ZAMBEEF | Investment Agreement with CDC Group plc, Refinancing of some of the Existing Debt and Settlement of the RCL Foods Put Options
ZAMBEEF PRODUCTS PLC
(“Zambeef” or the “Company”)
INCORPORATED IN THE REPUBLIC OF ZAMBIA
COMPANY REGISTRATION NUMBER: 31824
LuSE SHARE CODE: ZAMBEEF
Investment Agreement with CDC Group plc, Refinancing of some of the Existing Debt and Settlement of the RCL Foods Put Options
US$65 million fundraising through the issue of new Ordinary Shares and new Convertible Redeemable Preference Shares to CDC Group plc, utilised to settle the USD 23,385,604 of the RCL Foods Put Options and refinance USD 38,200,000 of the outstanding debt
Highlights of the Proposed Transaction:
- Issuance of 52,601,435 new Ordinary Shares at a subscription price of USD 0.18 (approximately ZMW1.85 as at 29 July 2016 using the Bloomberg spot rates) per Ordinary Share and 100,057,658 new Convertible Redeemable Preference Shares, which are convertible into new Ordinary Shares, subject to certain exceptions, at a price of USD 0.555 (approximately ZMW5.69 as at 29 July 2016 using the Bloomberg spot rates) per Convertible Redeemable Preference Share to CDC Group plc, will be raised, in aggregate, US$65 million.
- CDC is the UK’s development finance institution. It invests in promising businesses in Africa and South Asia with aim of supporting economic development to create jobs.
- In CDC, Zambeef has gained a constructive and supportive strategic shareholder, which will have a shareholding of approximately 17.5 per cent in Zambeef’s Ordinary Shares as enlarged by the issue of the new Ordinary Shares to CDC, and voting rights over approximately 34.85 per cent. of the Company’s share capital as enlarged by the issue of both the new Ordinary Shares and the Convertible Redeemable Preference Shares to CDC. Please refer to Clause 6.2 of this Announcement.
- Proceeds of the fundraising will be used as follows:
- to finance in cash the Company’s obligation to acquire RCL Foods’ shares in, and all claims whether on loan account or otherwise against Zamhatch pursuant to the Zamhatch Put Option up to an amount up to USD 9.1 million;
- to finance in cash the Company’s obligation to acquire RCL Foods’ shares in, and all claims whether on loan account or otherwise against Zam Chick pursuant to the Zam Chick Option up to an amount up to USD 14.3 million;
- to refinance USD 38.2 million of the outstanding debt of the Group; and
- to finance all costs and expenses, of approximately USD 3.4 million, incurred by the Company and CDC in connection with the Proposed Transaction.
- In addition, following completion of the Proposed Transaction, Zambeef will free up its internally generated cash flow in order to provide general working capital and to accelerate the roll out of the Company’s new Zambeef macro outlet stores, which were a key strategic priority of the Group during the last year.
The Company will shortly post a circular to Shareholders (the “Circular”), including a Notice of Extraordinary General Meeting, to convene the necessary extraordinary general meeting to approve resolutions relating to, inter alia, the Proposed Transaction. Once published, a copy of the Circular and Notice of Extraordinary General Meeting will be available to view on the Company’s website: http://184.108.40.206/
Completion of the Proposed Transaction is conditional on certain conditions precedent having been fulfilled (see paragraph 6.8 for further details).
Dr. Jacob Mwanza, Chairman of Zambeef Products plc commented:
“I am delighted that CDC is becoming a supportive long-term shareholder in Zambeef plc. We have a longstanding relationship with them and they have a long history of making successful investments in our Country, including plenty within the agricultural and food sectors.
Through the issue of these new shares we are able to finance the purchase of RCL Foods’ outstanding equity stakes in both Zamhatch and Zam Chick, refinance a significant amount of our debt, as well as provide additional working capital to accelerate the roll out of our new macro outlet stores.
This is a significant step forward for our Company and we are now in a stronger position than ever going forward. On behalf of the Board, I’d like to take this opportunity to thank CDC and all of our supportive shareholders and we look forward to delivering healthy shareholder returns over the years ahead. As per our interim announcement of 8 June 2016, the Board is pleased to report that the significant operational improvement and robust performance achieved in the first half has continued and we remain confident that we will meet market expectations for the full year and we look forward to updating the market on our progress over the coming months.”
The definitions that apply throughout this announcement can be found at the end of this announcement.
This announcement contains inside information.
For further information, please contact:
|Zambeef Products plc
Carl Irwin, Joint Chief Executive Officer
Francis Grogan, Joint Chief Executive Officer
|Tel: +260 (0) 211 369003|
|Pangaea Securities Limited (Sponsoring Broker & Financial Adviser)
|Tel: +260 (0) 211 220707|
The contents of the post above were obtained from third parties, which We, AfricanFinancials, believe to be reliable. However, We do not guarantee their accuracy and the above information may be in condensed form. The reader is encouraged to refer to the original source of the information, which, in most cases, is in PDF format and on the originating company's letterhead. While We endeavour to replicate the original content accurately, We cannot guarantee the absence of errors in the above article and We disclaim any liability regarding reliance on information provided in this article.
Zambeef Products Plc (ZAMB.zm)Share price: 2.59 Kwacha (0.00 | 0.00% – 02/06/23)
Recent Documents & News
Corporate announcement, Directorate changes
Zambeef Products Plc – Change in Directorate – April 21, 2023
Corporate announcement, Earnings
Zambeef Full Year 2022 Financial Results – December 6, 2022
AGM, Corporate announcement
Zambeef Products – Notice of 28th Annual General Meeting – December 6, 2022
Corporate announcement, Earnings
Zambeef Products releases its 2022 Annual Report – December 6, 2022
Zambeef Products Plc (ZAMB.zm) 2022 Annual Report – December 5, 2022