Wrap Text
Joint Announcement of the Firm Intention of Volaris to Make an Offer to Acquire Control of Adapt IT
ADAPT IT HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number: 1998/017276/06)
Share code: ADI
ISIN: ZAE000113163
(“Adapt IT”)
VOLARIS GROUP INC
(Incorporated in Canada)
(Corporation number: 002277095)
(“Volaris”)
JOINT ANNOUNCEMENT OF THE FIRM INTENTION OF VOLARIS FOR IT OR ITS NOMINATED
WHOLLY-OWNED SUBSIDIARY ("Offeror") TO MAKE AN OFFER TO ACQUIRE CONTROL OF
ADAPT IT, BY WAY OF A SCHEME OF ARRANGEMENT OR GENERAL OFFER
1. INTRODUCTION
1.1. Shareholders of Adapt IT are hereby advised that Adapt IT and Volaris have entered into
a firm intention offer letter agreement (“FIO Agreement") pursuant to which inter alia
Volaris has delivered notice to Adapt IT of its firm intention for the Offeror to make an offer
(“Volaris Offer” or “Transaction”) to acquire control of Adapt IT through the acquisition of
up to 100% of the issued ordinary shares (excluding treasury shares) of Adapt IT (“Adapt
IT Shares”) from the holders of the Adapt IT Shares (“Adapt IT Shareholders”), by way of
the Scheme (as contemplated in paragraph 2.1.1) or, if the Scheme is not proposed or fails,
the General Offer (as contemplated in paragraph 2.1.2).
1.2. The Volaris Offer will be made at a cash consideration of ZAR 6.50 (six Rand and fifty
Cents) (“Cash Consideration”) per Adapt IT Share; however, as part of the Scheme, Adapt
IT Shareholders are entitled to elect to retain all or part of their Adapt IT Shares (as
contemplated in paragraph 2.2.2 below).
1.3. The Cash Consideration represents a premium of 56.9% to the 30-day volume weighted
average traded price of Adapt IT shares on the exchange operated by the JSE Limited
(“JSE”) of ZAR 4.14 (four Rand and fourteen Cents), as at 26 January 2021, being the last
trading date prior to the date on which the unsolicited general offer by Huge Group Limited
to Adapt IT Shareholders was announced on the Stock Exchange News Service of the JSE
(“SENS”) ("Huge Offer").
1.4. The Cash Consideration represents a premium of 56.3% to the closing price of Adapt IT
shares on the JSE of ZAR 4.16 (four Rand and sixteen Cents), as at 1 April 2021, being
the last trading date prior to the date of the FIO Agreement.
1.5. The independent board of Adapt IT, established by Adapt IT in relation to the Volaris Offer,
comprises Craig Michael Chambers, Oliver Darrel Fortuin, Catherine-Candice Koffman and
Innocentia Zizipho Nyanga (“Independent Board”).
1.6. Adapt IT Shareholders collectively holding 21.6% of the aggregate of the issued Adapt IT
Shares (excluding treasury shares), have furnished irrevocable undertakings in respect of
the Transaction (please refer to paragraph 12 below for relevant details in this regard).
2. THE VOLARIS OFFER AND CONSIDERATION
2.1. The Volaris Offer will be implemented by way of:
2.1.1. a scheme of arrangement (“Scheme”) in terms of section 114 of the Companies Act,
No. 71 of 2008 (“Companies Act”), to be proposed by the Adapt IT board of directors
(“Adapt IT Board”) between Adapt IT and Adapt IT Shareholders, at the Scheme
Consideration (as defined in paragraph 2.2 below) and upon the terms and subject to
the conditions set out in the circular to be distributed to Adapt IT Shareholders in due
course (“Circular”); and
2.1.2. if, inter alia, the Scheme is not proposed or fails, a general standby offer by the Offeror
to Adapt IT Shareholders (“General Offer”), as contemplated in section 117(1)(c)(v) of
the Companies Act at the Cash Consideration and upon the terms and subject to the
conditions set out in the Circular.
2.2. Under the terms of the Volaris Offer, if the Scheme is implemented, the Adapt IT
Shareholders will be afforded an election to (“Scheme Consideration”) –
2.2.1. sell all or part of their Adapt IT Shares to the Offeror, on the operative date of the
Scheme (“Scheme Implementation Date”), at the Cash Consideration (“Exit
Election”); or
2.2.2. retain all or part of their Adapt IT Shares (“Continuation Election”),
with the default position being that if Adapt IT Shareholders do not make valid elections,
they will be deemed to have made Exit Elections in respect of all their Adapt IT Shares.
The Cash Consideration set out in paragraph 1.2 above has been calculated on the
assumption that Adapt IT will not conduct any capital reduction, make any distributions,
dividends or similar payments to or for the benefit of Adapt IT Shareholders ("Distribution")
between 1 April 2021 and the settlement date of the Cash Consideration. In the event that
Adapt IT makes any such Distribution, the Cash Consideration will be adjusted downwards
by the amount of the Distribution on a per share basis.
2.3. The implementation of the Scheme will be subject to the fulfilment or waiver (as the case
may be) of the suspensive conditions set out in paragraph 6 below (“Scheme Conditions”).
In the event that the Scheme becomes operative, the listing of the Adapt IT Shares on the
Main Board of the JSE will be terminated following the approval of the Scheme Delisting
Resolution (as referred to in paragraph 6.1.5 below), unless the Scheme Delisting
Resolution is not approved by the requisite majority of Adapt IT Shareholders and the
Offeror waives the Scheme Condition relating to such approval being obtained.
2.4. In the event that the Scheme fails or is not proposed to the Adapt IT Shareholders, the
General Offer to Adapt IT Shareholders shall be implemented, which General Offer will be
subject to the suspensive conditions contemplated in paragraph 17.1 below. To the extent
that the General Offer is implemented, the listing of the Adapt IT Shares on the Main Board
of the JSE will be terminated following the approval of the General Offer Delisting
Resolution (as referred to in paragraph 17.3 below), unless the General Offer Delisting
Resolution is not approved by the requisite majority of Adapt IT Shareholders and the
Offeror waives the suspensive condition relating to such approval being obtained. Only
Adapt IT Shareholders who have accepted the General Offer will sell their Adapt IT Shares
to the Offeror for the Cash Consideration. Those Adapt IT Shareholders who do not accept
the General Offer will remain shareholders in Adapt IT, which may become an unlisted
subsidiary of the Offeror as aforesaid.
3. OVERVIEW OF VOLARIS AND CONSTELLATION SOFTWARE
3.1. Volaris specialises in acquiring vertical market software companies and is an operating
group of Toronto listed Constellation Software Inc. (“Constellation Software”) (TSX:CSU),
which has a market cap in excess of USD 25 billion. Its decentralised business model offers
vertical market software companies the ability to maintain their independence, which allows
them to focus on the needs of customers and employees post-acquisition. Volaris’ buy and
perpetual hold acquisition philosophy provides a safe and permanent home for software
businesses in a wide range of industries including Communications, Financial Services,
Education and many more.
3.2. Constellation Software, the parent company of Volaris, is an international provider of
market-leading software and services to a number of industries, both in the public and
private sectors. Its mission is to acquire, manage and build market-leading software
businesses that develop specialised, mission-critical software solutions.
3.3. Constellation Software was founded in 1995 to assemble a portfolio of vertical market
software companies that have the potential to be leaders in their particular market. Since
then, Constellation Software has grown through a combination of acquisitions and organic
growth and has established a group of companies with a customer base comprised of over
125,000 customers operating in over 100 countries around the World.
3.4. With its headquarters in Toronto, Canada, and offices in North America, Europe, Asia,
Australia, South America and Africa, Constellation Software has over 27,000 employees
generating consolidated revenues exceeding US$3.8 billion.
4. RATIONALE AND BENEFITS OF THE TRANSACTION
4.1. Successful conclusion of the Volaris Offer will result in a well-governed diversified South
African technology company with high growth ambitions being backed by a well-capitalised
leading global technology firm keen to support this growth. Volaris will be able to support
the existing Adapt IT management team with capital, global reach, and best practices to
aid the development of the Adapt IT business and further advance the value they deliver
to customers. In turn, Adapt IT will come to represent Volaris’ interests on the African
continent, a region in which it currently has limited presence but intends to grow in the
coming years. Volaris is confident that its long-term operating philosophy will create
sustainable growth for Adapt IT, its management, its employees, its customers, its partners,
and the broader community.
4.2. Accordingly, Volaris is of the opinion that the Volaris Offer is attractive for the following
reasons –
4.2.1. the Volaris Offer allows Adapt IT Shareholders to exit for a cash consideration or to
remain shareholders in a delisted Adapt IT;
4.2.2. the Cash Consideration is at a substantial premium;
4.2.3. Volaris will support the existing Adapt IT management team with capital, global reach,
and best practices to aid the development of the Adapt IT business and further advance
the value they deliver to customers;
4.2.4. Volaris is well capitalised and will enable sustainable growth for Adapt IT, its
management, its employees, its customers, its partners, and the broader community;
4.2.5. Volaris will use Adapt IT as its African champion for future transactions driven by the
Adapt IT management team;
4.2.6. post transaction, being part of a global group will enable Adapt IT to attract and retain
new and existing talent with international opportunities for growth, training and
development; and
4.2.7. the Volaris Offer will result in much needed direct foreign investment for South Africa,
additional growth capital being invested into South Africa and additional skills transfer,
all to the benefit of Volaris, Adapt IT, South Africa and stakeholders in general.
5. OVERVIEW AND EFFECTS OF THE SCHEME
5.1. The Scheme will constitute an "affected transaction" as defined in section 117(1)(c) of the
Companies Act. It will be implemented in accordance with the Companies Act and the
Companies Regulations, 2011 (“Companies Regulations”) and will be regulated by the
Takeover Regulation Panel (“TRP”).
5.2. The Circular will propose the Scheme only if on or before 30 April 2021, or such later date/s
as may be extended by the Offeror (subject to such regulatory approval as may be
required) –
5.2.1. the Independent Board has retained an independent expert (“Independent Expert”) in
terms of section 114(2) of the Companies Act and regulation 90 of the Companies
Regulations, and such expert has prepared and issued a report in terms of section
114(3) of the Companies Act on the Scheme Consideration and the fairness and
reasonableness thereof; and
5.2.2. the Independent Board confirms to the Offeror that it will recommend to the Adapt IT
Shareholders to vote in favour of (i) the Scheme and the Scheme Delisting Resolution
(as referred to in paragraph 6.1.5 below), and (ii) the General Offer Delisting Resolution
(as referred to in paragraph 17.3 below) and to accept the General Offer, as may be
applicable (for the avoidance of doubt no such confirmation has been provided as at the
date of this announcement).
5.3. The condition in paragraph 5.2.1 above is regulatory in nature and cannot be waived. The
Offeror may, in its discretion, waive the condition set out in paragraph 5.2.2 above.
5.4. In terms of the Scheme, the Offeror will acquire the relevant Adapt IT Shares from those
Adapt IT Shareholders who exercise the Exit Election, in exchange for the Cash
Consideration, whereupon Adapt IT will become a subsidiary of the Offeror. The listing of
Adapt IT's shares on the Main Board of the JSE will be terminated following the approval
of the Scheme Delisting Resolution (as referred to in paragraph 6.1.5 below).
5.5. Subject to the Scheme becoming unconditional:
5.5.1. Adapt IT Shareholders who have exercised the Exit Election (or are deemed to have
exercised the Exit Election) will be deemed to have disposed of all or part (as applicable)
of their Adapt IT Shares (including all rights, interests and benefits attaching thereto),
free of encumbrances, to the Offeror on the Scheme Implementation Date in exchange
for the Cash Consideration and the Offeror will be deemed to have acquired registered
and beneficial ownership, free of encumbrances, of all such Adapt IT Shares as of the
Scheme Implementation Date;
5.5.2. the disposal and transfer by any Adapt IT Shareholder of all or part of their Adapt IT
Shares (as applicable) held by such Adapt IT Shareholder to the Offeror and the
acquisition of ownership of such Adapt IT Shares by the Offeror pursuant to the
provisions of the Scheme, shall be effected on the Scheme Implementation Date;
5.5.3. each Adapt IT Shareholder who has exercised the Exit Election (or is deemed to have
exercised the Exit Election) will be deemed to have transferred to the Offeror, on the
Scheme Implementation Date, all or part of the Adapt IT Shares (as applicable) held by
such Adapt IT Shareholder, without any further act or instrument being required, and
such Adapt IT Shareholders will be entitled to receive the Cash Consideration; and
5.5.4. Adapt IT Shareholders who have exercised the Continuation Election in respect of all
or part of their Adapt IT Shares, shall retain the relevant Adapt IT Shares and will not
be entitled to receive any consideration in respect of such election.
5.6. The Scheme shall terminate and cease with immediate effect only as follows:
5.6.1. if any Scheme Condition, which may be waived unilaterally by the Offeror or by the
Offeror and Adapt IT by written agreement, as applicable, becomes incapable of
fulfilment and the Offeror (or the Offeror and Adapt IT, as applicable) does not waive
that Scheme Condition (if entitled to do so); or
5.6.2. if all the Scheme Conditions have not been fulfilled or waived on or by the date specified
for fulfilment thereof.
6. THE SCHEME CONDITIONS
6.1. The implementation of the Scheme is subject to the fulfilment or, if appropriate, waiver (in
whole or in part), of the following suspensive conditions by no later than 28 February 2022
in respect of the suspensive conditions set out in paragraphs 6.1.1 to 6.1.9 and 6.1.11 to
6.1.12, and by no later than 30 April 2021 in respect of the suspensive condition set out in
paragraph 6.1.10, or such later date/s as may be extended by the Offeror (subject to such
regulatory approval as may be required):
6.1.1. to the extent applicable, all requisite regulatory approvals required for the Scheme have
been obtained from the JSE, the TRP, the Financial Surveillance Department of the
South African Reserve Bank and the South African and other applicable foreign
competition authorities (either unconditionally or subject to conditions acceptable to the
Offeror);
6.1.2. the approval of the Scheme by the requisite majority of Adapt IT Shareholders as
contemplated in section 115(2)(a) of the Companies Act at the general meeting of Adapt
IT Shareholders to be convened for purposes of approving the Scheme (the "Adapt IT
General Meeting") ("Scheme Resolution"), and –
6.1.2.1. to the extent required, the approval of the implementation of the Scheme Resolution
by a court in terms of section 115(2)(c) and/or section 115(3) of the Companies Act;
6.1.2.2. if any person who voted against the Scheme Resolution, applies to court for a review
of the Scheme Resolution in terms of section 115(3)(b) of the Companies Act, either:
6.1.2.2.1. leave to apply to court for any such review is refused; or
6.1.2.2.2. if leave is so granted, the court refuses to set aside the Scheme Resolution;
6.1.2.3. if applicable, Adapt IT not treating the Scheme Resolution as a nullity, as
contemplated in section 115(5)(b) of the Companies Act;
6.1.3. the receipt of a compliance certificate or exemption issued by the TRP in terms of the
Companies Act in relation to the Scheme;
6.1.4. within the period prescribed by section 164(7) of the Companies Act, no valid demands
having been received by Adapt IT in terms of that section read with section 115(8) of
the Companies Act which in aggregate represent more than 2.5% of the issued Adapt
IT Shares (excluding treasury shares) as at the date of the Adapt IT General Meeting;
6.1.5. approval by the requisite majority of Adapt IT Shareholders at the Adapt IT General
Meeting of the termination of Adapt IT's listing on the Main Board of the JSE in terms of
section 1.15(a) of the Listings Requirements of the JSE (the "Scheme Delisting
Resolution");
6.1.6. Adapt IT Shareholders holding at least 50% plus one of the Adapt IT Shares making the
Exit Election (or are deemed to have made the Exit Election) as part of the
implementation of the Scheme;
6.1.7. the executive directors of Adapt IT as at 4 April 2021 make the Continuation Election in
respect of at least 90% of the Adapt IT Shares they hold directly or indirectly;
6.1.8. to the extent required, the counterparties to the material supplier and distributor / partner
contracts of the Adapt IT group ("Material Contracts"), consenting in writing to the
change of control of Adapt IT as a result of the implementation of the Scheme, in a
manner and form reasonably acceptable to the Offeror (for purposes of this paragraph
6.1.8, a supplier contract shall be deemed to be "material" in the event that it represents
at least 10% of Adapt IT's annual cost of sales, and a partner / distributor contract shall
be deemed to be "material" in the event that it represents at least 10% of Adapt IT's
annual gross revenue)
6.1.9. The Standard Bank of South Africa Limited has provided such consent or approval, in
writing, as may be required under the written facility agreements entered into between
it and the Adapt IT group ("Facility Agreements"), in order for the Scheme to be able
to be implemented without triggering any event of default or other potential adverse
consequence under the Facility Agreements;
6.1.10. each of the executive directors of Adapt IT has entered into and signed a service
contract with the Adapt IT group on such terms and conditions and in such form and
substance as is acceptable to the Offeror acting reasonably (as confirmed by the Offeror
by written notice to Adapt IT), effective from the Scheme Implementation Date;
6.1.11. Adapt IT's value appreciation rights plan ("VARP") has been consequentially amended
to allow for its continued operation to Adapt IT employees should Adapt IT be delisted
from the Main Board of the JSE, as contemplated by the Scheme Delisting Resolution,
on terms and conditions and in such form and substance as is acceptable to the Offeror
acting reasonably (as confirmed by the Offeror by written notice to Adapt IT) and the
participants of the VARP have waived their right to a comparable offer in terms of the
Companies Regulations pursuant to the Scheme; and
6.1.12. no material adverse event ("MAE"), as contemplated in paragraph 6.2 below, has
occurred.
6.2. A "MAE" will have occurred if either –
6.2.1. the gross revenue or EBITDA (as defined below) of Adapt IT as indicated in the
consolidated audited annual financial statements for the period ending June 2021 is
less than the gross revenue or EBITDA for the preceding financial year (ended June
2020) by 10% or more; or
6.2.2. the Scheme is implemented after the December 2021 interim results of Adapt IT are
published and the gross revenue or EBITDA of Adapt IT as indicated in such interim
results is less than the gross revenue or EBITDA indicated in the preceding financial
year's interim results (December 2020) by 10% or more.
For the purposes of this paragraph 6.2, EBITDA means Earnings Before Interest, Tax,
Depreciation and Amortisation as reflected in the financial statements of Adapt IT in
accordance with IFRS, but adjusted so as not to take into account:
(i) costs of corporate actions and transactions;
(ii) any impairment of Right of Use Assets under IFRS 16;
(iii) any increase in the Financial Liability in respect of the Wisenet earnout under IFRS 3;
(iv) any impairment to the carrying value of goodwill or intangibles of the Aquilon (Energy)
Cash Generating Unit; and
(v) other adjustments (including Fair Value adjustments pertaining to IFRS 3) which are, in
accordance with the SAICA circular titled "Headline Earnings", excluded for the
purposes of calculating Headline Earnings.
6.3. Volaris and Adapt IT shall use their reasonable endeavours to procure the fulfilment of the
Scheme Conditions as soon as reasonably practicable.
6.4. The Scheme Conditions in –
6.4.1. paragraphs 6.1.1 to 6.1.3 above are regulatory in nature and cannot be waived;
6.4.2. paragraphs 6.1.8 and 6.1.9 above have been inserted for the benefit of Adapt IT and
the Offeror, and shall be capable of waiver, in whole or in part, by mutual written
agreement between Adapt IT and the Offeror; and
6.4.3. paragraphs 6.1.4 to 6.1.7 and 6.1.10 to 6.1.12 above have been inserted for the benefit
of the Offeror, which will be entitled, in its sole discretion, to waive fulfilment of such
Scheme Conditions, in whole or in part, on written notice to Adapt IT.
6.5. Unless all the Scheme Conditions have been fulfilled or, where possible, waived by not
later than the relevant dates for fulfilment thereof set out in paragraph 6.1 (or such later
date or dates to which the fulfilment date/s may have been extended in terms of paragraph
6.1) (each a "Fulfilment Date"), the Scheme shall terminate automatically on the Fulfilment
Date of the first Scheme Condition that was not timeously fulfilled or, where possible,
waived.
7. FUNDING AND CASH CONFIRMATION
7.1. The Cash Consideration will be funded by Volaris from a combination of debt and cash.
7.2. In accordance with Regulation 111(4) and Regulation 111(5) of the Companies Regulations,
the Offeror has provided an irrevocable bank guarantee to the TRP which confirms that, in
aggregate, the Offeror has sufficient cash resources in terms of Regulation 111 to satisfy
payment of the maximum Cash Consideration (“Maximum Cash Consideration”). The
Maximum Cash Consideration has been calculated on the basis that there are 137,261,839
Adapt IT ordinary shares in issue (excluding treasury shares).
8. MATERIAL PROVISIONS OF THE FIO AGREEMENT
8.1. Non-solicitation by Adapt IT
In terms of the FIO Agreement, Adapt IT has provided certain non-solicitation undertakings to
Volaris that are appropriate for a transaction of the nature of the Transaction.
8.2. Other interim period undertakings
In terms of the FIO Agreement, Adapt IT has provided certain interim period undertakings to
Volaris that are appropriate for a transaction of the nature of the Transaction.
8.3. Transaction assistance
In terms of the FIO Agreement:
8.3.1. each of Adapt IT and Volaris has provided undertakings to the other to do all such things
as may be reasonably required to assist in preparing and executing the Transaction
documentation; and
8.3.2. Adapt IT has provided inter alia an undertaking to propose the Scheme to the Adapt IT
Shareholders.
9. BREAK FEE
9.1. Adapt IT undertakes to pay to Volaris a break fee equal to 1% of the Maximum Cash
Consideration plus value-added tax (“Break Fee”), if –
9.1.1. Adapt IT breaches any of the non-solicitation undertakings referred to in paragraph
8.1; or
9.1.2. a transaction resulting from an alternative offer (other than the Huge Offer) is
consummated prior to the Scheme Implementation Date or the implementation date of
the General Offer (as applicable).
9.2. Adapt IT shall pay the Break Fee to Volaris within 10 business days of any of the events
described in paragraph 9.1.
10. DELISTING OF ADAPT IT SHARES
10.1. Should the Scheme be implemented, the listing of the Adapt IT Shares on the Main Board
of the JSE will be terminated following the approval of the Scheme Delisting Resolution,
unless the Scheme Delisting Resolution is not approved by the requisite majority of Adapt
IT Shareholders and the Offeror waives the Scheme Condition relating to such approval
being obtained.
10.2. In the event that the Scheme fails or is not proposed to the Adapt IT Shareholders, and the
General Offer to Adapt IT Shareholders is implemented, the listing of the Adapt IT Shares
on the Main Board of the JSE will be terminated following the approval of the General Offer
Delisting Resolution (as referred to in paragraph 17.3 below), unless the General Offer
Delisting Resolution is not approved by the requisite majority of Adapt IT Shareholders and
the Offeror waives the suspensive condition relating to such approval being obtained.
11. INTERESTS OF OFFEROR AND OFFEROR DIRECTORS IN ADAPT IT SHARES
11.1. The Offeror does not hold any Adapt IT Shares.
11.2. The Offeror has not had any dealings in Adapt IT Shares during the six-month period prior to
the date of signature of the FIO Agreement.
11.3. None of the Offeror’s directors have a beneficial interest in Adapt IT Shares.
11.4. None of the Offeror’s directors have had any dealings in Adapt IT Shares during the six-month
period prior to the date of signature of the FIO Agreement.
12. IRREVOCABLE UNDERTAKINGS
Irrevocable undertakings have been given to vote in favour of the Scheme and the Scheme
Delisting Resolution and General Offer Delisting Resolution (as referred to in paragraph 17.3
below), by the following Adapt IT Shareholders, who collectively hold 21.6% of the Adapt IT
Shares (excluding treasury shares):
Shareholder Number of Adapt IT Adapt IT Shares held
Shares held as a % of all the Adapt
IT Shares in issue
(excluding treasury
shares)
Sibusiso Shabalala 14,316,646 10.4%
Nedgroup Investment Advisors 7,000,000 5.1%
Tiffany Dunsdon & the Dunsdon Self
Managed Super Fund 4,500,000 3.3%
Rubistar (Pty) Limited 3,800,000 2.8%
Total 29,616,646 21.6%
13. REPORT OF THE INDEPENDENT EXPERT
13.1. The Independent Board has appointed Nodus Capital Proprietary Limited as the Independent
Expert, as required in terms of section 114(2) of the Companies Act and the Companies
Regulations, to issue an opinion dealing with the matters set out in sections 114(2) and 114(3)
of the Companies Act and regulations 90, 110(1) and 113(1)(a) of the Companies Regulations,
to express an opinion on whether the Scheme Consideration is fair and reasonable to Adapt
IT Shareholders.
13.2. The report of the Independent Expert to be prepared in accordance with section 114(3) of the
Companies Act and regulations 90 and 110 of the Companies Regulations will be provided in
the Circular.
14. OFFEROR ACTING AS PRINCIPAL
The Offeror (i.e. Volaris or a wholly-owned subsidiary of Volaris nominated by Volaris as set out
below) will be the ultimate prospective purchaser of the relevant Adapt IT Shares and is acting
alone and not in concert with any other person.
Volaris shall be entitled to nominate a wholly-owned subsidiary of Volaris as offeror by giving
written notice to Adapt IT to that effect by not later than 20 business days after the date of the
FIO Agreement.
15. INDEPENDENT BOARD RESPONSIBILITY STATEMENT
The Independent Board accepts responsibility for the information contained in this
announcement which relates to Adapt IT and confirms that, to the best of its knowledge and
belief, such information which relates to Adapt IT is true and this announcement does not omit
anything likely to affect the importance of such information.
16. VOLARIS BOARD RESPONSIBILITY STATEMENT
The board of directors of the Offeror accepts responsibility for the information contained in this
announcement which relates to the Offeror and confirms that, to the best of its knowledge and
belief, such information which relates to the Offeror is true and this announcement does not omit
anything likely to affect the importance of such information.
17. GENERAL OFFER
17.1. If the Scheme is not proposed by 30 June 2021 or after the Scheme is proposed it fails for any
reason ("General Offer Trigger Event"), then the Scheme will not become effective and an
offer to holders of Adapt IT Shares to acquire all or part of their Adapt IT Shares by way of a
general offer in terms of the Companies Act for the Cash Consideration will commence on the
terms and conditions precedent consistent, mutatis mutandis, with those of the Scheme and,
to the extent applicable, the FIO Agreement, and will be subject to an additional condition
precedent that Adapt IT Shareholders tender that number of Adapt IT Shares which, when
accepted by the Offeror, would result in the Offeror holding 50% plus one of the Adapt IT
Shares, which additional condition precedent the Offeror shall be entitled to waive.
17.2. The General Offer will be a continuation of the affected transaction as defined in section 117
of the Companies Act. The General Offer will be implemented in accordance with the
Companies Act and the Companies Regulations and will be regulated by the TRP.
17.3. To the extent that the General Offer is implemented, only Adapt IT Shareholders who have
accepted the General Offer will sell their Adapt IT Shares to the Offeror for the Cash
Consideration. Those Adapt IT Shareholders who do not accept the General Offer will remain
shareholders in Adapt IT, which will, following the required approval by the requisite majority
of Adapt IT Shareholders at the Adapt IT General Meeting of the termination of Adapt IT's
listing on the Main Board of the JSE in terms of section 1.15(a) of the Listings Requirements
of the JSE, become an unlisted subsidiary of the Offeror.
17.4. If a General Offer Trigger Event occurs, the salient dates and times relating to the General
Offer will be published on SENS and in the press.
18. POSTING OF THE CIRCULAR
18.1. Further details of the Transaction will be included in the Circular, which will contain inter alia
the Independent Expert's opinion and the recommendation of the Independent Board, the
terms of the Scheme and General Offer, pertinent dates relating to the Scheme and General
Offer, a notice of the Adapt IT General Meeting, a form of proxy and a form of election,
surrender and transfer in respect of the Scheme.
18.2. The salient dates in relation to the Transaction will be published on SENS and in the press at
the time of posting of the Circular. Shareholders are advised to refer to the Circular for the full
terms of and conditions, including related salient dates and times, of the Scheme and the
General Offer.
Johannesburg
7 April 2021
Financial Advisor to Adapt IT Legal Advisor to Adapt IT Sponsor to Adapt IT
The Standard Bank of South Webber Wentzel Merchantec Capital
Africa Limited
Transaction Advisor to Volaris Legal Advisor to Volaris Independent Expert to Adapt IT
PSG Capital Cliffe Dekker Hofmeyr Nodus Capital Proprietary Limited
Date: 07-04-2021 05:35:00
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