Tongaat Hulett disposes of its interest in Tongaat Hulett (Namibia) (Proprietary) Limited Tongaat Hulett Limited (Registration number 1892/000610/06) Share code: TON ISIN ZAE000096541 ("Tongaat Hulett" or "the Company") TONGAAT HULETT DISPOSES OF ITS INTEREST IN TONGAAT HULETT (NAMIBIA) (PROPRIETARY) LIMITED 1. Introduction Shareholders of Tongaat Hulett are referred to the announcements released by the Company on SENS, in particular the announcement of 31 May 2019 in relation to the ongoing strategic and financial review ("Strategic Review") of the Tongaat Hulett group. 2. Background and rationale As part of the Strategic Review, the board of directors of Tongaat Hulett ("Board") is pleased to announce that it has approved the disposal of the business of Tongaat Hulett (Namibia) (Proprietary) Limited ("THN" or "the Seller"), in which Tongaat Hulett owns an effective 51% beneficial interest. Accordingly, THN has entered into a sale of business agreement ("Sale Agreement") to sell the entire sugar packaging and distribution business ("Namibian Business") of THN to Bokomo (Namibia) (Proprietary) Limited ("Bokomo") as a going concern ("Proposed Transaction"). Notwithstanding that THN is a strong and well-established business in Namibia, the Board has considered it as non-core and is of the view that its disposal would allow the Namibian Business to grow into new areas while facilitating Tongaat Hulett's access to the market via long term sugar and related products supply agreements concluded with Bokomo. 3. Salient terms of the Proposed Transaction The Proposed Transaction will become effective from the first calendar day following the calendar month during which the last of the suspensive conditions in the Sale Agreement is fulfilled or waived ("the Effective Date"). The risk in, and benefit of the Namibian Business will pass to Bokomo on the Effective Date. The purchase price on a debt free basis for the Namibian Business is N$220 000 000 (R220 000 000) payable in cash on closing, subject to a post-closing adjustment relating to any variation from the agreed normalised working capital level of N$25 000 000 (R25 000 000). Tongaat Hulett, as 51% beneficial owner of the Seller, will ultimately share in 51% of the proceeds from the sale, and assuming no post-closing adjustments are made to the purchase price, 51% of the proceeds will equate to N$112 200 000 (R112 200 000) before deductions for taxes and transaction costs are made. Tongaat Hulett plans to use its share of the proceeds to reduce its debt levels. 4. Conditions Precedent The implementation of the Proposed Transaction is conditional upon the fulfilment or waiver (as applicable) of, amongst others, the following suspensive conditions: - the Namibian Competition Commission approving the Proposed Transaction and, in particular, the sale of the Namibian Business; and - the completion of a due diligence investigation into the Namibian Business to the satisfaction of Bokomo by no later than 30 November 2019. Shareholders are advised that the due diligence investigation is largely complete and the process for filing with the Namibian Competition Commission is underway. 5. Net asset value and Profit attributable to the Seller The net asset value attributable to the Namibian Business as at 31 March 2019 was N$37 152 135 (R37 152 135). Profit after tax for the year ended 31 March 2019 was N$30 130 633 (R30 130 633), while attributable earnings were N$15 366 623 (R15 366 623). This information has been extracted from the unpublished management accounts and the Company confirms that it is satisfied with the quality of such management accounts. This financial information has however not been reviewed or reported on by Tongaat Hulett’s external auditors. 6. Categorisation The Proposed Transaction is categorized as a category 2 transaction in terms of the Listings Requirements of the JSE Limited and accordingly no shareholder approval is required. 19 November 2019 Corporate Advisor and Transaction Sponsor PricewaterhouseCoopers Corporate Finance Proprietary Limited Legal Advisors to Tongaat Hulett Webber Wentzel Legal Advisors to Bokomo Engling Stritter & Partners Company Sponsor Investec Bank Limited Date: 19/11/2019 01:00:00 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 the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, 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.