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ARDEN CAPITAL LTD - Announcement in relation to African Sun’s offer to acquire the entire issued ordinary shares of Dawn Properties
2020/09/22 15:12:00Download PDF Stock report
Announcement in relation to African Sun’s offer to acquire the entire issued ordinary shares of Dawn Properties
Arden Capital Limited
(formerly Brainworks Limited)
(Incorporated in the Republic of Mauritius)
(Registration number: 115883 C1/GBL)
Share Code: ACZ
ISIN: MU0548S00026
(“Arden Capital” or “the Company”)
Announcement in relation to African Sun’s offer to acquire the entire issued ordinary shares of
Dawn Properties’ and withdrawal of cautionary announcement
1. Introduction
1.1. Shareholders are referred to the cautionary announcement published on 03 June 2020 and the
renewal cautionary announcements published on 15 July 2020 and 27 August 2020, wherein
shareholders were advised that African Sun Limited (“African Sun”) was in negotiations with
Dawn Properties Limited (“Dawn”) for the acquisition of 100% of the issued ordinary shares of
Dawn, in exchange for African Sun ordinary shares.
1.2. Shareholders are advised that African Sun has today, 22 September 2020, released a circular
to African Sun shareholders containing details of an offer to Dawn, wherein African Sun seeks
to acquire all the issued ordinary shares of Dawn, for an aggregate consideration of 1 African
Sun ordinary share for every 3.988075946 Dawn ordinary shares held (“the Transaction”). The
circular can be viewed at the following link: https://www.africansunhotels.com/downloads.
1.3. If the Transaction is successful, it will be followed by the voluntary delisting of Dawn’s ordinary
shares from the Zimbabwe Stock Exchange (“ZSE”).
2. Overview of African Sun
2.1. African Sun is a hotel management company listed on the ZSE, with seven resort hotels, four
city hotels and two casinos under its management. Seven of the hotels are owned by Dawn.
2.2. Arden Capital currently holds 57.67% of the issued ordinary shares of African Sun.
3. Overview of Dawn
3.1. Dawn is a real-estate investment holding, development and property consulting services
company listed on the ZSE, with a hotel dominated investment property portfolio.
3.2. Arden Capital currently holds 66.81% of the issued ordinary share capital of Dawn.
4. Rationale for the Transaction
4.1. Following the Transaction, Arden will hold an effective interest 61.48% in African Sun, which
will in turn hold 100% of the issued share capital of Dawn. It is anticipated that consolidation of
African Sun and Dawn’s businesses will create a robust balance sheet, with enhanced financial
leverage for unlocking future developmental capital for the combined business to survive the
Covid-19 downturn, protect jobs, as well as guarantee future for the business and its
stakeholders.
4.2. The Transaction will also result in shared costs and improved efficiencies, including compliance
costs of a double-listing of essentially the same business, cognisant of the fact that Dawn’s
revenues are tied to the current African Sun operations.
4.3. The structure of the Transaction will further enable Dawn shareholders to participate in holding
shares in an enlarged and financially robust entity with exciting and executable growth
prospects geared towards both the property and hospitality sectors in Zimbabwe.
5. Transaction Consideration
5.1. The consideration for the Transaction will be settled by the issue of 616 129 718 new African
Sun ordinary shares to all Dawn shareholders, based on a swap ratio of 1 African Sun ordinary
share for every 3.988075946 Dawn ordinary shares held.
6. Conditions Precedent
6.1. The Transaction is subject to the fulfilment of the following conditions precedent:
6.1.1. approval of the Transaction by the requisite majority of African Sun shareholders at a general
meeting, to be held on 13 October 2020; and
6.1.2. approval from the following regulators, where applicable, the ZSE, Competition and Tariffs
Commission and the Exchange Control Authorities.
7. Effective Date
The effective date of the Transaction will be two days after the fulfilment of all the conditions
precedent.
8. Financial Information
8.1. Based on audited historical and inflation adjusted amounts, the net asset value (“NAV”) of
African Sun as at 31 December 2019 was Zimbabwean Dollar (“ZWL”) 469.8 million and ZWL
660.7 million respectively, whilst the historical and inflation adjusted net profit after tax (“PAT”)
for the year ended 31 December 2019 was ZWL 106.5 million and ZWL 187.0 million
respectively. These amounts have been extracted from the African Sun audited financial results
for the year ended 31 December 2019.
8.2. Based on audited historical and inflation adjusted amounts, Dawn’s NAV as at 31 December
2019 was ZWL 1.48 billion and ZWL 1.43 billion, respectively, whilst the historical and inflation
adjusted PAT was ZWL 1.38 billion and ZWL 0.86 billion, respectively. These amounts have
been extracted from the Dawn audited financial results for the year ended 31 December 2019.
9. Categorisation
In terms of the JSE Limited Listings Requirements, the Transaction is uncategorised.
10. Withdrawal of Cautionary Announcement
Shareholders are further advised that, pursuant to the publication of this announcement, the
cautionary announcement is withdrawn.
Grand Baie, Mauritius
22 September 2020
Sponsor
Questco Corporate Advisory Proprietary Limited
Date: 22-09-2020 03:12:00
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