Increased investment by Sabvest in DNI-4PL Contracts (Pty) Limited (“DNI”) through JAA Holdings (Pty) Limited(“JAA")
(Incorporated in the Republic of South Africa)
(Registration number 1987/003753/06)
Share code: SBV – ordinary shares / SVN – ‘N’ ordinary shares
ISIN: ZAE000006417 – ordinary shares / ISIN: ZAE000012043 – 'N' ordinary shares
("Sabvest" or "the Company")
INCREASED INVESTMENT BY SABVEST IN DNI-4PL CONTRACTS (PTY) LIMITED ("DNI")
THROUGH JAA HOLDINGS (PTY) LIMITED ("JAA")
Shareholders are advised that a number of transactions have been concluded as follows:
- JAA has increased its investment in DNI from 34,9% to 46%.
- Sabvest, which currently owns 28,4% of JAA, will increase its investment in JAA
to 34,78% in two tranches totaling R118,5m by 29 April and by 29 June 2019.
- This will have the effect of increasing Sabvest’s indirect interest in DNI to 16%.
- The balance of 65,22% in JAA will be held by AJD Holdings (Pty) Limited, an
entity owned and controlled by the family of Mr Andrew Dunn, the CEO of DNI.
2. Categorisation of the investment
Sabvest announced its first investment in JAA on 31 October 2018 in an amount of
R159,7m. This subsequent investment is required to be aggregated with the first
investment in considering the categorisation of the transactions and has accordingly
been determined to be a category 2 transaction requiring an announcement in terms of
section 9.5(a) of the JSE Listings Requirements and Sabvest’s approved investment
3. Nature of the business of JAA
JAA is a SPV formed for the sole purpose of owning shares in DNI.
4. Nature of the business of DNI
The primary business of DNI is the provision of technology, logistics and distribution
services to the telecommunications industry through a network of sales agents and
special purpose vehicles in urban and rural communities. DNI is a leading distributor of
pre-paid airtime, mobile subscriber starter packs and sim cards. It is also a distributor of
cellphones to LSM 1-3 consumers in South Africa. Its other operations include
Money4Jam, a micro jobbing platform, and International Tower Corporation which
provides financing for telecommunication tower networks in South Africa.
5. Rationale for the increased investment
Sabvest was previously invested in DNI through JAA in accordance with the
announcement of 31 October 2018. Sabvest is very satisfied with the performance and
growth prospects of DNI and accordingly decided to increase its investment when the
6. Investment consideration
6.1 The additional investment in JAA by Sabvest will be R118,5m by way of a
subscription for additional ordinary shares in JAA.
6.2 The investment amount will be funded from Sabvest’s cash resources.
7. Conditions precedent
The investment is subject to certain conditions precedent which may be met or can be
waived by Sabvest at its discretion on or before 29 April 2019.
8. Financial effects on Sabvest
8.1 There will be no effect on the NAV per share as the investment amount and the
fair value of the investment are expected to be the same on the date of the
8.2 There will be no effect on HEPS and EPS as the projected increase in valuation
for the first accounting period for fair value purposes is expected to be
approximately equal to the interest foregone on the cash balances from which
the investments will be funded.
9. Financial profile of DNI
The following information relates to the audited PAT and NAV of DNI, prepared in terms
of International Financial Reporting Standards, that would have been attributable to a
16% look-through equity interest in DNI if it had been held by JAA for the financial year
ended 30 June 2018:
9.1 PAT R42,3m
9.2 NAV R70,1m
2 April 2019
RAND MERCHANT BANK (A division of FirstRand Bank Limited)
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