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RCL FOODS- PROPOSED ACQUISITION AND BEE TRANSACTION

RCL has entered into an agreement with TSB Sugar Holdings (Pty) Ltd. (“TSB Sugar Holdings”) to acquire 100% of the issued ordinary shares in its two operating subsidiaries, namely TSB Sugar RSA (Pty) Ltd. (“TSB Sugar RSA”) and TSB Sugar International (Pty) Ltd. (“TSB Sugar International”) (collectively referred to as “TSB”) from TSB Sugar Holdings (“TSB Acquisition”). The effective date of the TSB Acquisition is subject to the fulfillment of the conditions precedent outlined below by no later than Friday, 28 February 2014. TSB Sugar Holdings is an indirect wholly owned subsidiary of Remgro Ltd. (“Remgro”), RCL”s controlling shareholder.

TSB Acquisition consideration
The TSB Acquisition consideration is R4 billion and will be discharged through the issue of 230 946 882 ordinary shares in the share capital of RCL (“Shares”) to TSB Sugar Holdings, at an issue price of R17.32 per Share (“TSB Acquisition Share Price”), calculated with reference to the 30-day volume weighted average price per Share to Tuesday, 19 November 2013. Upon implementation of the TSB Acquisition, Remgro will effectively hold 77.7% of the total Shares in issue through its internal holding structure. The TSB Acquisition constitutes a category 1 related party transaction for RCL in terms of the JSE Ltd. Listings Requirements (“Listings Requirements”) and will require the approval of RCL shareholders (“Shareholders”).

Conditions precedent to the TSB Acquisition
The TSB Acquisition is subject to the fulfillment of inter alia the conditions precedent that:
*by no later than 17h00 on Friday, 28 February 2014:
**Shareholders pass all resolutions required to approve the implementation of the TSB Acquisition;
**the counterparties to the material contracts of TSB consent in writing to the change of control of TSB, to the extent necessary; and
*within 30 days of the signature date of the TSB Acquisition agreement, RCL delivers a written notice to TSB Sugar Holdings confirming that it is satisfied with the disclosures prepared by TSB Sugar Holdings in respect of the warranties given by it in terms of the TSB Acquisition agreement.

RCL BEE Transaction

Unwinding of the Current BEE Structure
In terms of the Company”s existing BEE structure as approved by Shareholders in 2008 (“Current BEE Structure”), RCL”s strategic partners, being the Imbewu Consortium, the Ikamva Labantu Empowerment Trust and Mrs. Manana Margaret Nhlanhla (“Strategic Partners”) and a share ownership trust established for the employees of the RCL Foods group (collectively the “BEE Parties”), subscribed for 51 177 217 Shares (“Current BEE Shares”) through a special purpose vehicle, Eagle Creek Investments 620 (Pty) Ltd. (“Eagle Creek”). At the time of issue, the Current BEE Shares represented 15% of the Company’s issued Shares which has since been diluted by virtue of the BEE Parties not participating in the RCL Foods rights issue in February 2013. The Current BEE Structure was funded by RCL Foods through the subscription for preference shares in Eagle Creek (“Eagle Creek Preference Shares”). The Current BEE Structure is considered unlikely to deliver any equity value to the BEE Parties and as such, RCL Foods and the BEE Parties have agreed to unwind the Current BEE Structure and implement a new BEE ownership transaction in order for RCL Foods to sustain its BEE ownership and to create value for the BEE Parties.

The Current BEE Structure will be unwound by implementing a redemption of the Eagle Creek Preference
Shares and a specific repurchase of the Current BEE Shares, at a repurchase price per Current BEE Share based
on the 30-day volume weighted average price per Share to the date on which the Eagle Creek Preference
Shares are redeemed (“Specific Repurchase”). The Current BEE Shares will, pursuant to the Specific
Repurchase, be delisted from the securities exchange operated by the JSE Ltd. (“JSE”) and the proceeds of
the Specific Repurchase will be utilised by Eagle Creek to redeem the Eagle Creek Preference Shares.

RCL BEE Transaction
A new BEE ownership transaction will be implemented through the issue of 63 830 231 new Shares (“New RCL Foods BEE Shares”) to the BEE Parties by way of both a special purpose vehicle and a new employee share ownership trust (“RCL Foods BEE Transaction”). The issue of the 63 830 231 New RCL Foods BEE Shares will be facilitated partly through a NVF mechanism (c.69% or 43 883 284 New RCL Foods Shares) and through the issue of preference shares to RCL Foods (c.31% or 19 946 947 New RCL Foods Shares). 43 883 284 of the New RCL Foods BEE Shares will, subject to the terms and conditions of the relevant subscription agreement, be issued to the BEE Parties at R0.01 per Share in terms of a NVF mechanism. The NVF facilitation will be based on a 30-day volume weighted average price per Share to Tuesday, 19 November 2013, being R17.32 per Share. The remaining 19 946 947 of the New RCL Foods BEE Shares will, subject to the terms and conditions of the relevant subscription agreement, be issued to the BEE Parties at R17.32 per Share, being the 30-day volume weighted average price per Share to Tuesday, 19 November 2013, which will be funded through the issue of preference shares to RCL Foods.

Of the total 63 830 231 New RCL Foods BEE Shares to be issued to the BEE Parties, 30% of the New RCL Foods BEE Shares will be allocated to the Strategic Partners (i.e. 19 149 069 New Foods BEE Shares) and 70% to be allocated to the new employee share ownership trust (i.e. 44 681 162 New RCL Foods BEE Shares). The New RCL Foods BEE Shares issued to both the Strategic Partners and the new employee share ownership trust will be facilitated in terms of a NVF mechanism (c.69%) and the balance through the issue of preference shares to RCL Foods (c31%).

Conditions precedent to the RCL BEE Transaction
The RCL Foods BEE Transaction is subject to the fulfillment of inter alia the conditions precedent that, by no later than 17h00 on Monday, 31 March 2014:
*the Specific Repurchase becomes unconditional;
*Shareholders pass all resolutions required to approve and implement the RCL Foods BEE Transaction; and
*all legal agreements necessary to implement the RCL Foods BEE Transaction (including the relevant NVF and preference shares subscription) have been entered into and become unconditionally operative in accordance with their terms.

Proposed Equity Capital Raising

Introduction and rationale

RCL is currently considering significant growth and expansion projects in South Africa and sub-Saharan
Africa in the broader food and fast moving consumer goods space. In order to capitalise fully on these opportunities, RCL Foods has determined that it requires additional capital. The Board has accordingly resolved to propose a capital raising in the amount of R2.5 billion through a combination of a pro rata offer to all Minority Shareholders (namely, all Shareholders excluding Remgro and its subsidiaries, and Eagle Creek) (“Pro Rata Offer”) and a specific issue of new Shares via a placement to qualifying investors (“Placement”) (collectively the “Equity Capital Raising”).

Details of the Pro Rata Offer
In light of the anticipated dilution of Minority Shareholders’ relative shareholdings pursuant to the implementation of the TSB Acquisition, the Company intends to make a pro rata offer to all Minority Shareholders in order to afford them the opportunity to subscribe for that number of Shares as will enable them to maintain their respective shareholding percentages in RCL Foods following the implementation of the TSB Acquisition. In terms of the Pro Rata Offer, post the implementation of the TSB Acquisition and Specific Repurchase, the Company will offer 74 140 200 Shares (“Pro Rata Offer Shares”) to Minority Shareholders in the ratio of 53.11 Pro Rata Offer Shares for every 100 Shares held by Minority Shareholders on the record date for the Pro Rata Offer, which is expected to be Friday, 31 January 2014. The final terms of the Pro Rata Offer, including the Pro Rata Offer price and the pro forma financial effects of the Pro Rata Offer will be announced on the finalisation date of the Pro Rata Offer, which is expected to be Friday, 17 January 2014.

It is the intention of the Board that the subscription proceeds from the Pro Rata Offer will be applied, inter alia, towards the future growth and expansion of RCL Foods’ operations in South Africa and sub-Saharan Africa. Minority Shareholders that do not elect to subscribe for Pro Rata Offer Shares in terms of their entitlements will continue to own the same number of Shares, but their respective shareholding percentages in RCL Foods will be diluted as a consequence of the issue of Shares pursuant to the TSB Acquisition and the Pro Rata Offer. There will be no right to apply for excess Pro Rata Offer Shares and Minority Shareholders will not be entitled to trade their entitlements under the Pro Rata Offer. Further details of the Pro Rata Offer, including the salient dates and times and procedures for acceptance will be contained in the circular to Shareholders referred to below.

Details of the Placement
Market conditions permitting, it is the intention of the Board to place Shares with qualifying South African and international investors in order to raise the balance of the R2.5 billion not raised pursuant to the Pro Rata Offer. The Placement is intended to diversify the RCL Foods shareholder base, further increase the free float and improve liquidity in the Shares. The quantum and pricing of the Placement will be communicated to qualifying investors post the implementation of the Pro Rata Offer. Qualifying existing shareholders will also be entitled to participate in the Placement.

Conditions precedent to the Equity Capital Raising
The Pro Rata Offer will be subject to the fulfilment of the conditions precedent that:
*the TSB Acquisition is implemented; and
*Shareholders pass the necessary resolutions to authorise the specific issue of Shares in terms of the Pro Rata Offer.

The Placement will be subject to Shareholders approving the specific issue of Shares in terms of the placement.

General Meeting
The Company will convene a general meeting of Shareholders in order to obtain the necessary Shareholder approvals to implement the TSB Transactions, the RCL BEE Transactions and the Equity Capital Raising (“General Meeting”).

Salient dates and times
The proposed salient dates and times pertaining to the General Meeting are set out below.
*Record date to determine which Shareholders are entitled to receive the circular on Friday, 6 December 2013
*Circular posted to Shareholders on or about Thursday, 12 December 2013
*Last day to trade in Shares in order to be recorded in the register in order to participate in and vote at the General Meeting on Friday, 3 January 2014
*Record date to be entitled to participate in and vote at the General Meeting on Friday, 10 January 2014
*Last day to return forms of proxy in respect of the General Meeting to the transfer secretaries by 13:30 on Tuesday, 14 January 2014
*General Meeting to be held at the company”s registered office, Six The Boulevard, Westway Office Park, Westville, Durban at 13:30 on Thursday, 16 January 2014
*Results of the General Meeting to be published on SENS on Thursday, 16 January 2014

Documentation
A circular to Shareholders, detailing the TSB Transactions, the RCL BEE Transactions, and the Equity Capital Raising, and incorporating revised listing particulars and a notice of General Meeting, will be posted to Shareholders on or about Thursday, 12 December 2013.