AEL: ALLIED ELECTRONICS CORPORATION LIMITED - Firm intention announcement relating to the demerger of Bytes Technology Group and withdrawal of cautionary
Firm intention announcement relating to the demerger of Bytes Technology Group and withdrawal of cautionary
ALLIED ELECTRONICS CORPORATION LIMITED
(Incorporated in the Republic of South Africa)
(Registration number: 1947/024583/06)
Share code: AEL
ISIN: ZAE000191342
("Altron" or "the Company")
NOT FOR DISTRIBUTION, PUBLICATION OR RELEASE, DIRECTLY OR INDIRECTLY, IN WHOLE OR
IN PART, IN, INTO OR WITHIN THE UNITED STATES OR ANY OTHER JURISDICTION IN WHICH
THE DISTRIBUTION, PUBLICATION OR RELEASE OF THIS ANNOUNCEMENT WOULD BE
UNLAWFUL.
FIRM INTENTION ANNOUNCEMENT RELATING TO THE DEMERGER OF BYTES TECHNOLOGY GROUP AND WITHDRAWAL OF CAUTIONARY
1 INTRODUCTION
Altron released cautionary announcements on SENS Thursday, 2 April 2020 and Thursday, 22 October
2020, advising that as part of its FY2020 strategic review the Altron board of directors ("Altron Board") had
assessed each of the business units within Altron, to identify opportunities which have the potential to create
value for Altron shareholders ("Altron Shareholders"). The Altron Board identified Bytes Technology Group
Limited (now named Bytes Technology Limited) ("Bytes UK") as not being ascribed fair value by the market.
In order to unlock value for Altron Shareholders the Altron Board resolved to apply for admi ssion of the
entire issued and to be issued share capital of Bytes UK, via a newly established holding company, Bytes
Technology Group plc, to the premium listing segment of the Official List of the United Kingdom ("UK")
Financial Conduct Authority ("FCA"), to trading on the Main Market of the London Stock Exchange ("LSE")
and to the Main Board of the Johannesburg Stock Exchange ("JSE") by way of a secondary inward listing,
to pursue an offer for subscription for new Bytes Technology Group plc shares, and a distribution of Altron´s
remaining interest in Bytes UK to ordinary Altron Shareholders ("Altron Ordinary Shareholders") (the
"Demerger").
Further to the cautionary announcement released on Thursday, 22 October ("Cautionary Announcement"),
Altron Shareholders are informed that Altron has entered into a share purchase agreement ("Demerger
SPA") with, amongst others, Bytes Technology Group plc in respect of the sale of all its shares in Bytes UK
to a wholly-owned subsidiary of Bytes Technology Group plc, and Bytes Technology Group plc is expected
to execute a convertible loan note instrument ("Convertible Loan Note Instrument") on 3 November 2020 in
respect of the unlisted, interest-free, unsecured, redeemable, convertible loan notes ("Convertible Notes")
to be issued to Altron as consideration for its shares in Bytes UK (together the "Transaction Agreements").
In terms of the Transaction Agreements Altron, through its subsidiary Bytes Technology Group Proprietary
Limited ("Bytes SA"), will dispose of Bytes UK to a wholly owned subsidiary of Bytes Technology Group plc
("Bytes Technology Holdco"). Altron will distribute the Convertible Notes it receives (through its various
subsidiaries) for the disposal of Bytes UK as a distribution in specie (subject to Altron retaining some
Convertible Notes to cover necessary costs and taxes arising from the Demerger) to Ordinary Altron
Shareholders.
The above will be implemented in accordance with the terms and conditions of the Transaction Agreements
as more fully set out in paragraph 6 below.
The purpose of this firm intention announcement ("FIA") is to, inter alia, advise Altron Ordinary Shareholders
of the terms, conditions and timing of the Demerger.
2 SALIENT TERMS OF THE DEMERGER
The Demerger anticipates the listing of Bytes UK, via a newly established holding company, Bytes
Technology Group plc, on the LSE and JSE with Altron Ordinary Shareholders retaining an interest in Bytes
UK pursuant to the composite, inter-conditional, indivisible transaction consisting of the Distribution, the
Offer, Admission, the Disposal, the Redemption and the Conversion as defined in section 6 below. The
diagram below provides a high-level overview of the Demerger steps.
SIMPLIFIED DEMERGER STRUCTURE
The Demerger structure diagram can be viewed in the pdf version of the announcement which will be
available on Altron´s website from today.
SIMPLIFIED DEMERGER STEPS
Simplistically the Demerger is being implemented through a three-step process:
Step 1: Altron sells Bytes UK to Bytes Technology Holdco, a wholly owned subsidiary of Byte s
Technology Group plc
o Altron sells its shares in Bytes UK to Bytes Technology Holdco, at market value (market value is
by reference to the Offer price ultimately achieved).
o Altron (through its various subsidiaries) receives Convertible Notes issued by Bytes Technology
Group plc in consideration for its shares in Bytes UK.
Step 2: Altron distributes Bytes Technology Group plc Convertible Notes
o Altron distributes Convertible Notes received in step 1 as a distribution in specie to Altron Ordinary
Shareholders, subject to Altron and Altron Finance Proprietary Limited, a wholly owned subsidiary
of Altron ("Altron Finance"), retaining some Convertible Notes to cover costs, taxes and settle a
portion of its loan obligations.
Step 3: Bytes Technology Group plc Offer
o Bytes Technology Group plc will apply for its shares to be admitted to the premium listing segment
of the Official List of the FCA and to trading on the Main Market of the LSE and on the Main Board
of the JSE by way of a secondary inward listing.
o Subject to fulfilment or waiver of certain conditions, including Admission (as defined below), Bytes
Technology Group plc will offer new shares to institutional investors in the UK and elsewhere (the
"Offer"), which shares will be issued to subscribers on Admission.
o Bytes Technology Group plc uses proceeds from the Offer to: i) redeem 100% of the Convertible
Notes beneficially owned by Altron and Altron Finance; and ii) redeem a minimum of 25% of the
Convertible Notes beneficially owned by Altron Ordinary Shareholders (excluding Convertible
Notes retained by Altron and Altron Finance as described in step 2, plus such number of such
Convertible Notes, up to 100%, as are the subject of Altron Ordinary Shareholder elections for
additional cash (in each case subject to investor demand in the Offer). Each Convertible Note which
is redeemed will be redeemed for cash at the Offer Price as defined in section 6 below.
o Remaining Convertible Notes held by Altron Ordinary Shareholders convert automatically into
Bytes Technology Group plc shares.
3 RATIONALE FOR THE DEMERGER
A fundamental and strategic goal of the Altron Board has been to maximise value for Altron Ordinary
Shareholders. This resulted in driving a strategy, which successfully delivered the disposal of non -core
assets, the rationalisation of operations and the execution of targeted acquisitions in high-growth areas.
This positioned Altron as a leading IT Services organisation in Africa and achieved a total shareholder
return of 26% per annum over three years with the return on capital employed increasing from 6.3% to
20.8% over the same period.
The Altron Board has assessed each of the business units within Altron, to identify opportunities which have
the potential to unlock further value for Altron Ordinary Shareholders and to streamline operations. Post
this review, the Altron Board concluded that the true value of Bytes UK is not reflected in the Company´s
share price. Bytes UK has increasingly developed a growth trajectory and strategic levers that are different
to the rest of the Altron group of companies ("Altron Group") and operates in a different geographical capital
market with a highly rated peer group. In addition, Bytes UK is independently managed by the Bytes UK
management team and has limited functional support from Altron.
Consequently, and after due consideration as to whether the long-term prospects of Bytes UK would be
enhanced by a separate listing on the LSE and secondary listing on the JSE, the Altron Board resolved to
pursue the Demerger. The Demerger will enable Bytes UK to operate in a more focused and efficient
manner, allow Bytes UK to achieve its strategic goals and unlock value for Altron Ordinary Shareholders
over the long term.
The Altron Board has carefully considered the unprecedented market conditions resulting from the Covid -
19 pandemic. The Altron Board believes that the terms and construct of the Demerger are still in the best
interests of Altron Shareholders and other Altron stakeholders.
4 DESCRIPTION OF ALTRON
Founded in 1965, Altron has a direct presence in South Africa, the rest of Africa, Europe, the Middle East
and Australia. In addition, the Altron Group´s strategic partnerships with leading international technology
companies gives it access to leading technology capabilities and products from across the world, including
Asia, Europe and North America.
Most of Altron´s revenue and headcount are derived from the local market in South Africa where the group
is headquartered. Altron´s primary focus is in providing innovative solutions in the fintech, healthtech, safety
& security, and learning and development verticals that have a meaningful impact on society by addressing
challenges facing communities in South Africa, the continent and beyond, while delivering shared value for
all its stakeholders.
5 DESCRIPTION OF BYTES TECHNOLOGY GROUP PLC
Bytes Technology Group plc is one of the UK's leading providers of IT software offerings and solutions, with
a focus on cloud and security products. Bytes Technology Group plc enables effective and cost-efficient
technology sourcing, adoption and management across software services, including in the areas of security
and cloud services. It aims to deliver the latest technology to a diverse and embedded customer base and
has a long track record of delivering strong financial performance.
Bytes Technology Group plc´s software offering includes working with customers to identify their software
needs, selecting and deploying appropriate software products, managing licence compliance and,
ultimately, seeking to optimise their software assets. This offering is delivered through licensing a nd
subscription agreements. The reselling of software in the form of licensing agreements, permits Bytes
Technology Group plc´s customers to install the software on a specified number of IT devices, such as
desktop computers, mobile devices or servers. Software is also delivered through the cloud in the form of
subscription agreements that allow access to the software for a specified number of users over a period of
time, which is known as Software-as-a-Service. Examples include Microsoft Azure and Microsoft 365.
Beyond the reselling of software, Bytes Technology Group plc provides tailored IT solutions to its
customers, including the products and services required to implement and manage such solutions. Thes e
solutions, which are provided both on premise and in the cloud, include professional and managed services
as well as hardware sales.
6 DETAILS OF THE DEMERGER
Altron expects that the Demerger will be implemented in accordance with the following transaction steps:
6.1 As at 2 November 2020, Bytes SA, an indirect wholly owned subsidiary of Altron, owns the 10,000 A
ordinary shares in Bytes UK and Bytes UK management own the 1,000 B ordinary shares in Bytes
UK;
6.2 Altron, through Bytes SA, will dispose of all of its interest in Bytes UK (the "Disposal") to Bytes
Technology Holdco, a wholly owned subsidiary of Bytes Technology Group plc, with Bytes
Technology Group plc being subject to the listing as described in the Introduction above;
6.3 management of Bytes UK will also sell their interest in Bytes UK to Bytes Technology Group plc,
such that the Bytes Technology Group plc group of companies will own the entire issued share capital
of Bytes UK with effect from Admission (as defined below). Bytes UK management will receive Bytes
Technology Group plc shares equal to 5% of the issued share capital of Bytes Technology Group plc
at Admission and £14.3 million cash consideration in consideration for their interest in Bytes UK;
6.4 the initial shareholders of Bytes Technology Group plc are Neil Murphy and Keith Richardson, the
Chief Executive Officer and Chief Financial Officer, respectively, of Bytes Technology Group plc;
6.5 Bytes Technology Group plc on behalf of Bytes Technology Holdco will settle the purchase
consideration due to Bytes SA for the Disposal through the issue of 220,506,494 Convertible Notes
to Bytes SA;
6.6 Bytes SA and certain intermediate subsidiaries of the Company will distribute the Convertible Notes
to Altron as a distribution in specie in terms of section 46 of the Companies Act. Altron will in turn
distribute the beneficial interest in 91% of the Convertible Notes (representing 200,600,910
Convertible Notes) to Altron Ordinary Shareholders by way of a distribution in specie in terms of
section 46 of the Companies Act ("Distribution"). Altron will retain 9% of the Convertible Notes
(representing 19,905,584 Convertible Notes) in order to settle dividends tax arising from the
Distribution. Altron has estimated that the proceeds of the redemption of 9% of the Convertible Notes
will be sufficient to settle dividends tax, however, the actual liability for dividends tax will be
determined after Altron Ordinary Shareholders submit declarations to Altron in terms of section 64FA
of the Income Tax Act;
6.7 Altron Shareholders, who are on the Altron register at the record date for the Distribution (see
paragraph 15 below), will be entitled to 0.5 Convertible Notes for every 1 Altron ordinary share held
("Entitlement Ratio");
6.8 Certain of the Convertible Notes will be redeemed for cash out of the proceeds raised in the Offer
("Redemption") and any Convertible Notes not redeemed shall automatically convert into shares in
Bytes Technology Group plc ("Conversion");
6.9 Altron Finance which holds treasury shares in the Company equal to 8%, and Altron Shareholders
in jurisdictions in which it is unlawful to deliver shares in Bytes Technology Group plc ("Restricted
Shareholders") will have 100% of their Convertible Notes redeemed for cash at the price per Bytes
Technology Group plc share realised in the Offer ("Offer Price");
6.10 Altron will use the redemption proceeds received through Altron Finance in step 6.9 above to reduce
Altron Group debt;
6.11 Altron will have 100% of the 9% of the Convertible Notes which it retained redeemed for cash at the
Offer Price so that it can settle the dividends tax obligation arising on the Distribution;
6.12 after redemption of the Convertible Notes retained by Altron to settle its dividends tax and held by
Altron Finance and Restricted Shareholders, subject to demand in the Offer for approximately 37%
of the enlarged share capital of Bytes Technology Group plc, Altron Ordinary Shareholders who do
not make an election will have 25% of their Convertible Notes redeemed for cash at the Offer Price
per Convertible Note and the remaining 75% of their Convertible Notes will be automatically
converted into Bytes Technology Group plc shares (the "Default Ratio");
6.13 to the extent there is insufficient demand for Bytes Technology Group plc shares in the Offer to
redeem Convertible Notes in the Default Ratio, the Default Ratio will be adjusted proportionately;
6.14 Altron Shareholders who wish to have more than 25% of their Convertible Notes redeemed for cash
may submit an election (by the election date, see paragraph 15 below) to do so, and such elections
will be satisfied proportionally to the extent of investor demand for Bytes Technology Group plc
shares in the Offer in excess of the demand required to redeem Convertible Notes in the Default
Ratio;
6.15 the Bytes Technology Group plc shares will be admitted to the premium listing segment of the Official
List of the FCA and to trading on the LSE's Main Market for listed securities and to the Main Board
of the JSE by way of a secondary inward listing ("Admission"); and
6.16 all underwriting commissions, fees, expenses and taxes payable in respect of the Offer and the issue
of the new Bytes Technology Group plc shares will be borne by Bytes Technology Group plc. The
Offer will therefore also raise sufficient funds for Bytes Technology Group plc to enable it to satisfy
the above obligations.
Altron is satisfied that Bytes Technology Group plc has sufficient authority available to be able to issue the
Convertible Notes to Bytes SA and to be able to issue to Altron as nominee for Altron Ordinary
Shareholders´ the converted Bytes Technology Group plc shares arising on Conversion of the Convertible
Notes.
7 CONSIDERATION PAYABLE TO ALTRON AND ALTRON SHAREHOLDERS
In order to provide additional certainty in relation to the Demerger as described above the Altron Board has
determined a minimum Offer Price of £1.89 below which the Demerger will not be implemented ("Minimum
Offer Price"). It has been set by reference to the currently prevailing global macroeconomic and stock
market volatility. As such, it should not be taken as a guide to the actual Offer Price which may be achieved
and/or the Altron Board's assessment of the actual value of Bytes UK. The Altron Board are entitled in their
absolute discretion to increase the Minimum Offer Price until the publication of the prospectus, which is
expected to be published on 2 December 2020. When assessing whether to increase the Minimum Offer
Price, the Altron Board will take all relevant factors at that time into consideration in exercising their fiduciary
duties The Minimum Offer Price has been put in place to ensure the Demerger will only be implemented on
terms which create value for Altron Shareholders.
The Minimum Offer Price will result in a minimum market capitalisation of £450 million for Bytes Technology
Group plc at Admission. This represents 89% of Altron´s current market capitalisation as at close of
business on 30 October 2020.
Based on the Minimum Offer Price Altron will receive a minimum value of c.£416 million (220,506,494
Convertible Notes multiplied by £1.89) in proceeds from the Disposal. Post dividends tax Altron will
distribute c.£379 million (200,600,910 Convertible Notes multiplied by £1.89) in value to Altron Ordinary
Shareholders in the form of Bytes Technology Group plc shares and cash.
As an illustrative example, post implementation of the Demerger Altron Ordinary Shareholders (other than
Restricted Altron Shareholders and Altron Finance) are expected to receive the following on the basis that
the Default Ratio is 75%:25%:
for every 8 Altron ordinary shares
3 Bytes Technology Group plc shares and cash to the value of 1 Bytes Technology Group plc share at
the Offer Price
This represents a value equivalent to not less than GBP0.94/ZAR20.03 per Altron ordinary share at the
Minimum Offer Price (representing, as a minimum, approximately 75% of the current market value of an
Altron ordinary share as at 30 October 2020).
Altron Ordinary Shareholders (excluding Restricted Altron Shareholders and Altron Finance) will have the
option to elect to receive a greater percentage of this value in cash.
The Default Ratio of 75%:25% referred to above and the ability to elect to receive a greater percentage of
the value in cash will be dependent on there being sufficient demand in the Offer.
8 FUNDING THE TRANSACTION
The Takeover Regulations Panel ("TRP") has been furnished with an irrevocable unconditional guarant ee
issued by Rand Merchant Bank, a division of FirstRand Bank Limited ("RMB"), in accordance with regulation
111(4)(a) of the Companies Regulations, in which RMB has agreed to pay up to a maximum guaranteed
amount equal to the Rand equivalent of GBP97,300,000, in relation to:
o the redemption of 100% of the Convertible Notes held by Altron as nominee for Restricted Altron
Shareholders;
o the redemption of 25% of the Convertible Notes held by Altron as nominee for Altron Ordinary
Shareholders (other than Altron Finance and Restricted Altron Shareholders); and
o settlement of fractional entitlements of Altron ordinary shares to Convertible Notes,
if Bytes Technology Group plc fails to pay such amounts to Altron, subject to fulfilment or, where applicable,
waiver of the suspensive conditions
9 SHAREHOLDER APPROVALS REQUIRED
In connection with the Demerger, Altron is expected to publish a circular on Tuesday, 3 November 2020
setting out the detailed terms of the Demerger ("Altron Circular") and to convene an extraordinary general
meeting of the Altron Shareholders ("General Meeting") at which the Altron Shareholders will be asked to
consider, and, if deemed fit, pass the following resolutions required to implement the Demerger:
9.1 approval by special resolution of the Altron Shareholders in accordance with section 112 and
115(2)(a) of the Companies Act for the Distribution ("Distribution Resolution");
9.2 approval by special resolution of the Altron Shareholders in accordance with section 112 and
115(2)(b) of the Companies Act for the Disposal ("Disposal Resolution"); and
9.3 approval by more than 50% of the total voting rights exercised by Altron Shareholders for the
Disposal as it is a Category 1 Transaction in terms of the JSE Listings Requirements,
(collectively, the "Demerger Resolutions")
10 SUSPENSIVE CONDITIONS TO THE DEMERGER
The Demerger is subject to fulfilment or waiver by Altron, where capable of waiver, of the following
suspensive conditions by no later than 31 December 2020:
10.1 delivery by KPMG Services Proprietary Limited ("Independent Expert") of the Independent Expert´s
Report (as defined below) to the Altron independent board ("Independent Board");
10.2 the adoption of the Demerger Resolutions at the General Meeting;
10.3 either:
10.3.1 fewer than 15% of the voting rights exercised on the Disposal Resolution and the Distribution
Resolution are exercised against such resolutions; or
10.3.2 if 15% or more of the voting rights exercised on the Disposal Resolution or the Distribution
Resolution are exercised against either such resolution:
10.3.2.1 within the 5 business day period referred to in section 115(3)(a) of the Companies Act, no
Altron Shareholder who voted against the Disposal Resolution or the Distribution
Resolution requires Altron to seek the approval of the court in terms of section 115(3)(a) of
the Companies Act; or
10.3.2.2 if any Altron Shareholder who voted against the Disposal Resolution or the Distribution
Resolution requires Altron to seek the approval of the court in terms of section 115(3)(a) of
the Companies Act, court approval is obtained;
10.4 either:
10.4.1 within the 10 business day period referred to in section 115(3)(b) of the Companies Act, no
Altron Shareholder who voted against the Disposal Resolution or the Distribution Resolution
seeks leave of the court in terms of section 115(3)(b) of the Companies Act for a review of the
Disposal or the Distribution; or
10.4.2 if any Altron Shareholder who voted against the Disposal Resolution or the Distribution
Resolution seeks leave of the court in terms of section 115(3)(b) of the Companies Act for a
review of the Disposal and/or the Distribution, then:
10.4.2.1 the court determines that it will not grant such leave; or
10.4.2.2 if the court does grant such leave, the court determines that the Disposal Resolution and
the Distribution Resolution will not be set aside;
10.5 if any Altron Shareholders exercise the rights afforded to them in terms of section 164 of the
Companies Act ("Appraisal Rights"), Altron Shareholders holding no more than 5% of all the Altron
ordinary shares exercise their Appraisal Rights, by delivering valid demands, as contemplated in
sections 164(5) to 164(8) of the Companies Act, within the maximum time period specified in the
Companies Act, provided that in the event that either:
10.5.1 Altron Shareholders deliver notices objecting to the Disposal Resolution or the Distribution
Resolution as contemplated in section 164(3) of the Companies Act, in respect of no more
than 5% of the Altron ordinary shares; or
10.5.2 Altron Shareholders who have delivered notices in terms of section 164(3) of the Companies
Act exercise voting rights against the Disposal Resolution and the Distribution Resolution in
respect of no more than 5% of the Altron Ordinary Shares,
this suspensive condition shall be fulfilled immediately following the General Meeting;
10.6 approval by the Financial Surveillance Department of the South African Reserve Bank ("FinSurv") for
the Demerger in terms of the Exchange Control Regulations, 1961, issued pursuant to the South
African Currency and Exchanges Act, 1933 (including any applicable directive and rulings of FinSurv
and the South African National Treasury);
10.7 to the extent that their approval is required in terms of the common terms agreement entered into
between, amongst others, Altron, Bytes UK and Nedbank Limited (as facility agent) dated 28
February 2019, Altron´s lenders give their written approval (on terms acceptable to Altron, acting
reasonably) for the Disposal and the Distribution;
10.8 the release by Altron´s lenders of security over the shares and other assets in or of any members of
the Bytes Technology Group plc group of companies (including shares in Bytes UK) with effect from
Admission;
10.9 the bookrunner procures subscribers for not less than 25% of the expected enlarged issued share
capital of Bytes Technology Group plc immediately following Admission (as determined by Bytes
Technology Group plc, acting reasonably) at a subscription price per Bytes Technology Group plc
share not less than the Minimum Offer Price;
10.10 the underwriting agreement is entered into and becomes unconditional in accordance with its terms;
10.11 the issue by the TRP of Compliance Certificates in relation to the Distribution in terms of section
115(1)(a) and (b) (read with section 119(4)(b) of the Companies Act) by 2 December 2020;
10.12 the issue by the TRP of a Compliance Certificate in relation to the Disposal in terms of section
115(1)(a) and (b) (read with section 119(4)(b) of the Companies Act) between the record date and
the Admission date; and
10.13 Admission occurring.
11 PRO FORMA FINANCIAL EFFECTS ON ALTRON
The pro forma financial effects presented below have been prepared for illustrative purposes only to provide
information about how the Demerger may have affected the financial position of Altron assuming that the
Demerger had been implemented on 31 August 2020 for purposes of the net asset value per share and
tangible net asset value per share and implemented on 1 March 2020 for purposes of the earnings per
share and headline earnings per share.
Pro forma
after the
Pro forma financial effects (cents) Before (1) Demerger (2) Change %
Earnings per share ("EPS")2.1 69 2,551 3,611%
Continuing operations 85 2,567 2,919%
Discontinued operations (16) (16) 0%
Headline earnings per share ("HEPS")2.1 67 (22) (133%)
Continuing operations 83 (6) (107%)
Discontinued operations (16) (16) 0%
Net asset value per share 2.2 1,101 1,197 9%
Net tangible asset value per share 2.2 467 782 68%
Number of shares (`000s) 369,034 369,034
Weighted average number of shares (`000s) 373,897 373,897
NOTES
(1) The "Before" column has been extracted from Altron's unaudited interim financial
statements for the six months ended 31 August 2020.
(2) The "Pro forma after the Demerger" column reflects the impact of the Disposal and
Distribution of Bytes UK as follows:
(2.1) Pro forma earnings and headline earnings per share are based on the principal
assumption that the Disposal and Distribution were effective 1 March 2020.
(2.2) Pro forma net asset value and net tangible asset value per share are based on
the principal assumption that the Disposal and Distribution were effective 31
August 2020.
(3) Although there is current significant uncertainty regarding the implications of the global
COVID-19 pandemic, no post balance sheet event has been adjusted for in this regard.
There are no other material subsequent events that require an adjustment to the pro
forma financial information.
12 INDEPENDENT BOARD
The Independent Board has been constituted in terms of the Companies Act to consider the terms of the
Disposal and the Distribution.
13 INDEPENDENT EXPERT AND FAIR AND REASONABLE OPINION
13.1 The Independent Board has appointed the Independent Expert, as required by section 112 of the
Companies Act (read with Regulation 90 of the Companies Regulations), to issue an opinion in
respect of the Disposal and the Distribution in accordance with regulations 90 and 110 of Companies
Regulations, issued in terms of section 223 of the Companies Act, and to express an opinion on
whether the Disposal and the Distribution are fair and reasonable to Altron Shareholders
("Independent Expert Report"). The Independent Expert's Report will be detailed in the Altron
Circular.
13.2 Having considered the terms and conditions of the Disposal and Distribution and based on the
conditions set out in the Independent Expert´s Report on the Disposal and Distribution, the
Independent Expert has concluded that the terms and conditions of the Disposal and Distribution are
both fair and reasonable to Altron Shareholders, as each of these terms is defined in the Companies
Act.
14 DOCUMENTATION
Details of the Demerger will be included in the Altron Circular, which will contain, inter alia, the terms of the
Demerger, a notice convening the General Meeting, a form of proxy in connection with the General Meeting,
and the relevant tax declaration and undertaking forms with respect to the dividend liability created in the
hands of Altron per section 64FA of the Income Tax Act. It is expected the Altron Circular will be posted on
Tuesday, 3 November 2020.
15 IMPORTANT DATES AND TIMES
2020
Record date to determine which Altron Shareholders are entitled to Friday, 23 October
receive the Altron Circular and notice of General Meeting
Circular posted to Altron Shareholders and notice convening the General Tuesday, 3 November
Meeting released on SENS on
Last day to trade in order to be eligible to attend and vote at the General Wednesday 18 November
Meeting
Declaration announcement in respect of the Distribution released on Friday, 20 November
SENS
Record date for the voting at the General Meeting Monday, 23 November
General Meeting at 10:00am Tuesday, 1 December
Results of General Meeting released on SENS on Tuesday, 1 December
Finalisation announcement in respect of the Distribution released on Wednesday, 2 December
SENS on
Announcement released on SENS in respect of cash payment for Wednesday, 2 December
fractional entitlements
If the Disposal and Distribution are approved by Altron Shareholders at the General Meeting and
the suspensive conditions are fulfilled or waived (where capable of waiver):
The following dates assume that no court approval or review of the Disposal or the Distribution is
required:
Last day to trade in Altron Ordinary Shares in order to be eligible to receive Friday, 4 December
the Distribution
Altron Ordinary Shares trade ex the entitlement to receive the Distribution Monday, 7 December
on
Record date for the Distribution Wednesday, 9 December
Distribution election date Wednesday, 9 December
Settlement date for the Distribution (Altron to hold Convertible Notes as Thursday, 10 December
nominee for Altron Ordinary Shareholders)
Admission of the Bytes Technology Group plc shares to the LSE and Friday, 17 December
commencement of unconditional dealings in Bytes Technology Group plc
shares on the LSE at 8:00 (London time) on
Admission of the Bytes Technology Group plc shares to the JSE and Friday, 17 December
commencement of unconditional dealings in Bytes Technology Group plc
shares on the JSE at 10:00 on5
Settlement for Conversion of Convertible Notes Friday, 17 December
Payment date for Redemption of Convertible Notes Thursday, 23 December
Fractional entitlement payment date Thursday, 23 December
The following dates assume that court approval or review of the Disposal and Distribution is
required:
Last day for Altron Shareholders who voted against the Disposal and/or 5 business days after the
the Distribution to require Altron to seek court approval for the Disposal General Meeting, currently
and/or the Distribution in terms of section 115(3)(a) of the Companies Act, anticipated to be Tuesday, 8
if at least 15% of the total votes of Altron Shareholders at the General December
Meeting were exercised against the Disposal and the Distribution on
Last day for Altron Shareholders who voted against the Disposal and/or 10 business days after the
the Distribution to apply to the court for a review of the Disposal and/or General Meeting, currently
the Distribution in terms of section 115(3)(b) of the Companies Act on anticipated to be Tuesday,
15 December
Notes:
1. All times shown in this FIA are South African Standard Time unless otherwise stated.
2. All dates and times are subject to change by Altron (subject to the approval of the JSE and/or TRP, if
required). Any material change will be released on SENS and published in the South African press.
3. Altron ordinary share certificates may not be rematerialised or dematerialised between Monday, 7
December 2020 and Wednesday, 9 December 2020, both days inclusive.
4. The dates have been determined based on certain assumptions regarding the dates by which certain
Altron Shareholder and regulatory approvals will be obtained and that no court approval or review of
the Disposal and / or Distribution will be required. If the relevant dates change and the dates set out
above are therefore impacted, details of the relevant change will be released on SENS and published
in the South African press.
5. Admission of the Bytes Technology Group plc shares to the JSE and commencement of unconditional
dealings in Bytes Technology Group plc shares on the JSE will commence at 10:00am instead of
9:00am in order to align with the admission time on the LSE and facilitate a simultaneous listing on both
exchanges.
16 BYTES TECHNOLOGY GROUP PLC RESPONSIBILITY STATEMENT
The board of directors of Bytes Technology Group plc, individually and collectively accepts full responsibility
for the accuracy of the information contained in this FIA to the extent that it relates solely to Bytes
Technology Group plc. In addition, the board of directors of Bytes Technology Group plc certifies that to the
best of its knowledge and belief, the information contained in this FIA solely pertaining to Bytes Technology
Group plc is true and, where appropriate, does not omit anything that is likely to affect the importance of
the information contained herein solely pertaining to Bytes Technology Group plc, and that all reasonable
enquiries to ascertain such information have been made.
17 INDEPENDENT BOARD RESPONSIBILITY STATEMENT
The Independent Board, individually and collectively, accepts full responsibility for the accuracy of the
information contained in this FIA to the extent that it relates to Altron. In addition, the Independent Board
certifies that to the best of its knowledge and belief, the information contained in this FIA is true and, where
appropriate, does not omit anything that is likely to affect the importance of the information contained herein
pertaining to Altron, and that all reasonable enquiries to ascertain such information have been made.
18 WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT
The Cautionary Announcement is hereby withdrawn, and caution is no longer required to be exercised by
Altron Shareholders when dealing in their Altron ordinary shares.
Johannesburg
2 November 2020
Financial Advisor and Transaction Sponsor
Rand Merchant Bank, a division of FirstRand Bank Limited
Legal advisor to Altron
DLA Piper
Independent Expert to Altron
KPMG
Legal advisor to Bytes Technology Group plc
Travers Smith LLP
IMPORTANT NOTICE
This announcement is an advertisement and does not constitute a prospectus in connection with an offering
of securities. These materials may not be published, distributed or transmitted by any means or media,
directly or indirectly, in whole or in part, in, into or within the United States. These materials do not constitute
an offer to sell, or a solicitation of an offer to buy, securities in the United States. Securities may not be
offered or sold in the United States absent (i) registration under the U.S. Securities Act of 1933, as amended
(the "Securities Act"), or (ii) an available exemption from registration under the Securities Act. The securities
mentioned herein have not been, and will not be, registered under the Securities Act and will not be offered
to the public in the United States.
The announcement does not constitute an offer for the sale of or subscription for, or the solicitation of an
offer to buy and subscribe for, securities to the public as defined in the South African Companies Act,
2008 (the "SA Companies Act") and will not be distributed to any person in South Africa in any manner
which could be construed as an offer to the public in terms of Chapter 4 of the SA Companies Act. These
materials do not, nor are they intended to, constitute a prospectus prepared and registered under t he SA
Companies Act. Nothing in these materials should be viewed, or construed, as "advice" as that term is
used in the Financial Markets Act, 2012 and/or the Financial Advisory and Intermediary Services Act,
2001.
This announcement and any offer if subsequently made is and will only be addressed to and is and will
only be directed at persons in South Africa who fall within one of the categories listed in section 96(1)(a)
and/or (b) of the SA Companies Act.
This announcement may include statements that are, or may be deemed to be, "forward-looking
statements". These forward-looking statements may be identified by the use of forward-looking
terminology, including the terms "believes", "estimates", "plans", "projects", "anticipates", "expects",
"intends", "may", "will" or "should" or, in each case, their negative or other variations or comparable
terminology, or by discussions of strategy, plans, objectives, goals, future events or intentions. Forward -
looking statements may and often do differ materially from actual results. Any forward-looking statements
reflect the Bytes Technology Group plc's current view with respect to future events and are subject to
risks relating to future events and other risks, uncertainties and assumptions relating to the Bytes
Technology Group plc's business, results of operations, financial position, liquidity, prospects, growth and
strategies. Forward-looking statements speak only as of the date they are made. No representation or
warranty is made that any forward-looking statement will come to pass.
Date: 02-11-2020 05:17:00
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
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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.
