- position the Group for future value-enhancing investment opportunities;
- create an efficient and professional management structure for the Group’s equity investments;
- improve the balance sheet concentration exposure;
- provide a balance between the Group’s short-term cash generative assets and longer- term growth assets; and
- increase the Group’s equity holding in assets considered to have high growth potential.
In furtherance of this strategy, the Board is pleased to advise that:
a) Ecsponent Treasury Services (Pty) Ltd. (“Ecsponent Treasury Services”), a wholly owned subsidiary of Ecsponent, has entered into an acquisition agreement to subscribe for 100% of the issued ordinary shares (“Acquisition Shares”) of Pink Orchid Ltd. (“Pink Orchid”), an investment holding company yet to be incorporated, from Purple Orchid Ltd. (“Purple Orchid”), a wholly owned subsidiary of Ecsponent Capital (RF) Ltd. (“Capital”), a related party, for a total consideration of R280 million (“the Pink Orchid Acquisition”);
b) Ecsponent has entered into a subscription agreement (“Subscription Agreement”) with Invest Solar Africa Ltd. (“Invest Solar Africa”), a related party, in terms of which the Company has agreed to subscribe for a maximum of 40 000 000 shares in Invest Solar Africa at a subscription price of BWP1.00 (one Botswana Pula) per share, pursuant to a private placement of such shares (“Private Placement”);
c) Ecsponent has entered into an underwriting agreement with Invest Solar Africa, in terms of which Ecsponent has agreed to underwrite and subscribe for all the shares in Invest Solar Africa which are not taken up during the initial public offering of Invest Solar Africa pursuant to the listing of its ordinary shares on the Venture Capital Board of the Botswana Stock Exchange (“BSE”) (“Underwriting Agreement”);
d) Ecsponent has entered into an investment management agreement (“Investment Management Agreement”) with MHMK Capital Botswana Ltd. (“MHMK Capital”), a related party, which is controlled by George Manyere, a material shareholder and a non-executive director of the Company, in terms of which MHMK Capital will manage the portfolio of assets and investments owned by Ecsponent Ltd. incorporated in Botswana (“ECS Botswana”) a wholly owned subsidiary of the Company;
e) Return on Innovation (Pty) Ltd. (“ROI”), a wholly-owned subsidiary of Ecsponent has entered into an agreement with GetBucks (Pty) Ltd. (“GetBucks SA”), in terms of which ROI has agreed to purchase specified loan claims from GetBucks SA (“Asset Acquisition”); and
f) Ecsponent has disposed of its 50% equity holding in Cryo-Save South Africa (Pty) Ltd. and Salveo Swiss Technologies Ltd to Go Life International for R10 million.
(collectively “the Transactions”).
Circular
A circular, setting out all the details of the Pink Orchid Acquisition, Subscription, Underwriting and the Investment Management Agreement and incorporating revised listing particulars, the requisite fairness opinions and a notice of a general meeting, will be distributed to shareholders of the Company in due course.
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