors in South Africa, neighbouring territories and the overseas market. 2.2 Rationale for the acquisition As an investment holding company, the acquisition signifies an important development in both furthering Conduit`s private equity interests and diversifying the group`s interests in pertinent sectors of the economy. Furthermore, it promotes operational diversity and increases earnings by approximately 0.8 cents per share in terms of the pro forma financial effects calculation as illustrated in section 3. 2.3 Purchase consideration and effective date The 20.5% stake in Amecor was acquired on 10 November 2010, being the effective date of the acquisition, at an average price of 133.19 cents per ordinary share. The total aggregate consideration of R21.294 million was settled in cash from Conduit`s existing cash resources. 2.4 Conditions precedent The acquisition was not subject to any conditions precedent. 3. PRO FORMA FINANCIAL EFFECTS OF THE ACQUISITION The table below sets out the unaudited pro forma financial effects of the acquisition on Conduit`s earnings per share, headline earnings per share, net asset value per share and tangible net asset value per share. The unaudited pro forma financial effects have been prepared to illustrate the impact of the acquisition on the reported financial information of Conduit for the six months ended 28 February 2010, had the acquisition occurred on 1 September 2009 for statement of comprehensive income purposes and on 28 February 2010 for statement of financial position purposes. The unaudited pro forma financial effects have been prepared using accounting policies that comply with International Financial Reporting Standards and that are consistent with those applied in the audited financial statements of Conduit for the year ended 31 August 2009. The unaudited pro forma financial effects, which are the responsibility of the directors, are provided for illustrative purposes only and, because of their pro forma nature, may not fairly present Conduit`s financial position, changes in equity, results of operations or cash flow. Before the After the Change acquisition acquisition (%) Basic earnings per share for 2.78 3.58 28.78 six months (cents) Headline earnings per share for 2.36 3.17 34.32 six months (cents) Net asset value per share 95.06 95.03 (0.03) (cents) Tangible net asset value per 76.57 76.54 (0.04) share (cents) Weighted average number of 250 277 250 277 - shares in issue (000`s) Notes: 1. The amounts in the "Before the acquisition" column have been extracted from the unaudited results of Conduit for the six months ended 28 February 2010. 2. The amounts in the "After the acquisition" column reflect the financial effects of the acquisition on Conduit. 3. The effects on basic earnings per share and headline earnings per share are calculated based on the assumption that the acquisition was effected on 1 September 2009. 4. The effects on net asset value per share and tangible net asset value per share are calculated based on the assumption that the acquisition was effected on 28 February 2010. 4. CLASSIFICATION OF THE ACQUISITION The acquisition is classified as a Category 2 announcement in terms of the Listings Requirements of the JSE. Johannesburg 11 November 2010 Sponsor Merchantec Capital Date: 11/11/2010 15:05:02 Supplied by www.sharenet.co.za Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on, information disseminated through SENS.

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