ECS terms Announcement involving Investments and mortgage Settlements ECSPONENT constrained integrated within the Republic of South Africa Registration number: 199801321506 JSE Code: ECS – ISIN: ZAE000179594 “Ecsponent” or,the company” phrases ANNOUNCEMENT involving INVESTMENTS AND mortgage SETTLEMENTS 1.
Introduction and rationale Ecsponent”s board of administrators “the Board” is happy to announce that the business and its subsidiaries “the neighborhood” have agreed phrases for a number of transactions based on the group”s strategic focal point, which comprises poker online investing in property that deliver the group with medium to lengthy-term capital increase.
These transactions will: – position the community for future value-bettering investments; – create an effective and expert administration constitution for the community”s fairness investments; – increase the group”s fairness protecting in property regarded to have excessive growth talents; and – give a more tax efficient structure for the community”s equity investments.
These transactions consist of: – a proposed investment into Capitis Equities Proprietary restrained “Capitis”, a black ladies- owned as described by means of the Black financial Empowerment Act 2003 project capital business, with professional talents focused on the acquisition and administration of fairness investments.
Capitis is registered under part 12J of the revenue Tax Act No. fifty eight of 1962 “revenue Tax Act”.
The company, andor certainly one of its completely owned subsidiaries, intends to make investments up to R400 million in Capitis prior to the expiry of the fiscal yr ending 30 June 2019 “the Capitis funding”; – the acquisition by Ecsponent constrained included in Botswana “ECS Botswana”, a unconditionally owned subsidiary of the business, of 352 612 shares in MyBucks S.A.
“MyBucks”, constituting 2.729% of the total issued share capital of MyBucks, in settlement of a loan owing through DTM Capital Proprietary confined “DTM” to ECS Botswana of BWP65 million R81.9 million on the trade rate at the date of this announcement “the DTM mortgage” “the DTM Acquisition”; and – the acquisition by way of Ecsponent Treasury services Proprietary restrained “Ecsponent Treasury features”, a totally owned subsidiary of the company, of 1 145 998 shares in MyBucks, constituting eight.839% of the overall issued share capital of MyBucks, in contract of the loan owing with the aid of Coronado buying and selling 258 CC “Coronado” to Ecsponent Treasury services of R260 million “the Coronado mortgage” “the Coronado Acquisition”; jointly,the Transactions”.
The Transactions 2.1.
The Capitis investment 2.1.1.
Overview and reason Capitis offers Ecsponent with a very good and expert funding vehicle to expand the opportunities accessible to Ecsponent.
Capitis provides Ecsponent with an funding associate that has the infrastructure and management to perform the sourcing, due diligence and ongoing funding administration for enormous transactions, thereby reducing the investment risk for Ecsponent.
The Capitis funding helps the neighborhood”s current company actions, which are geared toward spurring native economic building through the guide, abilities transfer and funding of South African small and medium agencies SMEs.
The Board has permitted an investment in Capitis of as much as R400 million in advance of the end of the economic 12 months ending 30 June 2019, R156.5 million of which has been accredited for instant funding.
The community intends to invest the ultimate stability once the requisite shareholder approvals have been obtained based on paragraph 2.1.6 under.
in terms of the contract with Capitis, Ecsponent intends to subscribe for definite classes of fairness shares, amounting to 19% of the enterprise”s share capital, thereby proposing funding to Capitis for onward funding into Qualifying Investee agencies, as defined in the revenue Tax Act, as and when Qualifying investment businesses are identified and introduced to Ecsponent for funding.
Investments with the aid of the group into Capitis will permit Ecsponent or any of its subsidiaries a bit 12J tax deduction when it comes to the revenue Tax Act equal to the value of the volume invested, given that the provisions of part 12J are complied with.
details of the Capitis and Ecsponent”s funding parameters Capitis is a newly established assignment capital enterprise, the administrators of whom are MJ Bokwa, MCS Nell, DP Van der Merwe and JW Miller.
Capitis may additionally not, in terms of area 12J, make investments more than 20% of its dollars into a single Qualifying investment business, measured after three years from the commencement of its operations.
A Qualifying funding enterprise is an organization it is: – a resident; – no longer a managed neighborhood company with regards to a group of agencies; – a taxpayer in decent standing; – an unlisted enterprise or a junior mining business unlisted or listed on the Alternate change of the JSE; – not carrying on any impermissible exchange; and – generating profits the place the sum of any investment profits doesn’t exceed 20 % of the scandalous profits.
Qualifying funding organizations may now not keep on impermissible trades, at the moment being: – any alternate carried on in appreciate of immovable property, aside from a trade carried on as a resort keeper; – any trade carried on through a financial institution, an extended-time period insurer, a brief-time period insurer and any trade carried on in respect of money-lending or rent-buy financing; – any change carried on in appreciate of fiscal or advisory capabilities, together with change in respect of legal services, tax advisory capabilities, stock broking functions, management consulting functions, auditing or accounting features; – any trade carried on in appreciate of playing; – any exchange carried on in respect of liquor, tobacco, hands or ammunition; and – any alternate carried on chiefly backyard the Republic of South Africa.
fiscal counsel Capitis turned into included on 7 June 2017 and suggested net belongings of R12 million as at 28 February 2018, being its monetary yr end.
The company reported a loss of R56 271 after tax for the 9-month length ended 28 February 2018.
The above financial counsel is according to the unaudited monetary tips of Capitis for the nine months ended 28 February 2018, reported based on international monetary Reporting requirements “IFRS”.
As Qualifying investment agencies have not yet been recognized, economic advice in relation to any Qualifying investment agencies can’t be disclosed.
situations precedent advert useful date of the Capitis funding there is presently no beneficial date for the Capitis funding, as subscription agreements with Capitis will best be concluded as and when Qualifying investment corporations are recognized, offered to Ecsponent and satisfy Ecsponent”s investment standards.
moreover general circumstances precedent contained in a subscription settlement, such settlement will especially include right here conditions precedent: – approval of the Board of Ecsponent following the crucial due diligence on a Qualifying investment enterprise recognized and presented by way of Capitis; and – approval of shareholders according to the Listings requirements, as set out in paragraph 2.1.6 beneath, for any cash invested in excess of R156.5 million; 2.1.5.
phrases of the Capitis funding earlier than the subscription for fairness shares in Capitis, Ecsponent or any of its subsidiaries will enter into a subscription contract with Capitis containing phrases, conditions and warranties that are common for a transaction of that nature.
Categorisation and approval requirements in accordance with the proposed funding of R400 million, the Capitis funding will represent a category 1 transaction in terms of the JSE Listings necessities “Listings requirements” and thus requires the approval of shareholders of the business in terms of a normal resolution, requiring the approval of 50% + 1 vote of shareholders current in grownup or by proxy.
Capitis isn’t a related birthday party to Ecsponent as described within the JSE Listings requirements.
The DTM Acquisition 2.2.1.
Overview and purpose when it comes to the agreements giving effect to the DTM Acquisition, ECS Botswana will acquire 352 612 shares in MyBucks from Sunblaze investment Holdings incorporated “Sunblaze”, the guarantor of the DTM mortgage, in contract of the DTM personal loan.
apart from enhancing the pleasant of the neighborhood”s property and increase salary prospects, the acquisition of additional shares in MyBucks gives the community with an multiplied capacity to have an impact on the choices of MyBucks.
The ability to accomplice with MyBucks will allow Ecsponent to on lend funding that the neighborhood aims to raise via its option share application and from different third events.
furthermore, the elevated shareholding in MyBucks offers the neighborhood with entry to fiscal services and connected know-how which aren’t currently otherwise available to the group.
Consideration The purchase consideration payable via ECS Botswana for the DTM Acquisition of BWP65 million R81.9 million at the trade fee on the date of this announcement, can be settled through the settlement of the DTM mortgage, having a personal loan stability of BWP65 million.
circumstances Precedent and positive date The contract on the subject of the DTM Acquisition is field to the fulfilment, or waiver if relevant, of right here suspensive conditions on or earlier than 31 July 2018, or such later date as agreed in writing between the events: – approval via the shareholders of the business in typical assembly; – approval by the Board of the business; – approval by the board of directors of Ecsponent Botswana; – approval by way of the board of directors of Sunblaze; – approval by using the board of administrators of DTM; and – approval by way of the JSE restricted “JSE”, to the extent fundamental.
The positive date of the DTM Acquisition may be the close of enterprise on the last business day of the month wherein the closing of the conditions precedent thereto has been fulfilled, or waived, as the case could be.
different tremendous phrases extra phrases, situations and warranties which are general for a transaction of this nature are contained within the DTM Acquisition contract.
Overview of MyBucks MyBucks is a monetary expertise company listed on the Frankfurt stock trade beneath share code MBC:GR and ISIN LU1404975507, with a market capitalisation of.”168,55 million equal to R2 688.37 million as on the date of this announcement.
MyBucks is basically engaged within the customer lending sector and currently owns licensed banking operations in four nations.
The enterprise presents more than a few items as enumerated under.
MyBucks currently has operations in eleven African countries, Poland and Australia.
financial items offered by means of MyBucks encompass: banking, lending short-and future, insurance, credit score reports and budgeting equipment.
MyBucks operates beneath three different manufacturers: – GetBucks, represented in 11 countries and along with lending to small and medium- sized agencies and entrepreneurs, including home growth loans, personal credit score loans, academic loans, agricultural loans, company loans, credit reports and budgeting equipment; – GetSure, represented in 6 international locations, which include insurance items, including agricultural catastrophe insurance, supplier insurance, salary protection and education company cover; and – GetBanked, represented in 6 nations, which includes virtual banking items, similar to rate reductions debts, cell transactions, transactional playing cards and remittances. 2.2.6.
economic counsel of MyBucks MyBucks mentioned a total web loss after tax of,2 741 353 for the meantime fiscal period ended 31 December 2017, of which a loss of,2 142 940 concerning continuing operations.
MyBucks pronounced internet property, apart from minority pastime, of.”7 461 398 as at 31 December 2017.
The above fiscal advice is according to the condensed unaudited period in-between fiscal information of MyBucks for the six months ended 31 December 2017, organized based on IFRS as adopted via the ecu Union.
Categorisation and approvals required when it comes to the Listings necessities, the DTM Acquisition is on a stand-on my own basis a category 2 transaction and consequently the DTM Acquisition does not require any further shareholder approval.
DTM and Sunblaze are not linked parties of the business as described within the JSE Listings necessities.
The Coronado Acquisition 2.3.1.
Overview and motive when it comes to the settlement giving impact to the Coronado Acquisition, Ecsponent Treasury services will purchase 1 a hundred forty five 998 shares in MyBucks from DTM, the guarantor of the Coronado personal loan, in contract of the Coronado personal loan.
The Coronado Acquisition gives Ecsponent with the possibility to boost the best of the neighborhood”s property, besides the merits of increasing its shareholding in MyBucks as already noted in paragraph 2.2.1 above.
buy consideration The purchase consideration payable via Ecsponent Treasury features for the Coronado Acquisition of R260 million might be settled in the course of the settlement of the Coronado loan, having a mortgage balance of R260 million.
conditions Precedent and beneficial date The agreement in terms of the Coronado Acquisition is field to the fulfilment, or waiver if relevant, of the following situations precedent on or earlier than 30 September 2018, or such later date to be agreed between the events: – approval with the aid of the participants of Coronado; – approval via the board of directors of DTM; – approval with the aid of the board of directors of Ecsponent Treasury features; – approval by way of the shareholders of the enterprise; – approval with the aid of the Board of the enterprise; and – approval via the JSE, to the extent fundamental.
The advantageous date of the Coronado Acquisition will be the shut of company on the final business day of the month during which the remaining of the situations precedent thereto has been fulfilled, or waived, as the case may be.
different tremendous terms extra terms, situations and warranties which are normal for a transaction of this nature are contained in the Coronado Acquisition contract.
Overview of MyBucks refer to paragraph 2.2.5 of this announcement for an overview of MyBucks. 2.3.6.
financial tips of MyBucks confer with paragraph 2.2.6 above for an outline of the newest monetary tips of MyBucks. 2.3.7.
Categorisation and approvals required when it comes to the Listings necessities, the Coronado Acquisition is a category 1 transaction, each on a stand-alone groundwork and when aggregated with the DTM Acquisition as it contains the acquisition of the identical asset and some of the identical parties.
for this reason, the Coronado Acquisition requires the approval of shareholders in terms of an ordinary decision at a regular assembly, requiring the approval of fifty% + 1 vote of shareholders existing in adult or via proxy.
Coronado and DTM aren’t related parties of the company, as described in the JSE Listings necessities. three.
circular to shareholders A round atmosphere out the entire particulars of the Coronado Acquisition and the Capitis Investments, and incorporating a word of a familiar meeting should be disbursed to shareholders of the business in due direction.
Pretoria 22 may additionally 2018 Sponsor and corporate guide Questco corporate Advisory Pty Ltd Date: 23052018 09:04:00 Produced by the JSE SENS branch.
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