Wrap Text
Detailed terms announcement relating to the unwind of the current SAB Zenzele broad-based black economic empowerment
Anheuser-Busch InBev SA/NV
(Incorporated in the Kingdom of Belgium)
Register of Companies Number: 0417.497.106
Euronext Brussels Share Code: ABI
Mexican Stock Exchange Share Code: ANB
NYSE ADS Code: BUD
JSE Share Code: ANH
ISIN: BE0974293251
(“AB InBev”)
DETAILED TERMS ANNOUNCEMENT RELATING TO THE UNWIND OF THE CURRENT SAB
ZENZELE BROAD-BASED BLACK ECONOMIC EMPOWERMENT OWNERSHIP TRANSACTION
AND IMPLEMENTATION OF THE NEW SAB ZENZELE KABILI BROAD-BASED BLACK
ECONOMIC EMPOWERMENT OWNERSHIP TRANSACTION
Highlights
• Current SAB Zenzele transaction unwind will deliver R9.7 billion to participants, the highest BEE
value creation in the FMCG industry
• SAB Zenzele retailer shareholders who invested R100 in 2010 will receive a pre-tax pay-out of
c.R76,000 when the transaction unwinds shortly after 31 March 2020 maturity
• A new BEE ownership transaction will be implemented through a new company called SAB
Zenzele Kabili that will own R5.4 billion worth of AB InBev shares
• SAB Zenzele Kabili will be listed on the BEE Segment of the JSE to facilitate liquidity and broaden
ownership to other BEE investors, including qualifying SAB employees through a new ESOP
• There will be substantial facilitation from SAB through discounted shares and vendor funding of a
minimum term of 10-years
• The transaction will be leveraged through vendor preference share funding at a highly cost-
effective funding rate of 70% of prime
1. INTRODUCTION AND BACKGROUND
In 2010, SABMiller plc (through its South African subsidiary, The South African Breweries
Proprietary Limited (“SAB”)) implemented a broad-based black economic empowerment (“BEE”)
ownership transaction known as SAB Zenzele (“Existing Empowerment Transaction”).
Amongst other things, the Existing Empowerment Transaction involved SAB issuing:
• approximately 3.52% of its total issued shares to SAB Zenzele Holdings Limited (“SAB
Zenzele”), which in turn offered to issue ordinary shares in the share capital of SAB
Zenzele to qualifying black people who were, at the time, retail liquor licence holders,
retail liquor licence applicants or registered customers of ABI, which was at the time the
soft drinks division of SAB (“SAB Zenzele Retailer Shareholders”);
• approximately 3.39% of its total issued shares to The SAB Zenzele Employee Trust
(“Current ESOP”), which holds such shares for the benefit of certain qualifying employees
of SAB and its subsidiaries and associated companies; and
• approximately 1.54% of its total issued shares to The SAB Foundation.
The Existing Empowerment Transaction is due to unwind shortly after its 31 March 2020 maturity
in accordance with the amended agreements entered into following the combination of SABMiller
plc and Anheuser-Busch Inbev SA/NV (“AB InBev”) in 2016. Participants in the Existing
Empowerment Transaction will receive R9.7 billion worth of ordinary shares in the share capital
of AB InBev (“AB InBev Shares”), or the cash proceeds from the disposal of such AB InBev
Shares (less associated taxes and costs), as determined in accordance with the formula set out
in the aforementioned agreements.
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SAB has received consistent feedback from the SAB Zenzele Retailer Shareholders that they
wish to be provided with an opportunity to re-invest some or all of the value to which they will be
entitled to on the unwind of the Existing Empowerment Transaction.
Accordingly, AB InBev is proposing, in conjunction with the contemplated unwind of the Existing
Empowerment Transaction, the implementation of a new R5.4 billion BEE ownership transaction
(“New Empowerment Transaction”) through a new company called SAB Zenzele Kabili
Holdings (RF) Limited (“SAB Zenzele Kabili”). Participants in the New Empowerment
Transaction will include the SAB Zenzele Retailer Shareholders, beneficiaries of the Current
ESOP that choose to re-invest, The SAB Foundation and qualifying employees of SAB through
a new employment share option plan (“New ESOP”).
As part of unwinding the Existing Empowerment Transaction and facilitating the implementation
of the New Empowerment Transaction, the board of directors of SAB Zenzele (“SAB Zenzele
Board”) has resolved that the most efficient and effective way to facilitate the principal further re-
investment by the c.29,000 SAB Zenzele Retailer Shareholders in the New Empowerment
Transaction, is through a scheme of arrangement in terms of section 114 of the Companies Act,
No 71 of 2008, as amended (“Companies Act”), (“SAB Zenzele Scheme”), proposed between
SAB Zenzele and the SAB Zenzele Retailer Shareholders. SAB Zenzele has accordingly
concluded a transaction implementation agreement with, amongst others, AB InBev, SAB and
SAB Zenzele Kabili, setting out the terms and conditions on which the New Empowerment
Transaction will be implemented.
The SAB Zenzele Scheme constitutes an “affected transaction” as defined in section 117(1)(c)(iii)
of the Companies Act, and as such, the SAB Zenzele Scheme is regulated by the Companies Act
and applicable Takeover Regulations (contained in Chapter 5 of the Companies Regulations,
2011) (“Takeover Regulations”).
In connection with proposing the SAB Zenzele Scheme and convening the relevant shareholders’
meeting to approve the special resolutions required to approve implementation of the SAB
Zenzele Scheme (“Shareholders’ Meeting”), SAB Zenzele has prepared a circular to its
shareholders in accordance with the relevant disclosure requirements under the Companies Act
and the applicable Takeover Regulations, which circular incorporates a notice convening the
relevant Shareholders’ Meeting for purposes of proposing for approval the relevant resolutions
required to implement the SAB Zenzele Scheme, and providing SAB Zenzele Retailer
Shareholders with the necessary statutorily-required information regarding the SAB Zenzele
Scheme (“SAB Zenzele Scheme Circular”). The SAB Zenzele Scheme Circular will be posted
to SAB Zenzele Retailer Shareholders on 19 February 2020, and will also be available on SAB
Zenzele’s website, http://www.sab.co.za/sab-zenzele.
If the SAB Zenzele Scheme becomes operative, each SAB Zenzele Retailer Shareholder will
have ceded 15% of its entitlements to receive AB InBev Shares under the Existing Empowerment
Transaction (such full entitlements, the “Settlement Entitlements”) to SAB Zenzele Kabili in
exchange for ordinary shares in the share capital of SAB Zenzele Kabili (“SAB Zenzele Kabili
Ordinary Shares”) of proportional value (“Scheme Consideration”).
In addition, SAB Zenzele Kabili will make an offer to SAB Zenzele Retailer Shareholders and the
beneficiaries of the Current ESOP (“Qualifying Investors”) to re-invest all or a further portion of
their Settlement Entitlement (subject to certain parameters described below and, in the case of
SAB Zenzele Retailer Shareholders, after taking into account the 15% of the Settlement
Entitlements re-invested through the SAB Zenzele Scheme (such 15% of the full entitlements,
the “Scheme Entitlements”)), into SAB Zenzele Kabili (“Reinvestment Offer”) in exchange for
further SAB Zenzele Kabili Ordinary Shares of proportional value.
Simultaneously with, or shortly after the implementation of the SAB Zenzele Scheme, SAB
Zenzele Kabili will be listed on the BEE Segment of the JSE, to create liquidity and allow trading
of SAB Zenzele Kabili Ordinary Shares from the outset with other BEE investors (“BEE Listing”).
In connection with the Reinvestment Offer and the BEE Listing, SAB Zenzele Kabili has prepared
a prospectus in compliance with the applicable substance and form requirements for a prospectus
set out in the Companies Act and the Companies Regulations, 2011 and applicable pre-listing
statement requirements of the JSE Limited (“JSE Listings Requirements”) (“SAB Zenzele
Kabili Prospectus”).
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2. SALIENT DETAILS OF THE UNWIND OF THE EXISTING EMPOWERMENT TRANSACTION
If the SAB Zenzele Scheme becomes operative, Qualifying Investors will have the opportunity to
re-invest all or a portion of their Settlement Entitlements into SAB Zenzele Kabili, subject to
certain parameters described below. In respect of the remaining Settlement Entitlements (after
taking into account any portion thereof which is ceded to SAB Zenzele Kabili pursuant to the SAB
Zenzele Scheme and/or the Reinvestment Offer), each Qualifying Investor will be entitled to elect
to be settled as follows (“Settlement Election”):
• cash, whereby their remaining Settlement Entitlements will be sold on their behalf and they
will receive the cash proceeds arising from such sale, less associated taxes and costs
(“Sale Proceeds Settlement”); and/or
• AB InBev Shares, whereby the remaining Settlement Entitlements will be settled in AB
InBev Shares (“AB InBev Shares Settlement”).
The SAB Zenzele Board wishes to draw to the attention of the SAB Zenzele Retailer
Shareholders that their right to receive the Sale Proceeds Settlement and/or the AB InBev
Shares Settlement (depending on their election) upon unwind of the Existing Empowerment
Transaction is not conditional on the approval of the SAB Zenzele Scheme, save that if the
relevant resolutions are not approved, SAB Zenzele Retailer Shareholders who are entitled to
less than 100 AB InBev Shares upon the unwind of the Existing Empowerment Transaction will,
consistent with the current memorandum of incorporation of SAB Zenzele (“SAB Zenzele MOI”),
be deemed to have elected the Sale Proceeds Settlement.
Although the entitlement to the AB InBev Shares upon the unwind of the Existing Empowerment
Transaction (and by necessary extension the Settlement Election) is not conditional on the SAB
Zenzele Scheme becoming operative, the value of the AB InBev Shares that each Qualifying
Investor is entitled to is contingent on the SAB Zenzele Scheme and the Reinvestment Offer.
Accordingly, the following two scenarios will impact on how the Settlement Election is applicable
to a Qualifying Investor:
I. if the SAB Zenzele Scheme is approved and the New Empowerment Transaction, which
includes the Reinvestment Offer, is implemented:
• If you are a SAB Zenzele Retailer Shareholder, your Scheme Entitlement (being 15%
of your full Settlement Entitlement) will be automatically ceded to SAB Zenzele Kabili
under the SAB Zenzele Scheme and you will be left with 85% of your Settlement
Entitlement, minus whatever portion thereof you elect to re-invest into SAB Zenzele
Kabili under the Reinvestment Offer (if any); or
• If you are a beneficiary of the Current ESOP, you will be entitled to elect the Sale
Proceeds Settlement or the AB InBev Shares Settlement in respect of 100% of your
Settlement Entitlement minus whatever portion thereof you elect to re-invest into SAB
Zenzele Kabili under the Reinvestment Offer (if any).
II. if the SAB Zenzele Scheme is not approved and the New Empowerment Transaction, which
includes the Reinvestment Offer, is not implemented:
The Existing Empowerment Transaction will unwind in accordance with its terms. In
particular, you will receive the full Settlement Entitlement that you are entitled to receive
under the Existing Empowerment Transaction (in accordance with your Settlement
Election) and you will not have the opportunity to re-invest all or part of their Settlement
Entitlement in the New Empowerment Transaction.
For the avoidance of doubt, consistent with the terms of the SAB Zenzele MOI, if the
relevant shareholder resolutions are not approved, a SAB Zenzele Retailer Shareholder
who is entitled to less than 100 AB InBev Shares on the unwind of the Existing
Empowerment Transaction shall only be entitled to receive the cash proceeds (less
associated taxes and costs) arising from a sale of those AB InBev Shares pursuant to the
unwind of the Existing Empowerment Transaction.
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3. SALIENT DETAILS OF THE NEW EMPOWERMENT TRANSACTION
3.1 SUMMARY OF KEY ELEMENTS
AB InBev and SAB intend to implement the New Empowerment Transaction, subject to the
SAB Zenzele Scheme becoming operative, through the establishment of SAB Zenzele Kabili,
by means of the following key elements:
• each SAB Zenzele Retailer Shareholder will re-invest their Scheme Entitlement (being
15% of their full Settlement Entitlement) into SAB Zenzele Kabili in exchange for SAB
Zenzele Kabili Ordinary Shares of proportional value in terms of the SAB Zenzele Scheme,
as described in greater detail in paragraph 3.2 below;
• offering (i) the beneficiaries of the Current ESOP the ability to re-invest all or a portion of
their Settlement Entitlement, subject to certain parameters described below, in exchange
for SAB Zenzele Kabili Ordinary Shares of proportional value; and (ii) SAB Zenzele
Retailer Shareholders the ability to re-invest all or a portion of their remaining Settlement
Entitlement (subject to certain parameters described below and after taking into account
the Scheme Entitlement ceded to SAB Zenzele Kabili pursuant to the SAB Zenzele
Scheme) into SAB Zenzele Kabili in exchange for SAB Zenzele Kabili Ordinary Shares of
proportional value, in terms of the Reinvestment Offer described in greater detail in
paragraph 3.3 below;
• SAB will contribute the equivalent of R600 million worth of AB InBev Shares to SAB
Zenzele Kabili on behalf of the New ESOP;
• SAB will contribute the equivalent of R120 million worth of AB InBev Shares to the New
ESOP. The New ESOP will sell these AB InBev Shares and use the proceeds to acquire
SAB Zenzele Kabili Ordinary Shares from those SAB Zenzele Retailer Shareholders who
voted against the SAB Zenzele Scheme and wish to dispose of their SAB Zenzele Kabili
Ordinary Shares or, failing that, to acquire further SAB Zenzele Kabili Ordinary Shares in
the market;
• The SAB Foundation has committed to re-invest into SAB Zenzele Kabili the equivalent of
up to R400 million worth of AB InBev Shares (c. 21% of its Settlement Entitlement), of
which R344 million will be used upon listing to acquire SAB Zenzele Kabili Ordinary
Shares. The balance will be used to acquire SAB Zenzele Kabili Ordinary Shares from
SAB Zenzele Retailer Shareholders who voted against the SAB Zenzele Scheme and wish
to dispose of their SAB Zenzele Kabili Ordinary Shares or, failing that, to acquire additional
SAB Zenzele Kabili Ordinary Shares in the market;
• SAB will contribute the equivalent of R2 973 million worth of AB InBev Shares to SAB
Zenzele Kabili, and in return SAB Zenzele Kabili will issue preference shares to SAB,
representing vendor funding of R2 973 million; and
• SAB will contribute the equivalent of R811 million worth of AB InBev Shares (as at 31
March 2020) at no further cost to SAB Zenzele Kabili (“Discount Shares”) to further
enhance the capital structure of SAB Zenzele Kabili.
SAB Zenzele Kabili has sufficient authorised but unissued SAB Zenzele Kabili Ordinary
Shares to settle the various components of the New Empowerment Transaction as described
above.
3.2 THE SAB ZENZELE SCHEME
In terms of the SAB Zenzele Scheme, SAB Zenzele Kabili as offeror, will acquire the Scheme
Entitlements (being 15% of the full Settlement Entitlements) from the SAB Zenzele Retailer
Shareholders for the Scheme Consideration. The operation of the SAB Zenzele Scheme is
subject to the fulfillment or, where appropriate, waiver, of the conditions precedent as
described in paragraph 5.1 below.
If the SAB Zenzele Scheme becomes operative it will be binding on all the SAB Zenzele
Retailer Shareholders (irrespective of whether a SAB Zenzele Retailer Shareholder voted in
favour of the Scheme or not) and:
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• each SAB Zenzele Retailer Shareholder will be deemed, with effect from the
implementation date of the SAB Zenzele Scheme, to have ceded its Scheme Entitlements
(and disposed of the AB InBev Shares underlying the Scheme Entitlements), free and
clear of encumbrances, to SAB Zenzele Kabili;
• SAB Zenzele Kabili will be deemed to have acquired all the Scheme Entitlements (and
the registered and beneficial ownership of the AB InBev Shares underlying the Scheme
Entitlements) without any further act or instrument being required, for the Scheme
Consideration; and
• each SAB Zenzele Retailer Shareholder who will have become entitled to less than 100
AB InBev Shares upon the unwind of the Existing Empowerment Transaction and
consequently will have received a cash settlement pursuant to the sale of such AB InBev
Shares in accordance with the transaction terms will be deemed, with effect from the
implementation date of the SAB Zenzele Scheme, to have waived its rights to be cash
settled and shall be deemed to have consented to a settlement pursuant to the terms of
the SAB Zenzele Scheme.
In consideration for the cession of the Scheme Entitlements, each SAB Zenzele Retailer
Shareholder will be entitled to receive the Scheme Consideration (being such number of SAB
Zenzele Kabili Shares as are proportional to the Scheme Entitlements ceded by such SAB
Zenzele Retailer Shareholders to SAB Zenzele Kabili under the SAB Zenzele Scheme),
subject to the terms and conditions of the SAB Zenzele Scheme Circular.
SAB Zenzele Retailer Shareholders are advised to refer to the SAB Zenzele Scheme Circular
for the full terms and conditions of the SAB Zenzele Scheme.
3.3 THE REINVESTMENT OFFER AND BEE LISTING
In the event the SAB Zenzele Scheme becomes operative, SAB Zenzele Retailer
Shareholders will have the ability to re-invest all or a portion of their remaining Settlement
Entitlement (subject to certain parameters described below and after taking into account the
15% ceded to SAB Zenzele Kabili pursuant to the SAB Zenzele Scheme) into SAB Zenzele
Kabili in exchange for additional SAB Zenzele Kabili Ordinary Shares of proportional value
pursuant to the Reinvestment Offer. Furthermore, beneficiaries of the Current ESOP have the
ability to re-invest all or a portion of their Settlement Entitlement, subject to certain parameters
described below, in exchange for SAB Zenzele Kabili Ordinary Shares of proportional value.
The number of SAB Zenzele Kabili Ordinary Shares being offered by SAB Zenzele Kabili
pursuant to the Reinvestment Offer is capped at 8.6 million SAB Zenzele Kabili Ordinary
Shares or an aggregate Rand amount of R344 million. Accordingly, it is possible that a SAB
Zenzele Retailer Shareholder who applies for SAB Zenzele Kabili Ordinary Shares pursuant
to the Reinvestment Offer may not be allocated the full number of SAB Zenzele Kabili Ordinary
Shares that they applied for. Further details of these allocation principles will be set out in the
SAB Zenzele Kabili Prospectus.
Simultaneously with, or shortly after, implementation of the SAB Zenzele Scheme, SAB
Zenzele Kabili will be listed on the BEE Segment of the JSE pursuant to the BEE Listing,
thereby facilitating trading and liquidity for the participants of the New Empowerment
Transaction who wish to, and are entitled to, trade their SAB Zenzele Kabili Ordinary Shares.
In this respect, the JSE has granted SAB Zenzele Kabili, subject to the SAB Zenzele Scheme
becoming operative, a listing on the BEE Segment of the JSE, under share code “SZK”, ISIN
code ZAE000284196 and the abbreviated name SAB Zenzele Kabili with effect from the
commencement of business on Wednesday, 15 April 2020.
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For this purpose, the SAB Zenzele Kabili Prospectus, which provides additional details of the
New Empowerment Transaction, the Reinvestment Offer and the BEE Listing will be issued
and sent to the Qualifying Investors on 19 February 2020 and will also accompany the SAB
Zenzele Scheme Circular, which will be posted to SAB Zenzele Retailer Shareholders on 19
February 2020. The SAB Zenzele Prospectus will also be available on SAB Zenzele Kabili’s
website, www.investecsps.co.za.
3.4 FUNDING THE NEW EMPOWERMENT TRANSACTION
The table below sets out the sources and uses of funding to establish the New Empowerment
Transaction:
Sources of funding Rm %
Discount Shares 811 15.0
Equity contribution – SAB Zenzele Retailer Shareholders 678 12.5
Equity contribution by SAB - New ESOP1 600 11.1
Equity contribution – The SAB Foundation2 344 6.4
Vendor funding from SAB 2 973 55.0
Total 5 406 100
Uses of funding Rm %
Acquisition of AB InBev Shares 5 406 100
Total 5 406 100
Notes:
1. SAB will make a contribution of R720 million to the New ESOP, of which R600 million will be utilised to acquire
SAB Zenzele Kabili Ordinary Shares. The balance of the contribution will be used by the New ESOP to: (i) acquire
SAB Zenzele Kabili Ordinary Shares from SAB Zenzele Retailer Shareholders who voted against the SAB Zenzele
Scheme and wish to dispose of their SAB Zenzele Kabili Ordinary Shares; or (ii) acquire further SAB Zenzele
Kabili Ordinary Shares in the market; and
2. The SAB Foundation has committed to re-invest up to R400 million, of which R344 million will be used upon listing
to acquire SAB Zenzele Kabili Ordinary Shares. The balance will be used to: (i) acquire SAB Zenzele Kabili
Ordinary Shares from SAB Zenzele Retailer Shareholders who voted against the SAB Zenzele Scheme and wish
to dispose of their SAB Zenzele Kabili Ordinary Shares; or (ii) acquire additional SAB Zenzele Kabili Ordinary
Shares in the market.
4. ILLUSTRATIVE EXAMPLE OF THE IMPACT OF THE SAB ZENZELE SCHEME ON SAB
ZENZELE RETAILER SHAREHOLDERS
In order to enable SAB Zenzele Retailer Shareholders to assess the impact of the SAB Zenzele
Scheme and broader participation in the New Empowerment Transaction and understand the
proportional value to be received pursuant to the SAB Zenzele Scheme and any participation in
the Reinvestment Offer, the worked example below has been prepared for illustrative purposes
only.
The worked examples below illustrate the impact of the SAB Zenzele Scheme on a SAB Zenzele
Retailer Shareholder that invested R100 or R2 500 in 2010. SAB Zenzele Kabili Ordinary Shares
will be issued at a subscription price of R40 per share. The number of SAB Zenzele Kabili
Ordinary Shares to be issued to a SAB Zenzele Retailer Shareholder will be determined by
dividing the 15% Scheme Entitlement by the R40 subscription price.
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The worked examples are based on reasonable assumptions and estimates as set out below.
Example 1 – SAB Zenzele Retailer Shareholder that invested R100 in 2010
Before the SAB Zenzele Scheme / if the SAB Zenzele Scheme is unsuccessful
Sale Proceeds AB InBev Shares
Settlement Settlement
Amount invested in 2010 R 100 R 100
Number of SAB Zenzele shares
acquired in 2010 317 317
Value at unwind date1 R 76 738 R 76 738
• Reinvested into SAB Zenzele 0% R0 R0
Kabili2
• Distributed to SAB Zenzele 100% R 76 738 R 76 738
Retailer Shareholders3
SAB Zenzele Kabili Ordinary - -
Shares received4
AB InBev Shares received5 - 69
Value received R 76 738 R 76 738
• Value of SAB Zenzele Kabili R0 R0
Ordinary Shares7
R0 R 76 704
• Value of AB InBev Shares8
R 76 738 R 34
• Cash9
After the SAB Zenzele Scheme / if the SAB Zenzele Scheme is successful
Sale Proceeds AB InBev Shares
Settlement Settlement
Amount invested in 2010 R 100 R 100
Number of SAB Zenzele shares
acquired in 2010 317 317
Value at unwind date1 R 76 738 R 76 738
• Reinvested into SAB 15% R11 511 R11 511
Zenzele Kabili2, 6
• Distributed to SAB Zenzele 85% R65 227 R65 227
Retailer Shareholders3
SAB Zenzele Kabili Ordinary 287 287
Shares received4
AB InBev Shares received5 - 58
Value received R 82 478 R 82 478
• Value of SAB Zenzele Kabili R 17 220 R 17 220
Ordinary Shares7
R0 R 64 476
• Value of AB InBev Shares8
R 65 258 R782
• Cash9
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Example 2 – SAB Zenzele Retailer Shareholder that invested R2 500 in 2010
Before the SAB Zenzele Scheme / If the SAB Zenzele Scheme is unsuccessful
Sale Proceeds AB InBev Shares
Settlement Settlement
Amount invested in 2010 R 2 500 R 2 500
Number of SAB Zenzele shares
acquired in 2010 634 634
Value at unwind date1 R 153 476 R 153 476
• Reinvested into SAB Zenzele 0% R0 R0
Kabili2
• Distributed to SAB Zenzele 100% R153 476 R153 476
Retailer Shareholders3
SAB Zenzele Kabili Ordinary
Shares received4 - -
AB InBev Shares received5 - 138
Value received R 153 476 R 153 476
• Value of SAB Zenzele Kabili R0 R0
Ordinary Shares7
R0 R 153 408
• Value of AB InBev Shares8
R 153 476 R 68
• Cash9
After the SAB Zenzele Scheme / If the SAB Zenzele Scheme is successful
Sale Proceeds AB InBev Shares
Settlement Settlement
Amount invested in 2010 R 2 500 R 2 500
Number of SAB Zenzele shares
acquired in 2010 634 634
Value at unwind date1 R 153 476 R 153 476
• Reinvested into SAB 15% R23 021 R23 021
Zenzele Kabili2, 6
• Distributed to SAB Zenzele 85% R130 455 R130 455
Retailer Shareholders3
SAB Zenzele Kabili Ordinary
Shares received4 575 575
AB InBev Shares received5 - 117
Value received R 164 976 R 164 976
• Value of SAB Zenzele Kabili R 34 500 R 34 500
Ordinary Shares7
R0 R 130 063
• Value of AB InBev Shares8
R 130 476 R413
• Cash9
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Notes and assumptions:
1. Current unwind value calculated based on the provisions of the Amended and Restated Exchange Agreement between AB
InBev, SAB, SABMiller plc, SAB Zenzele, the Current ESOP and The SAB Foundation using a fixed price of GBP45 per
SABMiller plc share, adjusted for inflation over time and reduced by the: (i) notional funding repaid as per the repurchase
mechanism, (ii) R625m upfront special dividend paid in November 2016, (iii) R76m Distell disposal dividend paid in May
2017 and (iv) R312m CCBA disposal dividend paid in December 2017.
2. Current unwind value multiplied by reinvestment percentage
3. Current unwind value less reinvestment into SAB Zenzele Kabili. SAB Zenzele Retailer Shareholder given election on how
the balance of the Settlement Entitlement is delivered (i.e. cash proceeds of sale of AB InBev Shares on the open market
(less associated taxes and costs) or AB InBev Shares)
4. Reinvested value divided by SAB Zenzele Kabili issue price of R40 per SAB Zenzele Kabili Ordinary Share
5. Distributed value divided by an assumed AB InBev market value of R1 112 per AB InBev Share (where applicable)
6. Regardless of election
7. SAB Zenzele Kabili Ordinary Shares received multiplied by SAB Zenzele Kabili net asset value of R60 per SAB Zenzele
Kabili Ordinary Share. For every R1.00 of equity invested by a SAB Zenzele Retailer Shareholder, SAB will contribute R0.50
in the form of an incentive discount
8. AB InBev Shares received multiplied by an assumed AB InBev market value of R1 112 per AB InBev Share
9. Unwind value less value of AB InBev Shares received
10. The above is before taxes and other related transaction costs and expenses
5. CONDITIONS PRECEDENT
5.1 THE SAB ZENZELE SCHEME
The implementation of the SAB Zenzele Scheme is subject to the fulfilment or, where
appropriate, waiver of the following conditions (“Scheme Conditions”), which must be fulfilled
(or deemed fulfilled), or where appropriate, waived, on or before 17:00 on Friday, 3 April 2020
(“Long Stop Date”), (or such later time and/or date as may be agreed in writing between SAB
and SAB Zenzele (and approved by the Takeover Regulation Panel (“TRP”)) (“Extended
Long Stop Date”):
I. the approval of certain amendments to the SAB Zenzele MOI by the requisite majority of
votes of the SAB Zenzele Retailer Shareholders, as required in terms of section 16(1)(c) of
the Companies Act, as will be described in more detail in the Notice of Shareholder Meeting
in the SAB Zenzele Scheme Circular;
II. the approval of the Scheme by the requisite majority of votes of the SAB Zenzele Retailer
Shareholders, as required in terms of section 114(1) and section 115(2)(a) of the
Companies Act (“Scheme Resolution”), as will be described in more detail in the Notice
of Shareholder Meeting contained in the SAB Zenzele Scheme Circular;
III. the receipt of unconditional approvals, consents or waivers from all applicable regulatory
authorities as may be required in order to implement the SAB Zenzele Scheme and the
BEE Listing, including, but not limited to, approvals from the TRP (including the compliance
certificate to be issued by the TRP in relation to the SAB Zenzele Scheme as required by
section 115(1)(b) read with section 119(4)(b) and section 121(b) of the Companies Act) and
the JSE, and, to the extent that any such approvals, consents or waivers are subject to
conditions, in each case on terms and conditions reasonably satisfactory to SAB Zenzele
Kabili and SAB Zenzele;
IV. the Scheme Resolution not being opposed by 15% or more of the voting rights exercised
on such resolution; or should the Scheme Resolution be opposed by 15% or more of the
voting rights exercised on it:
a. no person who voted against the Scheme Resolution requiring SAB Zenzele to
seek the approval of the Court in terms of section 115(3) of the Companies Act; or
b. if a person who voted against the Scheme Resolution requires SAB Zenzele to
seek the approval of the Court in terms of section 115(3) of the Companies Act,
then:
i. the SAB Zenzele Scheme being approved by the Court unconditionally, or
if subject to conditions, the person on whom such conditions are imposed
approves such conditions and undertakes in writing to comply therewith;
and
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ii. SAB Zenzele not treating the Scheme Resolution as a nullity in terms of
section 115(5)(b) of the Companies Act;
V. no leave is granted by the Court, pursuant to section 115(3)(b) of the Companies Act, to
any person who voted against the Scheme Resolution and who applied to the Court for a
review of the Scheme; and
VI. with regard to any SAB Zenzele Retailer Shareholders exercising appraisal rights, within
the period prescribed under section 164(7) of the Companies Act, no valid demands having
been received by, or remain capable of being given to, SAB Zenzele in terms of such
section which in aggregate represent more than 5% of the SAB Zenzele shares in issue.
The Scheme Conditions set out in (I) to (V) above (both inclusive) are not capable of waiver.
The Scheme Condition set out in (VI) is for the benefit of SAB Zenzele. SAB Zenzele is entitled
at any time prior to the Long Stop Date, or the Extended Long Stop Date, to waive compliance
with such Scheme Condition. An announcement will be published in the South African press
as soon as possible after the fulfilment, waiver or non-fulfilment, as the case may be, of the
Scheme Conditions.
For the avoidance of doubt, if the Scheme Conditions are not fulfilled or waived (to the extent
possible) by the Long Stop Date, or the Extended Long Stop Date, then the SAB Zenzele
Scheme will not become operative and the New Empowerment Transaction will not proceed.
Consequently, Qualifying Investors will continue in their present position as participants in the
Existing Empowerment Scheme, which will unwind in accordance with its terms. In particular,
Qualifying Investors will receive their full Settlement Entitlement and they will not have the
benefit of re-investing all or part of it as contemplated under the New Empowerment
Transaction.
5.2 THE NEW EMPOWERMENT TRANSACTION
The implementation of the balance of the New Empowerment Transaction, including the BEE
Listing, is subject to the suspensive condition that the SAB Zenzele Scheme becomes
unconditional and operative.
6. SALIENT DATES AND TIMES
Set out below are the salient dates and times pertaining to the SAB Zenzele Scheme:
2020
Posting record date for purposes of receiving the SAB Zenzele Scheme Circular Friday, 14 February
Terms announcement published in the South African press Tuesday, 18 February
SAB Zenzele Scheme Circular posted to SAB Zenzele Retailer Shareholders Wednesday, 19 February
Record date for attending and voting at the Shareholders’ Meeting Friday, 13 March
Last day and time to give notice to participate in the Shareholders’ Meeting Monday, 16 March
electronically by 10:00 on
For administrative purposes, form of proxy (pink) for Shareholders’ Meeting Tuesday, 17 March
should be received by 10:00 on
Last day for any SAB Zenzele Retailer Shareholders to deliver a written notice to Thursday, 19 March
SAB Zenzele objecting to the Scheme Resolution in accordance with section
164(3) of the Companies Act by 10:00 on
Shareholders’ Meeting held at Johannesburg Expo Centre, in Nasrec at 10:00 on Thursday, 19 March
Results of Shareholders’ Meeting published in South African press Wednesday, 25 March
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If the SAB Zenzele Scheme is duly approved by SAB Zenzele Retailer Shareholders at the
Shareholders’ Meeting:
Last date for SAB Zenzele Retailer Shareholders who voted against the SAB Thursday, 26 March
Zenzele Scheme to require SAB Zenzele to seek Court approval for the SAB
Zenzele Scheme in terms of section 115(3)(a) of the Companies Act, if the
Scheme Resolution was opposed by at least 15% of the voting rights that were
exercised
Last date for SAB Zenzele Retailer Shareholders who voted against the Scheme Thursday, 2 April
Resolution to be granted leave by a Court to apply for a review of the SAB
Zenzele Scheme in terms of section 115(3)(b) of the Companies Act
Last date for SAB Zenzele to give notice of adoption of the Scheme Resolution Thursday, 2 April
(in terms of section 115 of the Companies Act) approving the SAB Zenzele
Scheme in terms of section 164(4) of the Companies Act to SAB Zenzele Retailer
Shareholders who delivered written notices to SAB Zenzele objecting to the
relevant special resolution in accordance with section 164 of the Companies Act
If no SAB Zenzele Retailer Shareholders exercise their rights in terms of section 115(3) of the
Companies Act and all the Scheme Conditions are satisfied:
Expected date for TRP compliance certificate delivered in terms of section 121(b) Friday, 3 April
of the Companies Act
Election due date on which SAB Zenzele Retailer Shareholders’ must deliver their Friday, 3 April
Settlement Election to SAB Zenzele by 12:00 on
Expected SAB Zenzele Scheme record date, being the date and time on which Tuesday, 7 April
SAB Zenzele Retailer Shareholders’ must be recorded in the register to receive
the Scheme Consideration, which is expected to be by 17:00 on
SAB Zenzele Scheme implementation date expected to be Wednesday, 15 April
SAB Zenzele Kabili expected to have AB InBev Shares (underlying the Scheme Wednesday, 15 April
Entitlements) credited to its nominated dematerialised securities account
Expected date on which SAB Zenzele Retailer Shareholders having elected the Wednesday, 15 April
Sale Proceeds Settlement, will have their bank accounts settled
Listing of SAB Zenzele Kabili expected from commencement of trade Wednesday, 15 April
Scheme Qualifying Investors expected to receive Scheme Consideration, being Wednesday, 15 April
the date on which SAB Zenzele Kabili Ordinary Shares (and/or additional SAB
Zenzele Kabili Ordinary Shares pursuant to the Reinvestment Offer) are credited
to dematerialised accounts opened with the SAB Zenzele Kabili adminsitrator or
their brokerage accounts
Notes:
1. All times shown in this announcement are South African Standard Time, unless otherwise stated;
2. The above dates and times are subject to amendment. Any material amendment will be published in the South
African press;
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3. If the Shareholders’ Meeting is adjourned or postponed, forms of proxy submitted for the Shareholders’
Meeting will remain valid in respect of any adjournment or postment of the Shareholders’ Meeting, unless the
contrary is stated on the relevant form of proxy; and
4. To the extent that a form of proxy is not received by 10:00 on Tuesday, 17 March 2020, as envisaged in the
table above, the form of proxy may be handed to the chairperson of the Shareholders’ Meeting, prior to the
commencement of the meeting.
7. INDEPENDENT EXPERT REPORT AND SAB ZENZELE BOARD RECOMMENDATION
BDO Corporate Finance Proprietary Limited ("Independent Expert”) has been appointed as the
independent expert by the SAB Zenzele Board, to assess the terms and conditions of the SAB
Zenzele Scheme as well as the Scheme Consideration as required in terms of section 114 of the
Companies Act and Regulation 90 and 110 of the Companies Regulations (“Independent Expert
Report”).
Having considered the terms and conditions of the SAB Zenzele Scheme and based upon and
subject to the terms and conditions set out in the Independent Expert Report, the Independent
Expert is of the opinion that the SAB Zenzele Scheme and Scheme Consideration are fair and
reasonable to the SAB Zenzele Retailer Shareholders.
SAB Zenzele has constituted an independent board (“Independent Board”), comprised of Mr.
PM Maduna, Mr. SL Mbatha and Mr. J Awbrey, being the directors that SAB Zenzele has
indicated are independent directors as envisaged in Regulation 81 of the Companies
Regulations.
The Independent Board has considered the terms and conditions of the SAB Zenzele Scheme
and, taking into account the Independent Expert Report, is of the opinion that the terms and
conditions of the Scheme are both fair and reasonable to SAB Zenzele Retailer Shareholders
and recommends that SAB Zenzele Retailer Shareholders vote in favour of the SAB Zenzele
Scheme at the Shareholders’ Meeting.
8. MEETING OF SAB ZENZELE RETAILER SHAREHOLDERS
The SAB Zenzele Scheme Circular will be posted to SAB Zenzele Retailer Shareholders on
19 February 2020 (and will also be available on SAB Zenzele’s website, www.sab.co.za/sab-
zenzele), and contains the notice to convene the relevant Shareholders’ Meeting to be held at
Johannesburg Expo Centre, Corner Nasrec and Randshow Roads at 10:00 (South African
Standard Time) on Thursday, 19 March 2020 for the purpose of considering and, if deemed fit,
passing with or without modification, the relevant special resolutions required to implement the
SAB Zenzele Scheme, as described in more detail in paragraph 5 above and in the SAB Zenzele
Scheme Circular.
9. DIRECTORS’ RESPONSIBILITY STATEMENT
The SAB Zenzele Board individually and collectively accept full responsibility for the accuracy of
the information contained in this announcement to the extent that it relates solely to SAB Zenzele.
In addition, the SAB Zenzele Board certifies that to the best of its knowledge and belief, the
information contained in this announcement solely pertaining to SAB Zenzele is true and, where
appropriate, does not omit anything that is likely to affect the importance of the information
contained herein solely pertaining to SAB Zenzele, and that all reasonable enquiries to ascertain
such information has been made.
The members of the Independent Board individually and collectively accept full responsibility for
the accuracy of the information given and certify that, to the best of their knowledge and belief,
no facts have been omitted that would make any statement in this announcement false or
misleading or be likely to affect the importance of the information, and that all reasonable
enquiries to ascertain such facts have been made and that this announcement contains all
information required by law and the Takeover Regulations.
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The directors of SAB Zenzele Kabili individually and collectively accept full responsibility for the
accuracy of the information contained in this announcement to the extent that it relates solely to
SAB Zenzele Kabili. In addition, the board of directors of SAB Zenzele Kabili certifies that to the
best of its knowledge and belief, the information contained in this announcement solely pertaining
to SAB Zenzele Kabili is true and, where appropriate, does not omit anything that is likely to affect
the importance of the information contained herein solely pertaining to SAB Zenzele Kabili, and
that all reasonable enquiries to ascertain such information has been made.
Bryanston
17 February 2020
Investment bank and financial adviser to SAB Zenzele Kabili, AB InBev and SAB
Rand Merchant Bank (a division of FirstRand Bank Limited)
Legal adviser to SAB Zenzele Kabili, AB InBev and SAB
Bowmans
Independent Legal Advisers to SAB Zenzele and the Independent Board
ENSafrica
Independent Expert
BDO Corporate Finance Proprietary Limited
Reporting accountants
PricewaterhouseCoopers
Transaction Consultant
The Standard Bank of South Africa Limited
JSE Sponsor to AB InBev
Questco Corporate Advisory Proprietary Limited
AB InBev is a publicly traded company (Euronext: ABI) based in Leuven, Belgium, with secondary listings
on the Mexico (MEXBOL: ANB) and South Africa (JSE: ANH) stock exchanges and with American
Depositary Receipts on the New York Stock Exchange (NYSE: BUD).
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Date: 17-02-2020 08:00:00
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