Rainbow buys more of Foodcorp
On 29 April 2013 Rainbow acquired an effective 64.2% of the issued ordinary share capital of Foodcorp through its subsidiary Capitau Investment Management (Pty) Ltd. (“the Acquisition”). As at the effective date of the Acquisition, Foodcorp management collectively held 23.9% of Foodcorp directly and via Foodcorp Management Holdings (Pty) Ltd. RCL has now agreed with Foodcorp management to acquire their 23.9% stake in Foodcorp (the “Transaction”). The Transaction will increase Rainbow”s effective interest in Foodcorp to 88.1%. Foodcorp management remains fully committed to the business of Foodcorp and aligned to Rainbow”s long term strategic objectives.
Terms of the Transaction
Rainbow will pay Foodcorp management and Foodcorp Management Holdings (Pty) Ltd. a total cash consideration of R393 million for their 23.9% stake in Foodcorp. There are no outstanding conditions precedent to the Transaction, and the effective date of the Transaction is 1 July 2013.
Small related party transaction
In terms of the JSE Ltd. (“JSE”) Listings Requirements, the Transaction is a small related party transaction for Rainbow”s subsidiary Foodcorp. As such, Deloitte Corporate Finance (“Deloitte”) has provided the Board of Rainbow with written confirmation, in its capacity as independent professional expert, confirming that the Transaction is fair to Rainbow shareholders. Deloitte”s opinion (the content of which is still subject to JSE approval) is available for inspection at the registered office of Rainbow for a period of 28 days from the date of this announcement.