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| BEE transaction
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Reunert announced a R1,1 billion plan to introduce black economic empowerment shareholders into the business. A broad based BEE Educational Trust and the founders of Peotona Group Holdings will benefit from this deal. In addition 100 Reunert shares each will be given to the majority of Reunert employees. In total the BEE shareholding will represent about 9,5% of Reunert’s shares in issue.
The four founding members of Peotona Group are Cheryl Carolus, Dolly Mokgatle, Thandi Orleyn and Wendy Lucas-Bull. They will participate in 30% of the planned transaction. The remaining 70% of shares will vest in a BEE trust for the benefit of a broad body of previously disadvantaged individuals.
“Reunert realises how critical quality education in mathematics and science is for its own future as well as that of South Africa,” says Reunert chief executive Gerrit Pretorius. “We regard it as essential to develop young people enabling them to participate in the economic development of our country.”
The trust will work with the Reunert College, an existing initiative that Reunert started in 1993. More than 500 students have been assisted by the Reunert College to prepare them for tertiary education, mainly in the hard sciences. In addition, over 400 bursaries have been awarded to students to obtain a tertiary qualification.
“The Educational Trust can now be broadened and we hope to grow the number of students helped each year,” says Pretorius.
In a second transaction Reunert employees who are not participants of a share option scheme will also benefit. Nearly 6 000 Reunert employees will receive 100 Reunert shares each at no cost to them. This will cost Reunert R33 million after tax. The shares are subject to a five year holding period, but employees will receive dividends from date of issue.
“The grant to employees is in recognition of their contribution to where Reunert is today. It is a relatively small token of our appreciation,” Pretorius said.
Cheryl Carolus, chairman of Peotona Group said, “We are extremely proud to be part of this partnership with Reunert. The Educational Trust will provide, in the long term, very substantial and sustainable support to develop young people in our country. We look forward to working with Reunert to build on the success of the Reunert College and combine the objectives of the Educational Trust with the development focus of Peotona Development.”
Reunert plans to sell its wholly owned subsidiary Bargenel Investments Limited to a special purpose vehicle incorporated for purposes of the BEE transaction. Bargenel will hold 18,5 million Reunert shares which were bought back over the past few years and has since been held as treasury shares. The price per share used for the calculations is R60,13 per share. This represents the volume weighted average Reunert share price between 1 and 16 August 2006 and amounts to R66,81 per share, less a 10% discount.
The above transactions are conditional on approval by the majority of Reunert’s shareholders and will be voted on at the company’s annual general meeting to be held on 6 February next year.
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For more information contact
Carina de Klerk
Tel 011 517 9035
Mobile 083 631 5743
e-mail carina@reunert.co.za |
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