LONR Lonrho

 

TIDMLONR 
 
RNS Number : 0836M 
Lonrho PLC 
18 May 2010 
 

18 May 2010 
 
LONRHO PLC 
("Lonrho" or "the Company" or "the Group") 
 
 
Lonrho Plc's Agribusiness division increases holding in Rollex to 100 per cent 
 
Lonrho Plc (AIM:LONR) has agreed today to increase its holding in the issued 
share capital of Rollex (Pty) Limited ("Rollex") from the current 51 per cent 
to 100 per cent. 
 
In April 2008 Lonrho acquired a 51 per cent stake in Rollex, from the trustees 
of the De Robillard Family Trust, for an initial cash payment of ZAR40 million 
(approximately GBP2.6 million) and the commitment to make two further payments 
linked to the EBITDA performance of Rollex.  The first of these deferred 
consideration payments for the initial 51 per cent stake, being the sum of 
ZAR33.6 million (approximately GBP2.5 million), was paid in August 2009. All the 
remaining shares in Rollex have been acquired on terms which include the second 
tranche of the original sale price. 
 
Lonrho has now agreed to acquire, from the trustees of the De Robillard Family 
Trust, the remaining 49 per cent of the issued share capital in Rollex that 
Lonrho did not previously own (" the remaining Rollex shares"). The 
consideration payable has been translated into sterling and a fixed number of 
Lonrho shares determined by reference to the formula approved by shareholders at 
the Lonrho AGM on 31 March 2010. The consideration for the remaining Rollex 
shares will be satisfied by the issue of 42,119,258 new ordinary shares of 1 
pence in Lonrho ("Consideration Shares") at an agreed price of ZAR51,450,000 
(approximately GBP4,626,798) being 10.98 pence per share. At the closing mid 
market price, of 10 pence per Lonrho Ordinary Share, on 17 May 2010 the value of 
the remaining Rollex shares was therefore GBP4,211,926. Application has been 
made for the Consideration Shares to be admitted to trading on AIM and dealings 
are expected to commence on or about the 28 May 2010. 
 
The Rollex profits for the period ending 30 September 2009 were ZAR16.6 million 
(approximately GBP1.1 million). Net assets at that date amounted to ZAR38.9 
million (approximately GBP3.47 million). 
 
The effect of the transaction on the Company will be to give Lonrho 100 per cent 
control of Rollex and consequently increase the level of profit attributable to 
Lonrho shareholders (and thus reducing the share of profit attributable to 
minorities) in the Group profit and loss account. 
 
The beneficiary of the De Robillard Family Trust is Paul de Robillard, the 
Managing Director of Rollex and as such this transaction will constitute a 
related party transaction for the purposes of the AIM Rules for Companies. The 
Lonrho Board is of the opinion that the agreed price of R51.5 million (GBP4.62 
million) is a discount to the current value of the shares being acquired and 
therefore represents a fair and reasonable price for the shareholders of Lonrho. 
The Lonrho board has therefore consulted with the Company's nominated advisor in 
relation to the transaction and following such consultation the board of Lonrho 
Plc has determined that the terms of the transaction are fair and reasonable 
insofar as the shareholders of Lonrho are concerned. Prior to this transaction 
Paul de Robillard did not own any shares in Lonrho but, immediately following 
completion, he will own 42,119,258 ordinary shares of 1 pence in Lonrho 
representing 3.86 per cent of the enlarged issued share capital of the Company. 
 
The Consideration Shares will be subject to a lock-in for a period of twelve 
months from the date of completion of the transaction and thereafter will be 
subject to orderly market provisions. It has been agreed that such number of 
Consideration Shares as is equal in value to ZAR19 million may be sold in a 
manner so as to maintain an orderly market to satisfy certain liabilities 
arising for the vendor from the transaction. 
 
Rollex, which was established in 1989, sources, packs and delivers fresh fruit, 
vegetables and fish produce from across Africa to its network of high profile 
retail clients in Africa, Europe, Scandinavia and the Middle East Paul de 
Robillard will remain as Managing Director of Rollex, post the transaction. 
 
David Lenigas, Lonrho's Executive Chairman stated: 
"Rollex is one of the cornerstones of the Lonrho Agriculture division. Since 
Lonrho bought a controlling stake in April 2008, it has proven its value. Given 
the growth opportunities and new projects being initiated by the company in this 
specialised niche sector, the Board believed that 100 per cent ownership was 
important and very beneficial to shareholders. The fact that Paul de Robillard 
has agreed to subscribe for Lonrho stock with appropriate lock-ins demonstrates 
his belief in the business and what it can achieve." 
 
 
Enquiries 
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This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
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