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ZARCLEAR HOLDINGS LIMITED - Update on the proposed delisting of Zarclear

2020/06/30 10:45:00

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                    Update on the proposed delisting of Zarclear

(Incorporated in South Africa)
(Registration number 2000/013674/06)
Share code: ZCL ISIN: ZAE000262820
(“Zarclear” or the “Company”)


1.   Introduction

     Shareholders are referred to the update announcement released on SENS on 13 May 2020, wherein shareholders
     were advised that:

     1.1.   the board of directors of Zarclear (the “Board”) resolved that, subject to securing the requisite approval
            from its shareholders in a general meeting and the JSE approving the Company’s delisting application, it
            would be in the best interests of the Company to seek a delisting of the Company’s shares from the JSE
            and A2X (the “delisting”) ; and

     1.2.   in compliance with the JSE Listings Requirement and A2X Listing Requirement that the delisting must be
            accompanied by an offer to be made to holders of all the Company’s listed securities (the “ZCL shares”),
            the Board further resolved to proceed with its envisaged share repurchase offer to repurchase all, or a
            portion of, the ZCL shares from any shareholder who, post the approval of the delisting, either cannot or
            does not wish to continue to hold ZCL shares in an unlisted structure, at an offer price of R4.40 per share
            (the “share repurchase offer”).

     Shareholders are advised that the Company has received notification from Legae Peresec Capital Proprietary
     Limited (“Legae Peresec Capital”) that it has acquired additional ZCL shares such that Legae Peresec Capital’s
     total beneficial interest is now 30.08% of Zarclear’s total issued ordinary shares. Legae Peresec Capital has
     informed the Board that whilst it is supportive of the delisting, it does not support the deployment of Zarclear’s
     balance sheet to fund the cash offer that will need to be made in order for Zarclear to effect the delisting. Legae
     Peresec Capital has proposed that Zarclear proceed with the delisting on the basis that, subject to the delisting
     being approved in accordance with all regulatory requirements, Legae Peresec Capital will make the required
     cash offer to purchase ZCL shares from any shareholder who either cannot or does not wish to continue to hold
     ZCL shares in an unlisted structure, at an offer price of R4.40 cents per ZCL share (the “cash offer”).

     The cash offer would be made by Legae Peresec Capital in compliance with the relevant provisions of the
     Companies Act 71 of 2008 (the “Companies Act”), the Takeover Regulations promulgated thereunder (the
     “Takeover Regulations”) and the JSE Listings Requirements.

     In light of the above, the Board has resolved to proceed with the delisting but on the basis that the offer that is
     required to accompany the delisting will no longer be made by the Company by way of the share repurchase offer
     pursuant to a share repurchase made by the Company (as previously announced). Instead, the offer that is to
     accompany the delisting will (subject to the formalisation of arrangements between the Company and Legae
     Peresec Capital) be made by Legae Peresec Capital (at the same R4.40 cash offer price per share) by way of a
     general offer.

2.   Shareholder approval

     The delisting will be conditional on securing the approval of more than 50% of the votes of all shareholders
     present or represented by proxy at a general meeting, excluding any controlling shareholder, its associates and
     any party acting in concert, and any other party which the JSE deems appropriate, being cast in favour of such
     delisting resolution.

3.   Legae Peresec Capital mandatory offer

     If the cash offer is made and accepted by shareholders holding at least 11 122 994 ZCL shares, this will result in
     Legae Peresec Capital acquiring ZCL shares equal to or exceeding 35% of the issued share capital of Zarclear. In
     consequence, a mandatory offer will be triggered by Legae Peresec Capital in favour of holders of ZCL shares in
     terms of section 123 of the Companies Act and the Takeover Regulations. Subject to the Board being satisfied
     that the cash offer is fair to the shareholders of the Company (excluding Legae Peresec Capital) and the Board
     being so advised by an independent expert appointed for this purpose, the Board will propose the delisting to the
     Company’s shareholders on the basis that Legae Peresec Capital will make a cash offer to all Zarclear
     shareholders at a price of R4.40 per ZCL share. This offer will be in fulfilment of the offer obligations imposed
     by paragraph 1.15 of the JSE Listings Requirements, paragraph 4.14 of the A2X Listings Requirements and the
     mandatory offer provisions of the Companies Act and Takeover Regulations.

4.   Appointment of an independent board and an independent expert

     In accordance with the provisions of the Companies Act and the Takeover Regulations, an independent sub-
     committee of the Board (the “Independent Board”) has been formed for purposes of considering the cash offer.

     The Independent Board has appointed Nodus Capital TS Proprietary Limited (“Nodus”) to provide the
     independent board with its opinion as to whether the terms of the cash offer are fair and reasonable to Zarclear
     shareholders, in accordance with the Takeover Regulations, the JSE Listings Requirements and the A2X Listings

     Nodus’ full report, as well as the independent board’s opinion on the cash offer, will be included in the circular
     to be posted to Zarclear shareholders.

5.   Conditions precedent to the delisting and cash offer

     The delisting and cash offer will be subject to the following conditions precedent:

     5.1.   an independent expert being appointed by the Independent Board (that is acceptable to the JSE) and
            providing the Independent Board and the Board with an opinion in which the independent expert expresses
            the view that the cash offer is fair to shareholders;

     5.2.   both the Board and the Independent Board unanimously resolving to proceed with the delisting and
            confirming that the cash offer is fair;

     5.3.   the delisting being approved by the requisite majority of Zarclear shareholders in terms of the JSE Listings
            Requirements and A2X Listings Requirements;

     5.4.   to the extent necessary, the securing of any approval required by the Competition Authorities in terms of
            the Competition Act 89 of 1998, as amended; and

     5.5.   the Offeror, prior to the issue of the circular regulating the delisting and cash offer, providing an
            unconditional confirmation and/or bank guarantee to the TRP in accordance with Regulations 111(4) and
            111(5) of the Takeover Regulations.

6.    Documentation and timing in relation to the delisting and cash offer

      Full details of the delisting and cash offer will be set out in a circular which will be distributed by Zarclear to its
      shareholders in due course and will include the opinion of the independent expert in respect of the cash offer, a
      notice of general meeting of Zarclear shareholders to approve the delisting and the applicable salient dates and
      times relating to the delisting and the cash offer.

      This announcement does not constitute an offer, undertaking or firm intention to make an offer by Legae Peresec
      Capital to Zarclear shareholders.

7.    Zarclear Board responsibility statement

      The members of Zarclear Board collectively and individually accepts responsibility for the accuracy of the
      information contained in this announcement and certifies that, to the best of its knowledge and belief, the
      information contained in this announcement relating to Zarclear is true, this announcement does not omit anything
      that is likely to affect the import of such information, and that all reasonable enquiries to ascertain such
      information has been made.

30 June 2020

Corporate advisor and sponsor to Zarclear
Java Capital

Date: 30-06-2020 10:45:00
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