Description
Announcement by Oando of the acquisition of minority interests in certain subsidiaries and the reorganization of its marketing business.
Proof 2 Bus Day and Beeld on the 08/06/07 size 38x7 Spell Check DC Angela Teeling-Smith 011 775 7301 011 775 7617 082 825 5167
ACQUISITION OF MINORITY INTERESTS IN CERTAIN SUBSIDIARIES, RE-ORGANISATION
OF MARKETING BUSINESS AND CAUTIONARY ANNOUNCEMENT
Oando Plc
1. INTRODUCTION
Shareholders are advised that Oando will be posting shareholder documentation on 7 June 2007 relating to proposals in terms of which Oando will: – acquire the interests Ocean and Oil Investments Limited (“OOI”), Oando’s major shareholder, in certain jointly held subsidiaries; – acquire the interests of certain minority shareholders in Gaslink Nigeria Limited (“Gaslink”). Shareholders are further advised that Oando will post shareholder documentation relating to an internal re-organisation of the Company’s downstream petroleum marketing business on or about 13 June 2007. Under Nigerian law the acquisitions and the internal re-organisation will be effected by way of two separate schemes of arrangement.
(Incorporated in Nigeria and registered as an external company in South Africa) Registration number: RC 6474 (External company registration number: 2005/038824/10) Share code on the JSE Limited: OAO Share code on the Nigerian Stock Exchange: UNTP ISIN: NG00000UNTP0 (“Oando” or “the Company”)
3. SCHEME OF ARRANGEMENT INVOLVING OANDO MARKETING LIMITED
3.1 Rationale and terms Oando’s downstream marketing unit, unlike its other lines of business, does not exist as a separate legal entity that is 100% owned by Oando. This limits Oando’s options for accessing the capital markets to raise capital for its marketing operations. Oando therefore wishes to undertake an internal re-organisation in terms of which it will transfer its downstream petroleum marketing business to a newly created legal entity, Oando Marketing Limited (“Oando Marketing”), in exchange for the entire issued share capital of Oando Marketing. Following implementation of the scheme of arrangement, Oando Marketing will commence business as a wholly-owned subsidiary of Oando. 3.2 Conditions precedent to the scheme of arrangement The scheme of arrangement is subject, inter alia, to the following conditions precedent: – the ratification, with or without modification, by the holders of Oando shares, which ratification shall be evidenced by a resolution of a majority representing (75%) in value of the votes exercisable by holders of Oando shares present and voting either in person or by proxy at a Court convened meeting; and – the Court sanctioning the scheme.
2. SCHEME OF ARRANGEMENT INVOLVING OOI AND GASLINK
2.1 Rationale The Board and management of Oando are committed to achieving world-class standards of corporate governance. To this end, the ownership structure and management of Oando’s subsidiaries was reviewed to identify areas in which conflicts of interest might arise. The following subsidiaries, which are 51% held by Oando and 49% held by OOI (save for Oando Production and Development Company Limited which is 39% held by OOI), Oando’s single largest shareholder with a 23.66% equity holding, were identified as having the potential to generate conflicts of interest: – Oando Supply and Trading Limited; – Oando Trading (Bermuda) Limited; – Oando Production and Development Company Limited; – Oando Energy Services Limited; and – Oando Exploration and Production Company Limited. Potential conflicts could arise for the following reasons: – OOI owns a direct equity stake in Oando as well as in the jointly held subsidiaries; – four directors of OOI sit on the board of Oando as well as the boards of the jointly held subsidiaries; and – Oando has management control of the jointly held subsidiaries and transacts a considerable amount of business with said subsidiaries. Accordingly, it is the view of the Board that, under the current structure OOI’s interests are not 100% aligned with the interests of Oando’s other shareholders as OOI disproportionately receives the benefits that arise out of business decisions pertaining to the jointly held subsidiaries where Oando and its other shareholders bear a disproportionate share of the associated costs. It has therefore been proposed that Oando acquire the entire equity holding of OOI in each of the jointly held subsidiaries such that upon conclusion of the scheme of arrangement such subsidiaries will be wholly owned by Oando. Similarly, Oando holds a 59.96% equity stake in Gaslink and has been in discussions with the other shareholders of Gaslink to acquire the entire issued share capital of Gaslink. Gaslink operates in a high margin sector of the energy spectrum and revenue from its operations will provide a diversified, increased and sustainable profitability for shareholders of Oando. Twelve of the minority shareholders have agreed to dispose of their equity stakes in Gaslink which will be acquired by Oando thereby increasing the Company’s equity holding in Gaslink to 98% on implementation of the scheme of arrangement. 2.2 Consideration Under the scheme of arrangement, it is proposed that that Oando acquire from OOI: – 2 450 000 ordinary shares of Naira 1.00 each in Oando Supply and Trading Limited in exchange for the issue of 9 102 864 ordinary shares of 50 kobo each in Oando (“Oando shares”); – 5 880 ordinary shares of US$1.00 each in Oando Trading (Bremuda) Limited in exchange for the issue of 33 671 408 Oando shares; – 4 410 000 ordinary shares of Naira 1.00 each in Oando Production and Development Company Limited in exchange for the issue of 42 350 579 Oando shares; – 2 450 000 ordinary shares of Naira 1.00 each in Oando Energy Services Limited in exchange for the issue of 6 998 870 Oando shares; and – 2 450 000 ordinary shares of Naira 1.00 each in Oando Exploration and Development Company Limited in exchange for the issue of 26 054 272 Oando shares. Pursuant to the scheme of arrangement OOI will hold approximately 34% of Oando’s enlarged issued share capital. In addition, Oando will acquire 635 916 333 ordinary shares of 50 kobo each from the twelve transacting minority shareholders of Gaslink in exchange for the issue of 63 591 633 Oando shares. Application for the listing of the additional ordinary shares will be made in due course. 2.3 Conditions precedent to the scheme of arrangement The scheme of arrangement is subject, inter alia, to the following conditions precedent: – the ratification, with or without modification, by the holders of Oando shares, which ratification shall be evidenced by a resolution of a majority representing (75%) in value of the votes exercisable by holders of Oando shares present and voting either in person or by proxy at a Court convened meeting; and – the Court sanctioning the scheme. 2.4 Other proposals At the Court convened meeting Oando shareholders will also be asked to approve: – an increase in the authorised share capital of Oando by the creation of 200 000 000 Oando shares; – amend the articles of association of Oando to reflect the increased authorised share capital; – amend the articles of association of Oando to enable the Company to receive consideration for the issuance of shares in either cash and/or valuable consideration, other than cash. Such resolutions will need to registered by the Registrar of Companies in South Africa in order to be effective.
4. REQUIREMENTS OF THE JSE LIMITED
Shareholders are advised that the documentation relating to the two schemes of arrangement have not been approved by the JSE Limited (“JSE”). At the time of the secondary listing of Oando on the JSE, Oando undertook to comply in full with the Listings Requirements of the JSE (“Listings Requirements”), save where such requirements are in direct contravention of the Companies and Allied Matters Act requirements or any associated legislation or regulation. The scheme of arrangement involving Oando and OOI and certain shareholders of Gaslink comprises transactions which require compliance with the Listings Requirements, as follows: – OOI holds 23.66% of the issued shares in Oando and is accordingly a related party to Oando; – one of the twelve transacting shareholders, Forte Properties and Investments Limited, holds 12.59% of Gaslink and is accordingly a related party to Oando; and – the consideration shares to be issued to OOI by Oando represent 20.65% of Oando’s current issued share capital and accordingly this portion of the transaction is a Category 2 transaction. Accordingly, the JSE has ruled that: – the scheme document relating to a scheme of arrangement involving Oando and OOI and certain shareholders of Gaslink must be submitted to the JSE for review prior to the scheme meeting; – the JSE may require Oando to post a supplementary circular to shareholders containing such additional Category 2 and related party information as it may deem necessary; – Oando remain under cautionary until pro forma financial statements together with a reporting accountants’ report thereon produced in accordance with the Listings Requirements has been submitted to the JSE and the financial effects have been published, which must occur prior to the scheme meeting; – OOI be precluded from voting on the resolution pertaining to the to the acquisition by Oando of OOI’s stake in the jointly held subsidiaries; – any Gaslink minority shareholders who are also shareholders of Oando be precluded from voting on the resolution pertaining to acquisition by Oando of their interests in Gaslink; – Oando appoint an independent expert acceptable to the JSE to provide a fair and reasonable opinion on the related party transactions which opinion must be submitted and approved prior to the implementation of the scheme of arrangement; – Oando comply with the working capital requirements of the JSE; and – should any matter come to the attention of the JSE in addressing the above matters that in the opinion of the JSE warrant it, the JSE reserves it right to require a further shareholder meeting to approve the transaction prior to implementation of the scheme of arrangement. The scheme of arrangement involving Oando Marketing is an internal re-organisation and does not require JSE approval.
5. SALIENT DATES AND TIMES
2007 Last day to lodge forms of proxy for the Court ordered meetings by close of business Court ordered meetings to be held at 13h00 and 14h00, respectively Registration of special resolutions with the Registrar of Companies Results of Court ordered meetings released on SENS Results of Court ordered meetings published in the South African press Court to sanction schemes of arrangement Oando Marketing shares issued to Oando Listing of new Oando shares on the JSE Wednesday, 27 June Thursday, 28 June Friday, 29 June Friday, 29 June Monday, 2 July Wednesday, 4 July Thursday, 26 July Wednesday, 8 August
Notes: 1. These dates and times are subject to change. Any such change will be released on SENS and published in the South African press. 2. All dates and times referred to in this announcement are South African dates and times.
6. FINANCIAL EFFECTS AND CAUTIONARY ANNOUNCEMENT
Oando is currently working on the financial effects of the transaction and will make a further announcement setting out such financial effects in due course. Shareholders are advised to exercise caution when trading in their Oando shares until a further announcement is made in this regard.
Sponsor
Lagos 6 June 2007
Deutsche Securities
Member of the Deutsche Bank Group
doc_136576233.pdf
Announcement by Oando of the acquisition of minority interests in certain subsidiaries and the reorganization of its marketing business.
Proof 2 Bus Day and Beeld on the 08/06/07 size 38x7 Spell Check DC Angela Teeling-Smith 011 775 7301 011 775 7617 082 825 5167
ACQUISITION OF MINORITY INTERESTS IN CERTAIN SUBSIDIARIES, RE-ORGANISATION
OF MARKETING BUSINESS AND CAUTIONARY ANNOUNCEMENT
Oando Plc
1. INTRODUCTION
Shareholders are advised that Oando will be posting shareholder documentation on 7 June 2007 relating to proposals in terms of which Oando will: – acquire the interests Ocean and Oil Investments Limited (“OOI”), Oando’s major shareholder, in certain jointly held subsidiaries; – acquire the interests of certain minority shareholders in Gaslink Nigeria Limited (“Gaslink”). Shareholders are further advised that Oando will post shareholder documentation relating to an internal re-organisation of the Company’s downstream petroleum marketing business on or about 13 June 2007. Under Nigerian law the acquisitions and the internal re-organisation will be effected by way of two separate schemes of arrangement.
(Incorporated in Nigeria and registered as an external company in South Africa) Registration number: RC 6474 (External company registration number: 2005/038824/10) Share code on the JSE Limited: OAO Share code on the Nigerian Stock Exchange: UNTP ISIN: NG00000UNTP0 (“Oando” or “the Company”)
3. SCHEME OF ARRANGEMENT INVOLVING OANDO MARKETING LIMITED
3.1 Rationale and terms Oando’s downstream marketing unit, unlike its other lines of business, does not exist as a separate legal entity that is 100% owned by Oando. This limits Oando’s options for accessing the capital markets to raise capital for its marketing operations. Oando therefore wishes to undertake an internal re-organisation in terms of which it will transfer its downstream petroleum marketing business to a newly created legal entity, Oando Marketing Limited (“Oando Marketing”), in exchange for the entire issued share capital of Oando Marketing. Following implementation of the scheme of arrangement, Oando Marketing will commence business as a wholly-owned subsidiary of Oando. 3.2 Conditions precedent to the scheme of arrangement The scheme of arrangement is subject, inter alia, to the following conditions precedent: – the ratification, with or without modification, by the holders of Oando shares, which ratification shall be evidenced by a resolution of a majority representing (75%) in value of the votes exercisable by holders of Oando shares present and voting either in person or by proxy at a Court convened meeting; and – the Court sanctioning the scheme.
2. SCHEME OF ARRANGEMENT INVOLVING OOI AND GASLINK
2.1 Rationale The Board and management of Oando are committed to achieving world-class standards of corporate governance. To this end, the ownership structure and management of Oando’s subsidiaries was reviewed to identify areas in which conflicts of interest might arise. The following subsidiaries, which are 51% held by Oando and 49% held by OOI (save for Oando Production and Development Company Limited which is 39% held by OOI), Oando’s single largest shareholder with a 23.66% equity holding, were identified as having the potential to generate conflicts of interest: – Oando Supply and Trading Limited; – Oando Trading (Bermuda) Limited; – Oando Production and Development Company Limited; – Oando Energy Services Limited; and – Oando Exploration and Production Company Limited. Potential conflicts could arise for the following reasons: – OOI owns a direct equity stake in Oando as well as in the jointly held subsidiaries; – four directors of OOI sit on the board of Oando as well as the boards of the jointly held subsidiaries; and – Oando has management control of the jointly held subsidiaries and transacts a considerable amount of business with said subsidiaries. Accordingly, it is the view of the Board that, under the current structure OOI’s interests are not 100% aligned with the interests of Oando’s other shareholders as OOI disproportionately receives the benefits that arise out of business decisions pertaining to the jointly held subsidiaries where Oando and its other shareholders bear a disproportionate share of the associated costs. It has therefore been proposed that Oando acquire the entire equity holding of OOI in each of the jointly held subsidiaries such that upon conclusion of the scheme of arrangement such subsidiaries will be wholly owned by Oando. Similarly, Oando holds a 59.96% equity stake in Gaslink and has been in discussions with the other shareholders of Gaslink to acquire the entire issued share capital of Gaslink. Gaslink operates in a high margin sector of the energy spectrum and revenue from its operations will provide a diversified, increased and sustainable profitability for shareholders of Oando. Twelve of the minority shareholders have agreed to dispose of their equity stakes in Gaslink which will be acquired by Oando thereby increasing the Company’s equity holding in Gaslink to 98% on implementation of the scheme of arrangement. 2.2 Consideration Under the scheme of arrangement, it is proposed that that Oando acquire from OOI: – 2 450 000 ordinary shares of Naira 1.00 each in Oando Supply and Trading Limited in exchange for the issue of 9 102 864 ordinary shares of 50 kobo each in Oando (“Oando shares”); – 5 880 ordinary shares of US$1.00 each in Oando Trading (Bremuda) Limited in exchange for the issue of 33 671 408 Oando shares; – 4 410 000 ordinary shares of Naira 1.00 each in Oando Production and Development Company Limited in exchange for the issue of 42 350 579 Oando shares; – 2 450 000 ordinary shares of Naira 1.00 each in Oando Energy Services Limited in exchange for the issue of 6 998 870 Oando shares; and – 2 450 000 ordinary shares of Naira 1.00 each in Oando Exploration and Development Company Limited in exchange for the issue of 26 054 272 Oando shares. Pursuant to the scheme of arrangement OOI will hold approximately 34% of Oando’s enlarged issued share capital. In addition, Oando will acquire 635 916 333 ordinary shares of 50 kobo each from the twelve transacting minority shareholders of Gaslink in exchange for the issue of 63 591 633 Oando shares. Application for the listing of the additional ordinary shares will be made in due course. 2.3 Conditions precedent to the scheme of arrangement The scheme of arrangement is subject, inter alia, to the following conditions precedent: – the ratification, with or without modification, by the holders of Oando shares, which ratification shall be evidenced by a resolution of a majority representing (75%) in value of the votes exercisable by holders of Oando shares present and voting either in person or by proxy at a Court convened meeting; and – the Court sanctioning the scheme. 2.4 Other proposals At the Court convened meeting Oando shareholders will also be asked to approve: – an increase in the authorised share capital of Oando by the creation of 200 000 000 Oando shares; – amend the articles of association of Oando to reflect the increased authorised share capital; – amend the articles of association of Oando to enable the Company to receive consideration for the issuance of shares in either cash and/or valuable consideration, other than cash. Such resolutions will need to registered by the Registrar of Companies in South Africa in order to be effective.
4. REQUIREMENTS OF THE JSE LIMITED
Shareholders are advised that the documentation relating to the two schemes of arrangement have not been approved by the JSE Limited (“JSE”). At the time of the secondary listing of Oando on the JSE, Oando undertook to comply in full with the Listings Requirements of the JSE (“Listings Requirements”), save where such requirements are in direct contravention of the Companies and Allied Matters Act requirements or any associated legislation or regulation. The scheme of arrangement involving Oando and OOI and certain shareholders of Gaslink comprises transactions which require compliance with the Listings Requirements, as follows: – OOI holds 23.66% of the issued shares in Oando and is accordingly a related party to Oando; – one of the twelve transacting shareholders, Forte Properties and Investments Limited, holds 12.59% of Gaslink and is accordingly a related party to Oando; and – the consideration shares to be issued to OOI by Oando represent 20.65% of Oando’s current issued share capital and accordingly this portion of the transaction is a Category 2 transaction. Accordingly, the JSE has ruled that: – the scheme document relating to a scheme of arrangement involving Oando and OOI and certain shareholders of Gaslink must be submitted to the JSE for review prior to the scheme meeting; – the JSE may require Oando to post a supplementary circular to shareholders containing such additional Category 2 and related party information as it may deem necessary; – Oando remain under cautionary until pro forma financial statements together with a reporting accountants’ report thereon produced in accordance with the Listings Requirements has been submitted to the JSE and the financial effects have been published, which must occur prior to the scheme meeting; – OOI be precluded from voting on the resolution pertaining to the to the acquisition by Oando of OOI’s stake in the jointly held subsidiaries; – any Gaslink minority shareholders who are also shareholders of Oando be precluded from voting on the resolution pertaining to acquisition by Oando of their interests in Gaslink; – Oando appoint an independent expert acceptable to the JSE to provide a fair and reasonable opinion on the related party transactions which opinion must be submitted and approved prior to the implementation of the scheme of arrangement; – Oando comply with the working capital requirements of the JSE; and – should any matter come to the attention of the JSE in addressing the above matters that in the opinion of the JSE warrant it, the JSE reserves it right to require a further shareholder meeting to approve the transaction prior to implementation of the scheme of arrangement. The scheme of arrangement involving Oando Marketing is an internal re-organisation and does not require JSE approval.
5. SALIENT DATES AND TIMES
2007 Last day to lodge forms of proxy for the Court ordered meetings by close of business Court ordered meetings to be held at 13h00 and 14h00, respectively Registration of special resolutions with the Registrar of Companies Results of Court ordered meetings released on SENS Results of Court ordered meetings published in the South African press Court to sanction schemes of arrangement Oando Marketing shares issued to Oando Listing of new Oando shares on the JSE Wednesday, 27 June Thursday, 28 June Friday, 29 June Friday, 29 June Monday, 2 July Wednesday, 4 July Thursday, 26 July Wednesday, 8 August
Notes: 1. These dates and times are subject to change. Any such change will be released on SENS and published in the South African press. 2. All dates and times referred to in this announcement are South African dates and times.
6. FINANCIAL EFFECTS AND CAUTIONARY ANNOUNCEMENT
Oando is currently working on the financial effects of the transaction and will make a further announcement setting out such financial effects in due course. Shareholders are advised to exercise caution when trading in their Oando shares until a further announcement is made in this regard.
Sponsor
Lagos 6 June 2007
Deutsche Securities
Member of the Deutsche Bank Group
doc_136576233.pdf