CIG – renounceable clawback rights offer

CIG shareholders (“Shareholders”) are referred to the announcement dated Thursday, 11 August 2016 relating to the acquisition by CIG of the entire issued share capital of Conlog Proprietary Ltd. (“Proposed Acquisition”), wherein Shareholders were advised that CIG would undertake a fully-underwritten renounceable claw-back rights offer of R750 million (“Rights Offer”) to part fund the purchase consideration payable in respect of the Proposed Acquisition.

At the general meeting of Shareholders held on 15 September 2016 the requisite resolutions were passed, placing the unissued shares of the Company under the control of the board of directors of CIG (“Board”) to allow CIG to issue the Rights Offer Shares as set out in paragraph 2 below. All other conditions precedent of the Proposed Acquisition are now fulfilled and the Proposed Acquisition is now unconditional.

Salient terms of the Rights Offer
CIG proposes to raise R750 million through an offer of 38 860 102 Rights Offer shares (“Rights Offer Shares”) at a price of R19.30 per Rights Offer Share (“Rights Offer Issue Price”) in the ratio of 23.80682 Rights Offer Shares for every 100 existing shares held on the record date for the Rights Offer, being Friday, 11 November 2016.

The Rights Offer Issue Price represents a 19.75% discount to the closing price on Thursday, 27 October 2016.

Application will be made to the JSE for the listing of the letters of allocation and the Rights Offer Shares on the securities exchange of the JSE as follows:

  • letters of allocation in respect of 38 860 102 Rights Offer Shares will be listed from the commencement of business on Wednesday, 9 November 2016 to the close of business on Tuesday, 22 November 2016, both days inclusive, under the JSE code: CILN and ISIN: ZAE000227526; and
  • 38 860 102 Rights Offer Shares will be listed with effect from the commencement of business on Wednesday, 23 November 2016.

The Rights Offer Shares will, upon allotment and issue, rank pari passu with all other shares of the same class. Excess applications will be allowed.

Underwriting
CIG has entered into an underwriting agreement in respect of the Rights Offer with Pinecourt Advisors Ltd., up to a maximum value of R250 million and Investec Bank Ltd., up to a maximum value of R500 million (“Underwriting Agreement”). Further details of the Underwriting Agreement will be set out in the Rights Offer circular dated Tuesday, 8 November 2016 (“Rights Offer Circular”) expected to be distributed to certificated Shareholders on Thursday, 10 November 2016 and to dematerialised Shareholders on Tuesday, 15 November 2016.

Excess applications
Shareholders will have the right to apply for any excess Rights Offer Shares not taken up by other Shareholders, subject to such rights being transferable upon renunciation of the letters of allocation, and any such excess shares will be attributed equitably, taking cognisance of, inter alia, the number of shares and rights held by the Shareholder at the time of allocation, including those taken up as a result of the Rights Offer, and the number of excess rights applied for by such Shareholder.

If you are a certificated Shareholder and you wish to apply for excess Rights Offer Shares, you must complete the form of instruction attached to the Rights Offer Circular in accordance with the instructions contained therein, and enclose payment for such additional Rights Offer Shares with your subscription. The completed form of instruction, together with payment, should be lodged with Computershare Investor Services Proprietary Limited so as to be received by no later than 12:00 on Friday, 25 November 2016.

If you are a dematerialised Shareholder and you wish to apply for excess Rights Offer Shares, you must instruct your Central Securities Depositary Participant (“CSDP”) or broker, in terms of the agreement entered into between them and their CSDP or broker, as to the number of excess Rights Offer Shares for which you wish to apply.

Conditions precedent
The implementation of the Rights Offer is subject to the JSE granting a listing for the letters of allocation and the Rights Offer Shares on the securities exchange of the JSE in respect of the Rights Offer.

Foreign shareholders
Foreign Shareholders may be affected by the Rights Offer, having regard to prevailing laws in their relevant jurisdictions. Such foreign Shareholders should inform themselves about and observe any applicable legal requirements of such jurisdiction in relation to all aspects of this announcement that may affect them, including the Rights Offer. It is the responsibility of each foreign Shareholders to satisfy himself as to the full observation of the laws and regulatory requirements of the relevant foreign jurisdiction in connection with the Rights Offer, including the obtaining of any governmental, exchange or other consents or the making of any filing which may be required, the compliance with other necessary formalities and the payment of any issue, transfer or other taxes or other requisite payments due in such jurisdiction. The Rights Offer is governed by the laws of South Africa and is subject to applicable laws and regulations, including the Exchange Control Regulations.

Salient dates and times
The proposed salient dates and times in respect of the Rights Offer are set out below:

  • Declaration date announcement in respect of the Rights Offer released on the Stock Exchange New Service (“SENS”) – Friday, 28 October 2016
  • Finalisation date announcement in respect of the Rights Offer released on SENS – Thursday, 3 November 2016
  • Last date to trade in Shares for settlement by the initial record date and in order to participate in the Rights Offer – Tuesday, 8 November 2016
  • Listing and trading of letters of allocation on the securities exchange operated by the JSE Ltd. (“JSE”) under JSE code: CILN and ISIN: ZAE000227526 – Wednesday, 9 November 2016
  • Shares commence trading on the JSE ex-Rights Offer entitlement – Wednesday, 9 November 2016
  • Rights Offer Circular including a form of instruction distributed to certificated Shareholders -Thursday, 10 November 2016
  • Record Date for determination of Shareholders entitled to participate in the Rights Offer (Initial Record Date) – Friday, 11 November 2016
  • Dematerialised Shareholders will have their accounts at their CSDP or broker automatically credited with their entitlement – Monday, 14 November 2016
  • Certificated Shareholders on the register will have their entitlement credited to their accounts held with the transfer secretaries – Monday, 14 November 2016
  • Rights Offer opens at 09:00 – Monday, 14 November 2016
  • Rights Offer Circular distributed to those dematerialised shareholders who have elected to receive documents in hard copy – Tuesday, 15 November 2016
  • Last day to trade in the letters of allocation on the JSE in order to settle by close of the Rights Offer – Tuesday, 22 November 2016
  • Rights Offer Shares listed and trading therein commences at 09:00 on the JSE – Wednesday, 23 November 2016
  • Payment to be made and Form of Instruction to be lodged with the transfer secretaries by certificated Shareholders by 12:00 – Friday, 25 November 2016
  • Rights Offer closes at 12:00 – Friday, 25 November 2016
  • Record date for letters of allocation (Final Record Date) – Friday, 25 November 2016
  • Rights Offer Shares issued on – Monday, 28 November 2016
  • Dematerialised Shareholders’ accounts updated and debited by CSDP or broker (in respect of payment for Rights Offer Shares) – Monday, 28 November 2016
  • Certificates distributed to certificated Shareholders (in respect of the Rights Offer Shares) – Monday, 28 November 2016
  • Results of Rights Offer announced on SENS – Monday, 28 November 2016
  • Refunds (if any) to certificated Shareholders in respect of unsuccessful excess applications made – Wednesday, 30 November 2016
  • Dematerialised Shareholders accounts updated and debited by their CSDP or broker (in respect of successful excess applications) – Wednesday, 30 November 2016
  • Certificates distributed to certificated Shareholders (in respect of successful excess applications) – Wednesday, 30 November 2016

Finalisation announcement
It is anticipated that the finalisation announcement for the Rights Offer will be released on SENS on Thursday, 3 November 2016.

Rights Offer Circular
Further details of the Rights Offer will be set out in the Rights Offer Circular which is expected to be distributed to certificated Shareholders on Thursday, 10 November 2016 and to dematerialised shareholders on Tuesday, 15 November 2016. The Rights Offer Circular will be made available on the company’s website www.ciglimited.co.za from Tuesday, 8 November 2016.

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