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GNDE - GRINDROD LIMITED - Final Terms and Pro Forma Financial Effects of The Bookbuild Placement The Consortium Placement and The Acquisition

18/06/2014 14:00:00

GNDP GND 201406180028A
Final Terms and Pro Forma Financial Effects of The Bookbuild Placement, The Consortium Placement and The Acquisition

GRINDROD LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1966/009846/06)
Ordinary share code and ISIN: GND and ZAE000072328
Preference share code and ISIN: GNDP and ZAE000071106
(“Grindrod” or “the Company”)

FINAL TERMS AND PRO FORMA FINANCIAL EFFECTS OF THE BOOKBUILD PLACEMENT, THE CONSORTIUM
PLACEMENT AND THE ACQUISITION OF BLACK ECONOMIC EMPOWERMENT (“BEE”) INTERESTS IN GRINDROD
SUBSIDIARIES

1. Introduction

Grindrod shareholders are referred to the announcements released on the Stock Exchange News Service (“SENS”) on
28 March 2014, 8 April 2014 and 9 May 2014 and to the circular issued to Grindrod shareholders on 28 March 2014, relating to,
inter alia:

(i) the specific issue of shares to qualifying investors by way of an accelerated bookbuild offering (“Bookbuild Placement”);
(ii) a specific issue of shares to a consortium of black strategic investors including Brimstone Investment Corporation
Limited, Calulo Newco Proprietary Limited and Solethu Investments Proprietary Limited (“Consortium Placement”); and
(iii) the proposed acquisition of BEE interests in certain operating subsidiaries of Grindrod (“Acquisition”),
(collectively, the “Transactions”).

2. Bookbuild Placement

The Bookbuild Placement was successfully priced on Friday, 9 May 2014, as announced on SENS. Consequently, 96 000 000
new Grindrod shares (“Bookbuild Shares”) were placed with qualifying investors at an issue price of R25.00 per Bookbuild
Share, for gross proceeds of R2.4 billion.

The Bookbuild Shares commenced trading on Friday, 16 May 2014.

3. Consortium Placement

All of the material agreements necessary to establish consortium special purpose vehicles (“Consortium SPVs”) and to give
effect to the Consortium Placement have been concluded and signed.

The Consortium Placement will result in the issue of 64 000 000 new Grindrod shares (“Consortium Shares”) at an issue price
of R25.00 per Consortium Share, raising a total of R1.6 billion.

The Consortium Placement is inter-dependent with the Acquisition and is subject to the fulfilment (or waiver, where applicable)
of the following material conditions precedent:
- all of the written agreements becoming unconditional in accordance with their respective terms;
- signature of agreements for the obtaining of preference share funding for the Consortium SPVs (including the preference
shares referred to in note (6) below);and
- the JSE approving the independent expert opinion on the terms of the Consortium Placement.

The effective date of the Consortium Placement is expected to be on or about 30 June 2014.

4. Acquisition

All of the material agreements required to give effect to the Acquisition have been concluded and signed.

The Acquisition is subject to the fulfilment (or waiver, where applicable) of the following material conditions precedent:
- all of the written agreements becoming unconditional in accordance with their respective terms;
- signature of a relationship agreement to govern the relationship between Grindrod, the black strategic investors referred in
paragraph 1(ii) above and the Consortium SPVs;
- signature of shareholders' agreements for certain of the Consortium SPVs (as well as a deed of adherence to an existing
shareholders' agreement for one of Grindrod's operating subsidiaries);
- Competition Tribunal approval being obtained which is required to give effect to the Acquisition; and
- the JSE approving the independent expert opinion on the terms of the Acquisition.

The effective date of the Acquisition is expected to be on or about 30 June 2014.

5. Small related party transaction

In terms of the JSE Limited Listings Requirements, the Acquisition is a small related party transaction for Grindrod. As such,
BDO Corporate Finance (“BDO”) has provided the board of directors of Grindrod with written confirmation, in its capacity as
independent professional expert, confirming that the Acquisition is fair to Grindrod shareholders.

BDO's opinion, the content of which is still subject to JSE approval, will be available for inspection at the registered office of
Grindrod.

6. Unaudited pro forma financial effects

The updated pro forma financial effects of the Bookbuild Placement and the Consortium Placement together with the pro forma
financial effects of the Acquisition are set out below.

These pro forma financial effects are the responsibility of the board of directors of Grindrod and are provided for illustrative
purposes only. Due to the nature of these pro forma financial effects, they may not fairly present the Grindrod group's financial
position, results of its operations, changes in equity or cash flows after the Transactions.

Published Adjustments Adjustments Adjustments Pro forma % Change
and audited for the for the for the after the
Bookbuild Consortium Acquisition Transactions
Placement Placement
Earnings per share
- basic (cents) 199.1 (27.8) (9.6) 70.9 232.6 16.8
- diluted (cents) 198.3 (27.6) (9.6) 70.7 231.8 16.9
Headline earnings per share
- basic (cents) 118.7 (16.6) (3.8) 13.2 111.5 (6.1)
- diluted (cents) 118.2 (16.5) (3.6) 13.1 111.2 (5.9)
Net Asset Value (“NAV”) per 2 050.9 59.1 29.8 48.4 2 188.2 6.7
share (cents)
Tangible NAV per share (cents) 1 939.4 74.6 38.1 (98.6) 1 953.5 0.7
Number of shares in issue (‘000) 591 586 96 000 64 000 - 751 586 27.0
Weighted average number of 591 109 96 000 64 000 - 751 109 27.1
shares in issue (‘000)
Weighted average diluted number 593 665 96 000 64 000 - 753 665 27.0
of shares in issue (‘000)

Notes and assumptions:

(1) The statement of financial position and statement of comprehensive income of Grindrod were extracted from its published, audited
financial statements for the 12 months ended 31 December 2013.
(2) The pro forma statement of comprehensive income was prepared on the assumption that the Transactions were implemented on 1
January 2013.
(3) The pro forma statement of financial position was prepared on the assumption that the Transactions were implemented on 31
December 2013.
(4) The effects of the Bookbuild Placement are based on R2.4 billion (before estimated transaction costs of R25 million) being raised by
way of the Bookbuild Placement at an issue price of R25.00, resulting in the issue of 96 000 000 Bookbuild Shares.
(5) The effects of the Consortium Placement are based on R1.6 billion (before estimated transaction costs of R18 million) being raised by
way of the Consortium Placement at an issue price of R25.00, resulting in the issue of 64 000 000 Consortium Shares.
(6) The effects of the Consortium Placement are based on the assumption that financial assistance, by way of a preference share
investment of R400 million, was provided to the Consortium SPV by Grindrod at an average effective rate of prime plus 0.30% and
that the total shares of the Consortium are held as second cession security over the funding, with the final redemption date being six
years after the subscription date.
(7) No adjustments have been made for interest earned on the net cash proceeds of Bookbuild Placement and Consortium Placement,
as per the “Guide on pro forma financial information” issued by the South African Institute of Chartered Accountants.
(8) The effects of the Acquisition are based on a total consideration of R685 million.
(9) The effects of the Acquisition are based on the consolidation of R93 million additional minority interest earnings acquired and a R434
million profit on sale of investment. This profit on sale of investment is recognised on the joint ventures being acquired as subsidiaries
in terms of IAS 28 Investments in Associates and Joint Ventures and is a once-off, non headline earnings adjustment.
(10) The excess of the consideration over the net asset value of the investments acquired has been recognised in goodwill for the
purposes of the pro forma financial effects. In terms of IFRS 3 Business Combinations, a portion of this may be accounted for as
intangible asset, which will attract amortisation costs.
(11) Once-off transaction costs of R43 million (exclusive of VAT) were assumed and debited to share premium.
(12) All adjustments above have a continuing effect except where otherwise stated.
(13) There are no other post balance sheet events requiring adjustments to the pro forma financial information.

Durban
18 June 2014

Merchant bank and transaction sponsor
RAND MERCHANT BANK (A division of FirstRand Bank Limited)

Sponsor
Grindrod Bank Limited

Legal adviser
Edward Nathan Sonnenbergs Inc.

Reporting accountants
Deloitte

Date: 18/06/2014 02:00:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.

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