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PSV HOLDINGS LIMITED - Broad-Based Black Economic Empowerment Transaction and Withdrawal of Cautionary Announcement

Release Date: 18/09/2018 14:26
Code(s): PSV     PDF:  
 
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Broad-Based Black Economic Empowerment Transaction and Withdrawal of Cautionary Announcement

PSV Holdings Limited
Incorporated in the Republic of South Africa
(Registration number 1998/004365/06)
Share code: PSV ISIN: ZAE000078705
("PSV" or “the Company”)


BROAD-BASED BLACK ECONOMIC EMPOWERMENT TRANSACTION AND WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT


1. INTRODUCTION

   Further to the cautionary announcement released on SENS on 6 July 2017 and the subsequent renewal
   of cautionary announcements, the last of which was dated 7 September 2018, shareholders are advised
   that PSV, its wholly-owned subsidiaries PSV Industrial Proprietary Limited (“PSV Industrial”) and PSV
   Asset Company Proprietary Limited (“PSV Asset Co”), and Beryl Holdings Partners Proprietary Limited
   (“Beryl”) have entered into a subscription and shareholders agreement (“Agreement”) pursuant to a Broad-
   Based Black Economic Empowerment transaction (“B-BBEE Transaction”).

2. RATIONALE OF THE TRANSACTION

   As part of PSV’s transformation strategy, in terms of which the B-BBEE Transaction constitutes one
   element of the broader strategy, the Company seeks to provide opportunities to historically disadvantaged
   persons to play a meaningful role in South Africa’s industrial revolution. The B-BBEE Transaction has been
   concluded in the spirit and within the guidelines provided in the Broad-Based Black Economic
   Empowerment Act, 2003 (Act No. 53 of 2003) and the B-BBEE Codes of Good Practice as published by
   the Department of Trade and Industry.

   Coupled with the above, the B-BBEE Transaction seeks to introduce strategic long-term B-BBEE
   shareholders who will actively assist PSV in achieving both its growth and transformation targets.

3. DETAILS OF BERYL

   Beryl is a Pan-African diversified investment company, focusing on strategic proprietary investments.
   Beryl’s leadership includes Neverl Kambasha who serves as the Chairman and Dr Reabetswe
   Kgoroeadira who performs the role of Chief Executive Officer.

   Beryl’s investment portfolio includes investments in Logistics, Mining, Energy, Agriculture, Technology and
   Financial Services.

   Beryl is passionate about economic development in Africa and strongly believes that the continent is the
   next frontier, setting the foundation for the organisation’s investment strategy.

   Beryl is a 100% owned black company, 95% of which is female. Beryl, inter alia, acquires shareholdings
   in companies with a proven business model to enable the such companies to comply with black economic
   empowerment legislation and to assist by unlocking and adding value to enable maximum growth potential.

4. SALIENT TERMS OF THE B-BBEE TRANSACTION

   The B-BBEE Transaction has been concluded within the two main operating subsidiaries of PSV, PSV
   Industrial and PSV Asset Co. The B-BBEE Transaction will be implemented as follows:

   4.1. Initial subscription

        In terms of the initial subscription, Beryl will subscribe for:

        •   12 353 PSV Industrial ordinary shares (constituting 15% of the issued ordinary shares in PSV
            Industrial after the issue) for an aggregate subscription price of R4 547 170; and
        •   1 235 PSV Asset Co ordinary shares (constituting 15% of the issued ordinary shares in PSV
            Asset Co after the issue) for an aggregate subscription price of R452 830.

   4.2. “A” share issue

        The authorised share capital of both PSV Industrial and PSV Asset Co will be amended to allow for
        the creation of “A” shares for purposes of the B-BBEE Transaction. In terms of the “A” share issue,
        Beryl will be issued:

        •   17 647 “A” shares in PSV Industrial constituting 100% of the issued “A” shares in PSV Industrial,
            which, together with the ordinary shares in PSV Industrial referred to in 4.1 above, shall
            collectively constitute 30% of all of the issued shares (of both classes of shares) in PSV
            Industrial following the share issues; and
        •   1 765 “A” shares in PSV Asset Co constituting 100% of the issued “A” shares in PSV Asset Co,
            which, together with the ordinary shares in PSV Asset Co referred to in 4.1 above, shall
            collectively constitute 30% of all of the issued shares (of both classes of shares) in PSV Asset
            Co following the share issues.

        The “A” shares will be issued to Beryl at an aggregate nominal subscription price of R100.00.

        The “A” shares will rank pari passu with the PSV Industrial and PSV Asset Co ordinary shares as to
        voting rights and as a result of which, Beryl will be entitled to exercise 30% of all the voting rights in
        each of PSV Industrial and PSV Asset Co.

        At the end of each financial year of both PSV Industrial and PSV Asset Co, a portion of the “A” shares
        as determined in the agreed formula as set out in the Agreement and shall convert to fully paid up
        ordinary shares in the respective companies.

   4.3. Lock-in

        In order to secure the tenure of the B-BBEE ownership credentials and benefits accruing for PSV
        Industrial and PSV Asset Co, Beryl has undertaken not to dispose of any of its shares for a period
        ending on the earlier of 7 years from the effective date and the date upon which all of the “A” shares
        shall have been converted to ordinary shares. In the event that Beryl decides to sell their investment,
        they will be obliged to sell their shares to another B-BBEE entity which is acceptable to PSV.

5. SUSPENSIVE CONDITION AND EFFECTIVE DATE

   The B-BBEE Transaction is subject to the fulfilment of the suspensive condition that by not later than
   12 October 2018, the subscription agreement entered into between PSV and Regis Holdings Limited on
   14 June 2018 becomes unconditional and is duly implemented in accordance with the terms thereof.

   The effective date of the B-BBEE Transaction shall be the business day following the fulfilment of the
   above suspensive condition.

6. FINANCIAL INFORMATION

   The value of the net assets of PSV Industrial and PSV Asset Co at 28 February 2018 was negative
   R1.1 million and positive R5.1 million respectively. The profit after tax attributable to the net assets of PSV
   Industrial and PSV Asset Co for the year ended 28 February 2018 was R1.6 million and R1.1 million
   respectively.

7. APPLICATION OF THE SUBSCRIPTION PROCEEDS

   The proceeds from the subscription, in addition to other initiatives, will be used to restructure the balance
   sheets of both PSV Industrial and PSV Asset Co with the intention to address the long term capital
   structure of the companies and to provide a sustainable funding base for future growth.

8. CLASSIFICATION OF THE B-BBEE TRANSACTION

   The B-BBEE Transaction is classified as a Category 2 disposal in terms of the Listings Requirements of
   JSE Limited.

9. WITHDRAWAL OF CAUTIONARY

   Following the release of this announcement, shareholders are advised that caution is no longer required
   to be exercised when dealing in the Company’s securities.


Johannesburg
18 September 2018

Corporate and Designated Adviser
Merchantec Capital

Date: 18/09/2018 02:26:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
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