Internalisation of management agreement and cautionary announcement
Zeder Investments Limited
(Incorporated in the Republic of South Africa)
Registration number: 2006/019240/06
Share code: ZED
ISIN code: ZAE000088431
PSG Group Limited
(Incorporated in the Republic of South Africa)
Registration number 1970/008484/06
Share code: PSG
ISIN code: ZAE000013017
1. Shareholders are advised that Zeder and PSG, through its wholly-
owned subsidiary PSG Corporate Services Proprietary Limited
(“PSGCS”), have agreed that the existing management agreement and
function in terms of which PSGCS provides investment, management,
financial and other services to Zeder and its subsidiaries, be
internalised by Zeder against the issue of 207 661 758 new Zeder
ordinary shares to PSGCS at Zeder’s 30 day volume weighted average
share price up to the effective date (“Internalisation”).
2. The Internalisation will result in a significant improvement in
Zeder’s future profitability and cash flows, and potentially its
market rating following the associated management fee cost
savings. PSG will remain a significant shareholder in Zeder and
the existing PSG representatives will continue to serve on both
the Zeder Executive Committee and Zeder Board to help determine
strategy and make investment decisions for at least the next 5
years at a nominal fee of R5 million per annum.
3. Should the Internalisation be implemented, PSG’s shareholding in
Zeder will increase from approximately 34.5% to approximately
42.4% of Zeder’s total issued ordinary share capital.
4. The Internalisation is subject to various conditions precedent,
including Zeder shareholder approval and the waiver by Zeder
shareholders of a mandatory offer to them by PSG as a result of
this transaction. Indications are that the major shareholders
support the Internalisation as set out above.
5. A circular will be dispatched to Zeder shareholders in due course
to provide them with detailed information regarding the
Internalisation and to convene a general meeting, at which
shareholders other than PSG will have the opportunity to consider
and vote on the Internalisation.
6. An independent board has been constituted by Zeder to consider
the Internalisation and to advise shareholders of their opinion
in relation to the Internalisation. The independent board has,
in turn, appointed an independent expert to provide it with
external advice and to prepare a report, indicating whether the
Internalisation would be fair and reasonable to Zeder
shareholders. A copy of this report will be included in the
circular to Zeder shareholders.
7. Zeder shareholders are advised to exercise caution when dealing
in Zeder’s securities until full details regarding the
Internalisation have been made public.
24 June 2016
PSG Capital: Transaction adviser and sponsor to Zeder and PSG
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