CIL announced the acquisition of a 30.5% interest in Angola Environmental Serviços Limitada (“AES”), an Angolan based company providing waste management services to the oil and gas sector. Over the past year, the group has worked on defining a Pan-African growth strategy involving acquisitions leveraging the expertise gained from the successful acquisition and management of its power subsidiary, Consolidated Power Projects (Pty) Ltd. in 2008. Group management believes AES is an exceptional first step as part of its growth strategy, offering high growth potential in the oil and gas sector in Angola and on the African continent. Through its operations, AES introduces CIL to another thriving business that can harvest the opportunities that the African continent presents. The group is confident that the acquisition will be earnings enhancing over time as AES continues to thrive in a buoyant market. Although it is anticipated that the required Angolan regulatory approvals may take in excess of a year to be fulfilled, CIL will be actively involved in the management of the business from signature date. Acquisition Shareholders were informed that on 25 November 2012 an agreement (the “Acquisition Agreement”) was entered into between, inter alia, CIL’s wholly owned Mauritian subsidiary company, Consolidated Infrastructure Group-Angola 1 (“CIGA”) and N’zogi Yetu-Gestao de Empreedimentos Limitada (the “Seller”), in terms of which, inter alia, the Seller irrevocably agrees to sell to CIGA, subject to the fulfilment of the conditions precedent mentioned in 6 below, a participation interest in AES representing 30.5% of the issued quota capital of AES (“CIL’s AES Acquisition”). In addition to, and as a single indivisible transaction with CIL’s AES Acquisition, each of Fundo De Investimento Privado Angola S.C.A. SICAV-SIF (“FIPA”) and Morten Eriksen (“Eriksen”) have irrevocably agreed to purchase – *in respect of FIPA or any of its affiliates, a participation interest in AES, representing 16% of the issued quota capital of AES; and *in respect of Eriksen (or at the written election of Eriksen, CIGA and/or FIPA or any of their appointees), a participation interest in AES, representing 1.5% of the issued quota capital of AES, (collectively the “Acquisition”). Business of AES AES was incorporated in Angola on 9 January 2005 and offers complete waste management services through its facilities to the oil and gas sector in Angola. Rationale for CIL’s AES Acquisition *AES, a business that generated turnover of USD42.6 million in the year ended 31 December 2011, is extremely well placed to benefit from the expansion in oil and gas activities in Angola. It is anticipated that the number of oil rigs operating off-shore in Angola will increase significantly over the next few years. Furthermore changes to environmental legislation enacted in July 2012 will significantly enhance AES’s business going forward. *Angola, a country previously identified as a strategic priority by CIL within which to expand its operations, is one of the fastest growing economies in Africa with significant infrastructure development taking place. In addition, substantial growth is expected in the oil and gas sector currently the bedrock of the Angolan economy. Angola offers CIL with another base from which to operate and identify additional opportunities for the group. *The investment in AES is an infrastructure vertical growth investment for CIL. The group can now leverage this as another platform for growth on the African continent (via specialised waste management services). *AES will increase CIL’s exposure to the growing oil and gas sector, an area to which CIL has to date had limited exposure. *AES has a highly competent and committed management team with outstanding technical expertise which is in line with the management profiles found in CIL’s current businesses. *AES offers a highly scalable platform within the waste management vertical. *AES has a blue chip client base, and resultant order book, consisting of international oil companies operating in Angola. *AES has longer term contracts which provide the cash generating, annuity-type income, previously lacking within CIL. *Potential commercial (customer-centric) synergies exist, as opportunities materialise, to provide electrical and waste management services for on-shore oil assets. *AES is well aligned with the CIL growth strategy focused on operating multiple high-performing infrastructure and service related businesses on the African continent. *Similar to CIL’s previous acquisitions, CIL has identified solid, like minded partners with which to build long term business relationships. Terms of the Acquisition *The aggregate purchase price payable to the Seller by CIGA, FIPA and Eriksen (collectively the “Buyers”) for the aggregate sale quota is USD24 million, which shall be paid by the Buyers on a pro rata basis in accordance with the sale quota ratio purchased by each of the Buyers, provided that where the Buyers are legally required to pay the purchase price in Angolan currency, the purchase price shall be the Kwanza equivalent of USD24 million. *Accordingly, the purchase price payable by CIL to the Seller for its 30.5% interest in AES is USD15.25 million payable in cash. It is anticipated that the purchase price will be funded as to 30% from available cash resources and the remaining 70% through a placement by CIL of additional equity in CIL. Due to the uncertainty in timing as to when all the conditions precedent will be fulfilled, the timing of the placement of the additional equity still has to be determined. *The Effective Date of the Acquisition is the first business day immediately following the date upon which the conditions precedent detailed below, are fulfilled or waived, as the case may be. *From the date of signature of the Acquisition Agreement, the Buyers have the right to actively participate in the management of AES. *The purchase price shall be paid by the Buyers to the Seller by electronic funds transfer, on a date agreed between the parties, but which shall not be later than 45 days following the Effective Date (referred to in Error Reference source not found. above), by when the Parties shall have executed a notary deed of division and transfer of the Aggregate Sale Quota before a notary public with offices in Luanda, Angola.