TWK Agriculture Holdings (Pty) Ltd Restructuring of TWK Group
14 July 2014
The shareholders of TWK Agriculture Holdings (Pty) Ltd approved the proposed restructuring of the TWK Group at the annual general meeting held in Piet Retief on 29 March 2012.
Due to unforeseen circumstances the initial implementation date of 1 September 2013 was postponed.
The restructuring will take effect on 1 September 2014, from which date all the arrangements as described below will be valid.
On 1 September 2014, each TWK Agriculture Holdings (Pty) Ltd shareholder will receive a distribution of one (1) TWK Investments Ltd share for every two (2) TWK Agriculture Holdings (Pty) Ltd shares held whilst retaining its current shareholding in TWK Agriculture Holdings (Pty) Ltd. TWK Shareholders will therefore effectively hold the same interest in the TWK Group before and after the Restructuring. A letter confirming the distribution of the TWK Investments shares will be sent to shareholders during September 2014. Shareholders’ TWK Investments Ltd shares will be available for trading on 1 September 2014.
Please take note that a limited number of TWK Investments shares will be available for trading on 1 September 2014.
The rationale for and objectives of the Restructuring are to create a platform to enable existing TWK Shareholders to enhance and/or unlock value in the foreseeable future. The Restructuring is also required to prepare for the BEE Transaction by creating a separate subsidiary which will house the businesses within the TWK Group that require empowerment.
The current TWK Group structure involves TWK owning certain businesses (being its grain, timber, trade and financial services divisions) directly, whilst at the same time it holds shareholdings in a number of operating companies.
The implementation of the transaction will affect the TWK Group and TWK Shareholders as follows:
- TWK Agriculture Holdings (Pty) Ltd will become the controlling shareholder of the TWK Group and will serve the purpose of a controlling holding company for TWK Shareholders.
- The shares in TWK Agriculture Holdings (Pty) Ltd will still be traded on the over-the-counter (“OTC’) trading platform and will continue to have the existing trading restrictions in place.
- TWK Shareholders will retain their current shareholding in TWK Agriculture Holdings (Pty) Ltd.
- TWK Investments Ltd will be a public company.
- TWK Investments Ltd will be controlled by TWK Agriculture Holdings (Pty) Ltd (the controlling holding company).
- The shares in TWK Investments will also be traded on the OTC platform, but with no trading restrictions and therefore result in improved liquidity to unlock value.
- TWK Agri (Pty) Ltd will be a private company whose purpose will be to house the businesses that require empowerment.
- The Vumbuka Trust, a broad-based BEE trust will acquire unencumbered shares in this company.
- Trading in TWK Agri (Pty) Ltd shares will be restricted to ensure that TWK Agri always remains within control of the TWK Group and that control is exercised over the BEE status of the company.
- The South African businesses (grain, timber, trade and financial services) will be perated in this entity.