Finalisation announcement relating to an Odd-lot Offer and Specific Offer in respect of Trencor Shares
(Incorporated in the Republic of South Africa)
(Registration No 1955/002869/06)
Share Code: TRE
(“Trencor” or the “Company”)
FINALISATION ANNOUNCEMENT RELATING TO AN ODD-LOT OFFER AND SPECIFIC OFFER IN RESPECT OF TRENCOR SHARES
Capitalised terms (i.e. denoted by words with a capitalised first letter) used in this announcement and not expressly defined herein shall bear the same meaning as ascribed to them in the Circular.
Shareholders are referred to the Circular posted on Wednesday, 18 September 2019, which contained details regarding the odd-lot offer (“Odd-lot Offer”) and specific offer (“Specific Offer”) to Trencor shareholders (“Shareholders”) (collectively “the Offers”). Shareholders are further referred to the general meeting of Shareholders that was held on Friday, 18 October 2019 (“General Meeting”), and the subsequent announcements that were released on Stock Exchange News Service (“SENS”) on Friday, 18 October 2019, advising the voting results of the General Meeting, and on Tuesday, 22 October 2019, advising that the Offers were approved by Shareholders at the General Meeting.
The Offers comprise:
– The Odd-lot Offer to repurchase Trencor ordinary shares (“Shares”) from Shareholders holding fewer than 100 Shares (“Odd-lot Holding”) on the Offers record date (“Odd-lot Holders”); and
– The Specific Offer to repurchase Shares from Shareholders holding 100 Shares or more but equal to or fewer than 635 Shares (“Specific Holding”) on the Offers record date (“Specific Holders”).
2. SALIENT DETAILS OF THE OFFERS
2.1. ODD-LOT OFFER
In terms of the Odd-lot Offer, Odd-lot Holders are offered the opportunity to elect to either:
– sell their entire Odd-lot Holding for a consideration equal to the Offer Price (as defined in paragraph 2.3 below) multiplied by the number of Shares held on the record date of the Offers (“Offer Consideration”); or
– retain their entire Odd-lot Holding.
Shareholders are advised that Odd-lot Holders who do not make an election, within the stipulated time period, will automatically be regarded as having elected to sell their entire Odd-lot Holding for the Offer Consideration.
2.2. SPECIFIC OFFER
In the case of Specific Holders, Trencor is extending a Specific Offer to acquire their entire Specific Holding in Trencor for the Offer Consideration.
Shareholders are advised that Specific Holders who do not make an election will retain their entire Specific Holding in Trencor.
2.3. OFFER PRICE
The offer price per Share in respect of the Offers is R32,28 (“Offer Price”) and has been calculated based on the volume weighted average traded price (“VWAP”) of a Share on the JSE for the 10 trading days up to the close of business on Monday, 28 October 2019, plus a 10% premium.
2.4. DIVIDENDS TAX
The Offer Consideration will constitute a “dividend” as such term is used for purposes of the Dividends Tax provisions contained in the Income Tax Act. The Offers will give rise to a liability for Dividends Tax at the full rate of 20% in accordance with the Income Tax Act in the event that any Odd-lot Holder or Specific Holder does not qualify for an exemption from the Dividends Tax, and to the extent that the Odd-lot Holder or Specific Holder does not qualify for a reduced rate of Dividends Tax in terms of an applicable DTA entered into by South Africa.
The Offer Consideration will be exempt from Dividends Tax, or subject to a reduced rate of Dividends Tax as a result of the application of a DTA entered into by South Africa, in the event that the beneficial owner of an Odd-lot Holding or Specific Holding has, by date of distribution of the Offer Consideration, submitted to its Regulated Intermediary both the required declaration and written undertaking, in such form as may be prescribed by the Commissioner for SARS.
In the event that any Odd-lot Holder or Specific Holder does not qualify for an exemption from Dividends Tax or reduction in the rate of Dividends Tax, or does not timeously submit to their Regulated Intermediary the required declaration and written undertaking, the Regulated Intermediary will withhold from the Offer Consideration Dividends Tax at the full rate of 20% of the Offer Consideration in order to enable it to make payment of such Dividends Tax.
Should a Shareholder not qualify for an exemption from Dividends Tax or reduction in the rate of Dividends Tax, the Offer Price gross and net of the Dividends Tax will be:
– Gross Offer Price: R32,28
– Net Offer Price: R25,824 (being R32,28 less 20% Dividends Tax).
2.5. SECURITIES TRANSFER TAX (“STT”)
In terms of the STT Act, STT will be payable on the transfer of the Shares repurchased by Trencor from Odd-lot Holders or Specific Holders pursuant to the respective Offers (“Repurchase Shares”). The amount of STT to be imposed will be calculated as 0,25% of the consideration for the Repurchase Shares declared by Trencor as the person who acquires the Repurchase Shares.
The CSDP of the relevant Shareholder will be liable for payment to SARS of the STT payable in respect of the transfer of the Repurchase Shares acquired pursuant to the Share Repurchase. However, in terms of the STT Act the CSDP of the relevant Shareholder is entitled to recover the amount of STT payable to SARS from Trencor, being the person to whom Repurchase Shares are transferred pursuant to the Share Repurchase.
Accordingly, Trencor will be liable to the CSDPs, and will pay, the STT payable on the transfer of the Repurchase Shares from Odd-lot Holders or Specific Holders to Trencor.
3. SALIENT DATES AND TIMES
The Odd-lot Offer and Specific Offer are unconditional and the salient dates and times in respect of the implementation of the Offers are set out below:
|Last day to trade Shares in order to be recorded in the Register to participate in the Offers||Tuesday, 5 November 2019|
|Shares trade “ex” the Offers||Wednesday, 6 November 2019|
|Forms of election and surrender for the Offers (blue and pink) to be received by Computershare by 12:00||Friday, 8 November 2019|
|Offers close at 12:00||Friday, 8 November 2019|
|Offers record date, being the date on which an Odd-lot Holder or a Specific Holder, as the case may be, must be registered in the Register in order to be eligible to participate in the Offers, by close of trade||Friday, 8 November 2019|
|Offers implementation date||Monday, 11 November 2019|
|Dematerialised Odd-lot Holders and Dematerialised Specific Holders who have accepted the Offers or Odd-lot Holders who are deemed to have accepted the Odd-lot Offer will have their accounts held at their CSDP or Broker credited with the Cash Consideration||Monday, 11 November 2019|
|Payments of the Cash Consideration to Certificated Odd-lot Holders and Certificated Specific Holders who have accepted the Offers or Odd-lot Holders who are deemed to have accepted the Odd-lot Offer||Monday, 11 November 2019|
|Results of the Offers released on SENS||Monday, 11 November 2019|
|Cancellation and termination of listing of Shares repurchased in terms of the Offers expected on or about||
Thursday, 14 November 2019
- All dates and times indicated above are South African Standard Time.
- Odd-lot Holders who do not make an election will automatically be regarded as having elected and accepted the Odd-lot Offer.
- Dematerialised Odd-lot Holders and Specific Holders are requested to notify their duly appointed CSDP or Broker of their election by the cut-off time stipulated by their CSDP or Broker. This will be an earlier date than the date on which the relevant Forms of Election and Surrender for the Offers (blue and pink) must be received by Computershare and the date of the closing of the Offers (i.e. both being 8 November 2019).
- In the case of Certificated Odd-lot Holders and Certificated Specific Holders who accept, or are regarded as having accepted the Odd-lot Offer or have accepted the Specific Offer, payment will be made by electronic funds transfer into the bank accounts of the Odd-lot Holders and Specific Holders on Monday, 11 November 2019, if such holders’ banking details have been provided in the relevant Forms of Election and Surrender for the Offers (blue or pink). No cheques or other forms of tender will be utilised or posted.
- Shareholders who acquire an Odd-lot Holding or a Specific Holding after the last day to trade to participate in the Offers will not be eligible to participate in the Offers.
- Share certificates for an Odd-lot Holding or a Specific Holding may not be dematerialised or rematerialised after the last day to trade and the record date to participate in the Offers (the record date being included).
Trencor Services Proprietary Limited
29 October 2019
Financial Advisor and Transaction Sponsor
Investec Bank Limited
Legal and Tax Advisor
Edward Nathan Sonnenbergs Inc.