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Revised terms announcement regarding the disposal of Activo and its subsidiaries
AFROCENTRIC INVESTMENT CORPORATION LIMITED
(Incorporated in the Republic of South Africa)
(Registration number: 1988/000570/06)
ISIN: ZAE000078416
JSE share code: ACT
("AfroCentric", together with
its subsidiaries, the "AfroCentric Group")
REVISED TERMS ANNOUNCEMENT REGARDING THE DISPOSAL OF ACTIVO AND ITS SUBSIDIARIES
Unless otherwise defined herein, defined terms used in this announcement have the meanings attributed to them in the
announcement released on the Stock Exchange News Service ("SENS") on 24 December 2025.
1. INTRODUCTION
1.1. Shareholders are referred to the announcement released on SENS on 24 December 2025 in which they
were advised that ACT HA, a wholly owned subsidiary of AfroCentric, had entered into a sale and purchase
agreement ("SPA") with FHC Group and FHC in terms of which ACT HA had agreed to dispose of its entire
shareholding in and all Sale Claims against its wholly-owned subsidiary Activo (and, indirectly, Activo's
wholly owned subsidiaries AHA and Forrester), (together the "Activo Group"), for the Disposal
Consideration ("Original Transaction").
1.2. In light of the announcement released on SENS on 29 January 2026, regarding the outcome of the Request
for Proposal process initiated by Bonitas Medical Aid Fund and the potential impact on the trading position
of the Activo Group, the parties have agreed to revise the terms of the Original Transaction ("Revised
Terms"). Accordingly, Shareholders are hereby advised that the Original Transaction has been replaced by
the Revised Terms outlined in this announcement.
1.3. Shareholders are hereby advised that, to give effect to the Revised Terms, on 23 April 2026: (i) ACT HA
entered into a new sale and purchase agreement ("Revised SPA") with FHC Group and FHC in terms of
which ACT HA will dispose of its entire shareholding in its wholly-owned subsidiary Activo; and (ii) ACT HA,
AfroCentric Health (RF) Proprietary Limited ("AHL") and Activo entered into a cession agreement ("Cession
Agreement") with FHC Group and FHC in terms of which AHL will dispose of all Sale Claims against Activo,
to FHC on the Revised Terms disclosed in paragraph 4 below ("Disposal") (the shareholding and the Sale
Claims together, the "Disposal Assets").
1.4. The Disposal will be subject to the fulfilment or waiver of the Conditions (as described in paragraph 4.2).
2. INFORMATION REGARDING ACTIVO AND FHC
2.1. Activo
2.1.1. Activo operates both as a registered pharmaceutical trading entity and as a holding company for
AHA and Forrester. It largely operates within South Africa.
2.1.2. Activo along with its subsidiaries owns the registered marketing rights and dossiers to manufacture
and distribute specific generic medicines across a broad therapeutic range, including chronic
medication, ARVs, ointments and hospital products. Its offering also includes over-the-counter
products, complementary medicines and medical devices.
2.1.3. The value of net assets attributable to the Disposal Assets as at 31 December 2025 was
R474 million. Activo has been classified as a discontinued operation, and the consolidated profit
attributable thereto for the financial year ending 31 December 2025 was R11 million.
2.1.4. The values attributable to the net assets and the profits thereto have been extracted from
AfroCentric's annual financial statements for the year ended 31 December 2025. The attributable
profit has been extracted from Activo's draft financial statements for the year ended 31 December
2025, which are prepared in accordance with the International Financial Reporting Standards
(IFRS).
2.1.5. More information pertaining to Activo is available on AfroCentric's and Activo's respective websites
at https://www.afrocentric.za.com/ and https://activo.co.za/, including AfroCentric's annual financial
statements and annual integrated report for the year ended 31 December 2025.
2.2. FHC
2.2.1. FHC is a wholly owned subsidiary of FHC Group, a leading Portuguese pharmaceutical group
founded in 1998 and privately held and owned by veterans in the pharmaceutical industry in
Portugal, Joaquim Chaves and Luis Pedro Simoes, each of whom hold 50% of the issued shares
in FHC Group.
2.2.2. FHC Group operates across the full pharmaceutical value chain, from manufacturing to distribution.
It has recognised expertise in the industrial area, distribution in the ambulatory and hospital
markets, exports, R&D in health and information technologies. Through subsidiaries such as
Laboratórios Basi, it maintains a strong manufacturing base.
2.2.3. FHC Group is present in 65 countries on 4 continents, including Africa where it has ambitions to
grow its presence and client offering through organic and inorganic growth opportunities. FHC
Group is committed to advancing access, efficiency, and innovation in healthcare delivery in all
markets it operates in.
3. RATIONALE FOR THE DISPOSAL
The pharma-cluster has been an important and growing part of the AfroCentric Group over the years,
complementing AfroCentric's wide range of healthcare products and services to both private and public sectors.
After careful consideration, AfroCentric commenced a strategic review process of the group's operations which led
to the decision to dispose of the pharmaceutical manufacturing and marketing division to a strategic owner with
deep expertise in the pharmaceutical market. The rationale for the Disposal is as follows:
3.1. A refined strategy focused on health administration, managed care, and corporate solutions: The
AfroCentric Group will focus on its key areas of strength in health administration, managed care and
corporate solutions that leverage a similar skillset and have significant opportunities for shared value
creation.
3.2. Strengthening of the AfroCentric Group balance sheet: The proceeds from the Disposal will enable
AfroCentric to deleverage its balance sheet to improve operational sustainability by reducing financing costs
due to the reduced debt.
3.3. Realisation of value from non-core assets: The Disposal provides AfroCentric with a liquidity event to
realise value for assets that are no longer core to the business. Shareholders could further benefit from the
improved strategic focus of the remaining AfroCentric Group. The Disposal and subsequent deleveraging
will free-up management capacity to focus on growth in the priority sectors to drive value for Shareholders.
4. SALIENT TERMS OF THE DISPOSAL
The salient terms and conditions of the Disposal, and other salient information pertaining to the Disposal, are set
out below.
4.1. Disposal Consideration
4.1.1. In terms of the Revised SPA and the Cession Agreement, the consideration in respect of the
Disposal Assets will comprise the sum of an upfront payment, a deferred payment and an earnout
payment, as described below, all payable in cash, by the Purchaser as set out below ("Disposal
Consideration").
4.1.2. The upfront payment shall be an amount equal to R100 million, on a cash free, debt free basis
payable on the Closing Date (as defined below).
4.1.3. The deferred payment will be calculated in accordance with customary adjustments based on the
Disposal Assets' receivables and net debt and working capital amounts as at the Closing Date. The
deferred payment will be payable at the earliest, on or about 50 business days after the Closing
Date, based on the management accounts as at the Closing Date. Should the deferred payment
have a negative value, ACT HA will pay the associated amount to the Purchaser.
4.1.4. The earnout payment will be based on the future performance of Activo and will be limited to a
maximum amount of R90 million and shall not result in any reduction in the aggregate of the upfront
payment and the deferred payment. The earnout payment will be calculated and paid six-monthly,
over 6 years, following the Closing Date.
4.2. Conditions to the Disposal
Implementation of the Disposal will be subject to the fulfilment or waiver, to the extent permitted, of the
following conditions precedent by 31 August 2026 (unless extended by ACT HA and the Purchaser by
agreement in writing):
4.2.1. the unconditional approval of the Disposal by the South African competition authorities in terms of
the Competition Act 89 of 1998, or conditional approval of the Disposal on terms and conditions
which each of the Purchaser and ACT HA confirm in writing to the other to be acceptable to it,
acting reasonably;
4.2.2. ACT HA having delivered to the Purchaser copies of the latest company and product registration
certificates, in respect of Forrester and Activo, to conduct pharmaceutical operations in South
Africa;
4.2.3. ACT HA obtaining the written consent of Nedbank Limited ("Nedbank"), in accordance with the
provisions of the facilities agreement entered into between various AfroCentric Group companies
as borrowers and Nedbank as inter alia the original lender, to: (i) implement the Disposal; (ii) release
ACT HA from its obligations as guarantor with regards to the Disposal Assets; and (iii) waive any
default as a result of the Disposal Assets ceasing to be subsidiaries of AfroCentric; and
4.2.4. the Cession Agreement becoming unconditional and binding in accordance with its terms.
4.3. Closing Date of the Disposal
The Closing Date of the Disposal will, unless otherwise agreed by the parties, be the last business day of
the month in which all the Conditions have been fulfilled or waived, or if all the Conditions are fulfilled or
waived on a date falling after the 25th day of the month, then the Closing Date shall be the last business day
of the month immediately following the month in which the Conditions are fulfilled or waived ("Closing Date").
4.4. Other significant terms of the Revised SPA
The Revised SPA contains warranties and indemnities given by ACT HA to the Purchaser, and by the
Purchaser in favour of ACT HA, which are customary for a transaction of this nature. The indemnities are
broadly in relation to: (i) pre-closing tax or contingent liabilities or claims of the Disposal Assets (including in
relation to the working capital adjustment which is part of the purchase price); (ii) compliance liabilities of the
Disposal Assets; and (iii) regulatory compliance in relation to the business conducted by the Disposal Assets.
5. APPLICATION OF THE DISPOSAL CONSIDERATION
The majority of the Disposal Consideration will be applied towards deleveraging the AfroCentric Group's balance
sheet, resulting in a reduction in interest expense due to the reduced debt. The remaining portion of the Disposal
Consideration will be applied to fund operational and strategic initiatives in the AfroCentric Group.
6. CLASSIFICATION OF THE DISPOSAL
As the value of the Disposal does not meet the 30% threshold outlined in paragraph 8.4(b) of the
JSE Listings Requirements, the Disposal is categorised as a category 2 transaction as contemplated in section 8
of the JSE Listings Requirements and is not subject to Shareholder approval.
Johannesburg
23 April 2026
Financial Advisor and Transaction Sponsor to Legal Advisor to AfroCentric
AfroCentric Webber Wentzel
Rand Merchant Bank (a division of FirstRand Bank
Limited) (a partner firm of Clairfield International)
Date: 23-04-2026 03:45:00
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