JSE Sens

DELTA EMD LIMITED - Announcement relating to payment of the Special Dividend in the gross dividend amount of R0.75 per share, Delisting.

18 April 2019 - 11:10 AM
DTA
Announcement relating to payment of the Special Dividend in the gross dividend amount of R0.75 per share, Delisting.

Delta EMD Limited
(Incorporated in the Republic of South Africa)
Registration number 1919/006020/06
ISIN: ZAE000132817
Share code: DTA
(Delta EMD or the Company)

ANNOUNCEMENT RELATING TO:

    .    payment of the Special Dividend in the gross dividend amount of R0.75 per share,
         which Special Dividend will constitute the disposal by Delta EMD of the greater
         part of its assets;
    .    voluntary winding-up of Delta EMD;
    .    appointment of the liquidator;
    .    delisting from the JSE of the Delta EMD Shares; and
    .    posting of Circular and Notice of General Meeting

 Unless otherwise indicated, capitalised words and terms contained in this
 announcement shall bear the same meanings ascribed thereto in the circular to Delta
 EMD Shareholders, issued today, Thursday, 18 April 2019 (Circular).

1. INTRODUCTION

   1.1 Following the approval granted to the Board by Delta EMD Shareholders on 9 May 2014
       to cease and discontinue the business of Delta EMD and its subsidiaries (Group) in a
       phased and orderly manner, Delta EMD embarked on a sale process to dispose of all the
       Groups assets for the best market value with a view to subsequently wind-up or
       deregister Delta EMD, the only company that remains in the Group, after all the cash in
       Delta EMD (less the amount required to settle all the liabilities and the costs of winding-
       up or deregistration) had been distributed to the Delta EMD Shareholders. The
       memorandum setting out details for the proposed winding-up of Delta EMD, dated 4 April
       2014 can be found on the Companys website at www.deltaemd.co.za.

   1.2 In the last quarter of 2018, Delta EMD sold its remaining investments in subsidiary
       companies, pursuant to a transaction which was approved by Delta EMD Shareholders at
       a general meeting held on 12 December 2018.

   1.3   On 29 March 2019, the interim special dividend of R0.70 was approved by the Board,
         payable in April 2019.

   1.4 The only asset of Delta EMD remaining after the payment of the interim dividend is the
       Current Retained Cash.

   1.5 Delta EMD does not meet all of the listing criteria as set out in the Listings Requirements,
       since it has no operating assets or operating businesses, as required in terms of section
       4.28 (d) of the Listings Requirements. Delta EMD is therefore a cash shell and would be
       delisted in terms of section 3.26 of the Listings Requirements unless it acquires viable
       assets within a period of 9 months.

   1.6 The Independent Board has resolved to recommend to Delta EMD Shareholders that the
       Special Dividend be declared and paid to Delta EMD Shareholders and that Delta EMD
       be thereafter voluntarily wound-up, whereupon all the cash in the Company (less the
       amount for satisfying the outstanding liabilities and the costs of the Delisting and the
       Voluntary Winding-up) will be distributed to Delta EMD Shareholders as the Liquidation
       Distribution.
  1.7 As the proposed Special Dividend would constitute a disposal of the major portion of
      Delta EMDs assets, the provisions of Section 112 read with Section 115 would be
      applicable to such Special Dividend.

  1.8 Subject to approval of relevant resolutions at the General Meeting, the JSE has approved
      the delisting of all the issued shares of Delta EMD. Delta EMD Shares will be suspended
      with effect from Wednesday, 17 July 2019 and delisted with effect from Tuesday, 23 July
      2019.

2. SPECIAL DIVIDEND

  2.1 The Independent Board has resolved, having regard to the Fair and Reasonable Opinion,
      the costs relating to this Circular, the Liquidators reasonable estimate of the costs of the
      Voluntary Winding-up (inclusive of a prudent provision for potential contingent or
      unforeseen liabilities) and all other relevant information available to it, to recommend to
      Delta EMD Shareholders that the distribution as a Special Dividend of the substantial
      majority of the Current Retained Cash (which Special Dividend will constitute the disposal
      by the Company of the greater part of its assets) be approved by them in terms of Section
      112, read with Section 115, of the Companies Act.

  2.2 The Board has, by resolution:

      2.2.1    authorised the payment of the Special Dividend based on the recommendation of
               the Independent Board; and
      2.2.2    acknowledged that it has applied the Solvency and Liquidity Test and reasonably
               concluded that Delta EMD will satisfy the Solvency and Liquidity Test
               immediately after completing the payment of the Special Dividend.

  2.3 The final amount of the Special Dividend, as recommended by the Independent Board,
      as at the Last Practicable Date is:

      2.3.1 provisionally estimated to be a gross amount of approximately R0.75 per Delta
      EMD Share, being the sum of R36,874,164.75, payable out of retained earnings, which
      will constitute the disposal by the Company of the greater part of its assets; or.

      2.3.2 an amount which is less than R0.75 per share (as may be determined by the
      Board to take into account unforeseen and/or contingent liabilities that may not have
      been provided for) but will nevertheless still constitute the disposal by the Company of
      the greater part of its assets.

  2.4 The Independent Board has taken all reasonable steps to ensure that, as at the Last
      Practicable Date, adequate provision has been made for potential contingent or
      unforeseen claims in calculating the Special Dividend in the sum of approximately R0.75
      per Delta EMD Share. The risk of unknown and unforeseen claims being submitted
      pursuant to the Voluntary Winding-up cannot however be wholly precluded. The
      Independent Board is of the view that it is unlikely that any claims in excess of the current
      contingency provision will arise. Nevertheless the Board, with the approval of the
      Independent Board, has elected as a precaution to solicit, as far as practicably possible,
      advance notification from potential Delta EMD creditors of such claims, prior to the
      declaration and payment of the Special Dividend, by publishing a notice to creditors to
      that effect. To the extent that any such creditor claims in excess of the aggregate
      contingency provision do arise, this will result in an appropriate adjustment in the amount
      of R0.75 per Delta EMD Share of the Special Dividend insofar as may be necessary to
      settle such claims.
  2.5 The Special Dividend is a dividend as defined in the Income Tax Act and as such will be
       subject to dividend withholding tax at a rate of 20%, save for where Delta EMD
       Shareholders are exempt from the payment of dividend withholding tax. The payment of
       dividend withholding tax will result in a net dividend amount of R0.60 per share (there
       being 49 165 553 Delta EMD Shares in issue and assuming that a Special Dividend in
       the amount of R0.75 per Delta EMD Share is declared and paid by the Board). Deltas tax
       number is 9375057719.


3. VOLUNTARY WINDING-UP OF DELTA EMD


  3.1 Subsequent to the declaration and payment of the Special Dividend by the Board, or the
      declaration and payment by the Board of any other dividend, other than the Special
      Dividend, the Board proposes that Delta EMD be wound-up by way of a shareholders
      voluntary winding-up in terms of Section 80 of the Companies Act.

  3.2 The Board has agreed with PricewaterhouseCoopers that it will, subject to the requisite
      approval of Delta EMD Shareholders, be agreeable to be appointed as Liquidator of Delta
      EMD in its Voluntary Winding-up.

  3.3 Accordingly, a special resolution is contained in the Notice of General Meeting which
      provides for the voluntary winding-up of Delta EMD and the appointment of
      PricewaterhouseCoopers as the liquidator subject to the approval of the Master.

  3.4 Further details pertaining to the Voluntary Winding-up are contained in the Circular to
      Delta EMD Shareholders.

4. TAX IMPLICATIONS OF THE SPECIAL DIVIDEND AND THE LIQUIDATION DISTRIBUTION

     4.1 The Special Dividend or any other dividend declared and paid by the Board, will be
          made from aggregated retained earnings and will be subject to dividend tax in terms
          of the Income Tax Act.

     4.2 The Liquidation Distribution will be made out of retained earnings and capital and, to
          the extent made out of retained earnings, will be subject to dividend tax and, to the
          extent made out of capital, will be subject to capital gains tax in terms of the Income
          Tax Act, details of which will be contained in the distribution announcement to be
          made by the Company. The Liquidation Distribution will be paid based on the
          liquidation and distribution account approved by the Master and will consist of the
          nominal amount of cash left in Delta EMD. There will only be one Liquidation
          Distribution which will be paid after the Delisting.

5. OPINIONS AND RECOMMENDATION

  5.1 Opinion of Independent Expert

      Regulation 90(1)(a) of the Companies Regulations requires that a fair and reasonable
      opinion be provided to Delta EMD Shareholders for consideration regarding the Special
      Dividend. In this regard, the Fair and Reasonable Opinion is contained in Annexure 1 of
      the Circular and is available for inspection in the manner set out in paragraph 17 of the
      Circular. The substance of the Fair and Reasonable Opinion is that having considered the
      proposed Special Dividend, the Independent Expert is of the opinion that it is fair and
      reasonable for Delta EMD Shareholders to support the resolutions to be proposed at the
      General Meeting.
  5.2 Independent Board Opinion and Recommendation in respect of the Special
      Dividend

       The Independent Board, after due consideration of the proposed Special Dividend and
       the Fair and Reasonable Opinion:

           .   has determined that it will place reliance on the Fair and Reasonable Opinion for
               purposes of reaching its own opinion regarding the proposed Special Dividend;
               and
           .   is of the opinion that the Special Dividend is in the best interest of Delta EMD
               Shareholders and, accordingly, recommends that Delta EMD Shareholders vote
               in favour of the resolutions to be proposed at the General Meeting to approve
               and implement the Special Dividend or any amount less than the Special
               Dividend as determined by the Board in order to take into account unforeseen
               and/or contingent liabilities that may have not been provided for.

  5.3 Board Opinion and Recommendation in respect of the Voluntary Winding-up of
      Delta EMD

       The Directors are of the opinion that the Voluntary Winding-up is in the best interests of
       Delta EMD and the Delta EMD Shareholders. Accordingly, the Directors recommend that
       Delta EMD Shareholders vote in favour of the resolutions, to be proposed at the General
       Meeting to approve and implement the Voluntary Winding-up and the delisting of the
       Delta EMD Shares from the JSE.

5. Posting of the Circular and notice of General Meeting of Shareholders

  Delta EMD Shareholders are hereby advised that the Circular has been posted to them today,
  Thursday, 18 April 2019. The Circular incorporates a notice convening the General Meeting.
  The general meeting will be held at 10 Bompas Road, Dunkeld, Johannesburg on Monday, 10
  June 2019 at 09:00, at which the requisite resolutions to approve the Special Dividend, the
  Voluntary Winding-up, the Delisting and related matters will be considered and, if deemed fit,
  approved with or without modification.

  Copies of the Circular may also be downloaded from the Companys website, namely,
  http://www.deltaemd.co.za

6. Important dates and times




                                                                                     2019



    Final reviewed results of the Company for the year ended 27 December                     Friday, 29 March
    2018 published

    Record date to determine Delta EMD Shareholders eligible to receive                        Friday, 12 April
    the Circular and Notice of General Meetingb

    Announcement regarding convening of General Meeting and posting of                      Thursday, 18 April
    Circular published through SENS on
Circular, inclusive of Notice of General Meeting, posted to entitled        Thursday, 18 April
Shareholders on

Announcement regarding convening of General Meeting and posting of           Tuesday, 23 April
Circular published in the press on

Last day to trade on the JSE in Delta EMD Shares in order to be              Tuesday, 28 May
recorded in Delta EMDs share register and thereby to be entitled to
attend, participate in and vote at the General Meetingb

Record date to be entitled to attend, participate in and vote at the           Friday, 31 May
General Meeting, by close of trading on the JSE onb

For effective administration, completed Forms of Proxy for General           Thursday, 6 June
Meeting to be received by Transfer Secretariesc by not later than 09:00
on

Last date and time for Delta EMD Shareholders to give notice to Delta        Monday, 10 June
EMD objecting, in terms of section 164(3) of the Companies Act, to the
Special Resolution approving the Special Dividend, for purposes of the
Appraisal Rights by 09:00 on

General Meeting held at 09:00 on                                             Monday, 10 June

Results of General Meeting published through SENS on                         Monday, 10 June

Results of General Meeting published in press on                            Tuesday, 11 June

If the Special Dividend is approved by DELTA EMD Shareholders
at the General Meeting with sufficient voting rights such that no
Shareholder may require the Company to obtain Court approval
for the Special Dividend as contemplated in section 115(3)(a) of
the Companies Act:

Last day for Shareholders who voted against the Special Dividend to         Tuesday, 18 June
require DELTA EMD to seek Court approval for the Special Dividend in
terms of section 115(3)(a) of the Companies Act if the Special Dividend
is approved by Shareholders at the General Meeting but the Special
Resolution was opposed by at least 15% of the voting rights that were
exercised on the Special Resolution at the General Meeting (where
applicable) (5 business days after General Meeting)

Last date on which DELTA EMD Shareholders can make application to           Tuesday, 25 June
the Court in terms of section 115(3)(b) of the Companies Act on (10
business days after General Meeting)

Last date for DELTA EMD to give notice of adoption of the Special           Tuesday, 25 June
resolution approving the Special Dividend to DELTA EMD Shareholders
objecting to the special resolution on

Obtain TRP Compliance certificate                                         Wednesday, 26 June
Finalisation Date announcement expected to be released on SENS on
                                                                            Thursday, 27 June
or about (to be announced by 11:00)
       Finalisation Date announcement expected to be published in the press                                             Friday, 28 June
       on or about

       Last day to trade to be eligible to receive the Special Dividend and                                           Tuesday, 16 July
       possible liquidation dividend

       Suspension of Delta EMD Shares on JSE at commencement of trade                                               Wednesday, 17 July

       Record Date for Special Dividend                                                                                  Friday, 19 July

       Special Dividend payment date                                                                                   Monday, 22 July

       Delisting of Delta EMD from JSE at commencement of trade                                                       Tuesday, 23 July




Notes:


(a)   All of the above dates and times, which are local South African dates and times, are subject to change. Any
      changes will be published through SENS and, as appropriate, in the press.


(b)   Pursuant to section 62(3)(a) as read with section 59(1) of the Companies Act, the date determined by the Board to
      be the record date for purposes of determining Delta EMD Shareholders entitled to receive this Circular and Notice of
      General Meeting is Friday, 12 April 2019. Furthermore, only Delta EMD Shareholders who are registered in the
      securities register of the Company on Friday, 31 May 2019, will be entitled to participate in and vote at the General
      Meeting.


(c)   Delta EMD Shareholders should note that pursuant to the T+3 Strate settlement protocol, the last day to trade in and
      to acquire Delta EMD Shares in order to be capable of being registered as the holder thereof by the above indicated
      record date, is Tuesday, 28 May 2019.


(d)   Should Forms of Proxy not be returned to the Transfer Secretaries by 09:00 on Thursday, 6 June 2019 they may
      nevertheless be handed to the Chairperson of the General Meeting at any time before the commencement of the
      General Meeting.


(e)   Should the General Meeting be adjourned or postponed, Forms of Proxy submitted for the General Meeting will
      remain valid in respect of any such adjournment or postponement.


(f)   Share certificates may not be Dematerialised or rematerialised after the last day to trade for the payment.

(g) Payment date for any possible/expected Liquidation Distribution will be announced in the press in due course.

7. Responsibility statement

The Board and the Independent Board, collectively and individually, accept responsibility for the
information contained in this announcement and confirm that, to the best of each members
respective knowledge and belief, the information contained in this announcement is true and does
not omit anything likely to affect the importance of such information.

Nelspruit
18 April 2019
Sponsor: Deloitte & Touche Sponsor Services (Pty) Ltd

Corporate Law Advisers: Taback and Associates Proprietary Limited

Independent Expert: BDO Corporate Finance Proprietary Limited

Date: 18/04/2019 11:10:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
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