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GROUP FIVE LIMITED - Update on business rescue proceedings, release of interim results and withdrawal of cautionary announcements

Release Date: 12/04/2019 15:04
Code(s): GRF     PDF:  
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Update on business rescue proceedings, release of interim results and withdrawal of cautionary announcements

Group Five Limited
(Incorporated in the Republic of South Africa)
(Registration number: 1969/000032/06)
Share code: GRF ISIN: ZAE000027405
("Group Five" or "the Company" or "the Group")


Business rescue proceedings

Shareholders are referred to the announcement released on SENS on 12 March 2019 relating to Group
Five and its wholly-owned subsidiary, Group Five Construction Proprietary Limited, having been placed
into business rescue (the “Business Rescue”) in terms of Chapter 6 of the Companies Act, No 71 of
2008 as amended (the “Companies Act”), the simultaneous suspension of the listing of Group Five
shares (the “Suspension”) and the appointment of joint business rescue practitioners (the “Business
Rescue Practitioners”) by the board of directors of Group Five (the “Board”).

The Company, as evidenced by the Business Rescue proceedings, is financially distressed and has
current liabilities which materially outweigh its current assets. This imbalance is currently being
addressed through (inter alia) a moratorium on pre-Business Rescue creditors (as provided for in
Chapter 6 of the Companies Act), post commencement funding provided by a consortium of banks,
negotiations with counterparties, and the disposal of a number of different assets to a multiple of
potential arms’ length purchasers, excluding “related parties” as defined in the JSE Limited (“JSE”)
Listings Requirements (the “Disposals”).

Shareholders are therefore notified that the Company will be undertaking a series of Disposals as part
of the Business Rescue proceedings, such Disposals being conducted in terms of Chapter 6 of the
Companies Act, in order to reduce Group Five’s liabilities, to meet bank lending obligations and to
meet Group Five’s working capital requirements during the Business Rescue proceedings.

Group Five has been consulting with the JSE regarding the application of the provisions of Schedule
11 of the JSE Listings Requirements and has undertaken that it will provide shareholders with monthly
updates on key Disposals, including a basic description of the assets that have been realised during
the period, and other significant milestones in the Business Rescue proceedings. In this regard, the
Business Rescue Practitioners believe that the Disposals to be undertaken will be in the best interests
of the Company and stakeholders as, if not completed, the Company will be unable to meet its
financial commitments and sustain the Business Rescue Proceedings. The Business Rescue
Practitioners further confirm that:

1.   given the urgency of the Disposals, negotiations do not allow time for shareholder approvals;
2.   all alternative methods of financing have been exhausted and the only option remaining is to
     undertake the Disposals;
3.   the Disposals are in the best interests of the Company and stakeholders;
4.   none the Disposals contemplated constitute an 'affected transaction' for purposes of the
     Takeover Regulations. As such the Company has not consulted with the Takeover Regulations
     Panel which does not have any jurisdiction in respect of these processes; and
5.   the Company’s sponsor has confirmed that, in its opinion and on the basis of the information
     available to it, Group Five will not be in a position to meet its obligations as they fall due unless
     the Disposals take place.

Shareholders are advised that the creditors of the Company have approved the extension of the date
of publication of a business rescue plan (the “Business Rescue Plan”) to 28th June 2019. The Business
Rescue Plan will include details of the proposed rescue plan for the Company, as well as (inter alia) a
summary of Disposals effected to date as well as those contemplated to effect the rescue of the

Shareholders are further advised that regular updates and relevant information relating to the
Business Rescue proceedings are available on the Company’s website (

Release of interim results

Shareholders are further advised that Group Five is currently not in a position to release its interim
results for the six months ended 31 December 2018 (“Interim Results”) which were required to be
released by 31 March 2019 in terms of JSE Listings Requirements. The delay in the release of the
Interim Results is linked to the Business Rescue proceedings and shareholders will be updated as to
progress regarding the finalisation of the Interim Results as part of the updates referred to above.

Withdrawal of cautionary announcements

Shareholders are referred to the renewal of cautionary announcements regarding expressions of
interest for various parts of the Group’s businesses and the Kpone Gas- and Oil-fired combined cycle
EPC power plant, released on SENS on 28 February 2019 and 30 January 2019 respectively, and are
advised that due to Group Five having been placed into Business Rescue, the aforementioned
cautionary announcements have been withdrawn with immediate effect.

12 April 2019

Nedbank Corporate and Investment Banking

Date: 12/04/2019 03:04:00 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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