REG - Cambria Africa PLC - Notice of General Meeting and Waiver of Rule 9 <Origin Href="QuoteRef">CMBC.L</Origin>

Cambria AfricaAnnouncement

26/03/2015 08:40

RNS Number : 5357I
Cambria Africa PLC
26 March 2015
26 March 2015
Cambria Africa plc
("Cambria" or the "Company")
Proposed Waiver of Rule 9 of the Takeover Code
Notice of General Meeting
Further to the announcement by the Company on 18 February 2015, Cambria has posted to shareholders a notice of general meeting ("General Meeting") of the Company to be held at 9am on 13 April 2015 at 1 Berkeley Street, Mayfair, London, along with a circular (the "Circular"), in connection with the intention to raise 909,500 by way of a conditional subscription ("Subscription") to new ordinary shares in the Company ("Ordinary Shares") and a proposed waiver of Rule 9 of the Takeover Code. Extracts from the letter from the Chairman contained in the Circular are set out below, which includes the background to and reasons for the Subscription. A copy of the Circular will be available for download from the Company's website, www.cambriaafrica.com.
In order to facilitate the Subscription, shareholder approval is required of a number of resolutions to be proposed at the General Meeting. At the General Meeting, the following resolutions (the "Resolutions") will be proposed:
Resolution 1 - grant a waiver of Rule 9 of the Takeover Code
Resolution 2 - grant of authority to allot shares for cash, disapplying statutory pre-emption rights
In addition, it is proposed that on completion of the Subscription, Messrs. Paul Turner, Itai Mazaiwana and Fred Jones will resign from the Board and Ventures Africa Limited ("VAL") shall be entitled to nominate 3 additional Directors, subject to due diligence compliance for directors of an AIM listed company. VAL has nominated Mr. Santosh K. Gujadhur as its first nominated Director. On Completion, the Board will consist of Mr. Perkins (non-executive Chairman), Mr. Wisman (CEO) and Mr. Gujadhur (non-executive Director).
Contacts



Cambria Africa Plc
www.cambriaafrica.com
Ian Perkins
+44 (0) 796 4908 951
Edzo Wisman
+44 (0) 796 4908 950


WH Ireland Limited
www.wh-ireland.co.uk
James Joyce / Mark Leonard
+44 (0) 207 220 1666




Peterhouse Corporate Finance Limited
www.pcorpfin.com
Charles Goodfellow / Duncan Vasey
+44 (0) 207 220 9791
FTI Consulting
www.fticonsulting.com
Edward Westropp / Adam Cubbage
+44 (0) 203 727 1521
EXPECTED TIMETABLE OF PRINCIPALEVENTS ANDKEYSTATISTICS
Date of this Announcement
26 March 2015
Time and date of the Extraordinary General Meeting
9 a.m. 13 April 2015
Issue of Subscription Shares
13 April 2015
OrdinarySharesin issueatthedateofthisAnnouncement
104,655,162
Subscription shares
107,000,000
Number of New Ordinary Shares in issue following the Subscription
211,655,162
Percentage of the enlarged issued share capitalofthe Company representedby theSubscriptionShares
50.55%
Notes:
All references to time in this announcement are to London time. Each of the times and dates in this announcement may be subject to change. If any of the above times and/or dates change, the revised times and/or dates will be notified to shareholders by announcement through a regulatory information service.
DEFINITIONS
The following definitions apply throughout this announcement unless the context requires otherwise:
"AIM" the AIM market operated by London Stock Exchange
"AIM Rules" the AIM Rules for Companies published by London Stock Exchange
"Announcement" this announcement
"Articles" the Articles of Association of the Company
"Allotment" the allotment of the Subscription Shares to VAL
"Board" the board of directors of the Company, comprising Ian Perkins, Paul Turner, Edzo Wisman, Fred Jones and Itai Mazaiwana
"Circular" the circular dated 26 March 2015 for the EGM, sent to Shareholders
"City Code" the City Code on Takeovers and Mergers
"Company" or "Cambria" Cambria Africa PLC, a company registered in the Isle of Man with company number 001773V
"Completion" completion of the terms of the Share Subscription Agreement
"Directors" or "Board" the directors of the Company
"Form of Proxy" the form of proxy enclosed with the Circular for use by Shareholders in connection with the Extraordinary General Meeting
"Encyclia Logistics"  Encyclia Logistics Limited, a company registered in Mauritius with company number 123381
"ExtraordinaryGeneral Meeting"  the extraordinary general meeting of the convened by
or "EGM" the relevant notice set out in the end of this announcement
"Independent Shareholders" Shareholders, independent of the transactions referred to in this Announcement
"Issued Share Capital" 104,655,162 Ordinary Shares in issue at the date of this Announcement
"London Stock Exchange" London Stock Exchange PLC
"Long Stop Date" 15 June 2015 
"Lonzim Holdings" Lonzim Holdings Limited, a company registered in the Isle of Man with company number 002080V
"Lonzim Hotels" Lonzim Hotels Limited,a company registered in the Isle of Man with company number 003776V
"NOMAD" the Company's nominated adviser, being WH Ireland
"Notice of EGM" the notice of Extraordinary General Meeting which is set out on page 18 of the Circular
"Ordinary Shares" or "Shares" ordinary shares of 0.01 pence (0.0001) each in the share capital of the Company
"Panel" the Panel on Takeovers and Mergers
"Peterhouse" Peterhouse Corporate Finance Limited
"Record Date" close of business on 25 March 2015
"Resolutions" the resolutions set out in the Notice of  EGM or any one of them, as the case may be
"S. Shasha and Associates" S. Shasha and Associates (Private) Limited, a company registered in Zimbabwe with company number 3232/1995
"Shasha & Associates USA" Mr. Samir Shasha's sole proprietorship headquartered in Chicago, Illinois.
"Shareholders" the holders of the Shares in the Company at the Record Date
"Subscription" the subscription for the Subscription Shares by VAL pursuant to the Subscription Agreement
"Subscription Agreement" the agreement dated 15 February 2015 entered into between VAL and the Company, details of which are set out in paragraph 4(i) of Part II of the Circular
"Subscription Price" 0.85 pence per New Ordinary Share
"Subscription Shares"  107,000,000 new Ordinary Shares to be subscribed by VAL pursuant to the Subscription Agreement
"VAL" Ventures Africa Limited a company registered in theIsle of Man with Company Number 011652V
"Waiver"  the waiver granted by the Panel, conditional upon the approval by the Independent Shareholders of the Whitewash Resolution, of any obligation which would otherwise be imposed on VAL under Rule 9 of the City Code as a result of the issue of the Subscription Shares 
"WH Ireland"  WH Ireland Limited
"Whitewash Resolution" the ordinary resolution of Shareholders approving the Waiver set out as Resolution 1 in the Notice of EGM
LETTER FROM THE CHAIRMAN OF THE COMPANY
Dear Shareholder
Introduction
The Company announced on 16 February 2015 that it no longer intends to seek Shareholders' approval to cancel the admission of the Company's Shares to trading on AIM. The announcement followed the signing of the Subscription Agreement with VAL.
The purpose of this announcement is to provide further background on the Subscription and VAL and explain why the Directors consider the passing of the Resolutions, upon which the Subscription is conditional, to be in the best interests of the Company and its Shareholders as a whole.
The Subscription is conditional upon the passing of the Resolutions, further details of which are set out below.
Subscription
Under the terms oftheSubscriptionAgreement, VAL agreedtosubscribe forthe Subscription SharesattheSubscription Price,conditional,interalia, upon:
 the granting of the Waiver by the Panel of the obligation for VAL to make a general offer for the Company that would otherwise arise under Rule 9 of the City Code as a result of the Subscription (subject to Independent Shareholder approval);
 theapprovalbyIndependent ShareholdersattheEGMoftheWhitewashResolution; 
 the Shareholders voting to dis-apply pre-emption rights to enable the Allotment to complete; and
 the Board resolving to accept the resignations of Messrs Paul Turner, Itai Mazaiwana and Fred Jones as Directors with effect from Completion and the right of VAL to nominate, and for the Board to appoint, up to 3 additional Directors with effect from Completion subject in each case to such person satisfying the NOMAD's standard due diligence enquiries for directors of an AIM listed company.
In the event that such conditions are not satisfied, or waived by VAL where capable of waiver, or become incapable of fulfilment, before the Long Stop Date, the Subscription Agreement will terminate.
On Completion, VAL will be interested in 107,000,000 Ordinary Shares representing 50.55% of the enlarged share capital of the Company. 
FurtherdetailsoftheSubscriptionAgreementaresetoutinparagraph 4(i)ofPartII ofthe Circular. There are no further arrangements made by the Company in connection with, or dependent on, the Subscription Agreement.
Waiverof theobligationto makea mandatory offerunderRule9 of theCityCode
UnderRule9oftheCityCode,anypersonwhoacquiresaninterest(assuchtermisdefined intheCityCode)inshareswhich,takentogetherwiththesharesinwhichhe andpersons acting in concertwithhimare interested, carry 30%ormoreofthevoting rightsinacompany which issubject to the City Code,isnormally requiredtomakeageneraloffer to allof the remainingshareholderstoacquiretheirshares. 
Similarly,whenanyperson,togetherwith personsactinginconcertwithhim,isinterestedinshareswhichinaggregatecarrynotless than 30%of the voting rights butdoes nothold sharescarrying more than 50%of the voting rights of such acompany,ageneralofferwillnormally be required ifany further interestin sharesareacquiredby anysuchperson. Theselimitsapply totheentire concertparty aswell asthetotalbeneficialholdingsofindividualmembers. Suchanofferwouldhavetobemade incashatapricenotlessthanthehighestpricepaidbyhim,orbyanymemberofthegroup ofpersonsacting inconcertwithhim,forany interest insharesinthecompany during the12 monthspriorto theannouncementoftheoffer.
UnderRule37oftheCityCode, anyincrease inthepercentageholding ofashareholderwhichresultsfromacompanybuyingback itsown shareswillalsobe treated asanacquisitionfor thepurposeofRule9of theCity Code. A shareholderwill, insuchcircumstances,incuranobligationtomakeamandatoryofferunless theconsentofthePaneltoawaiverof such anobligation isobtained.
YoushouldnotethatiftheSubscriptioncompletes,VALwillhold50.55%ofthevotingrightsoftheCompany.
Inthesecircumstances,VALwouldbepermittedtomakefurtherpurchasesofOrdinaryShareswithout
incurringanobligationunderRule9tomakeageneraloffer to allholdersofOrdinary Shares.
ThePanelhasagreed, subjectto the WhitewashResolutionbeing passed by Independent Shareholders, towaivethe requirementunderRule9 oftheCity CodeforVAL tomakea mandatory offerfor theentire issuedordinary sharecapitalof theCompany as would otherwiseberequired.
The WhitewashResolution issubject to the approvalof Independent Shareholderson apoll where each Independent Shareholderwillbeentitledto onevote foreach OrdinaryShareheld.
TheDirectorsbelievethatitisinthebestinterestsoftheCompanythatthe Whitewash Resolutionbepassed.
Waiver of Pre-emption Rights
To enable the Subscription Shares to be issued to VAL, it will be necessary for Shareholders to waive their pre-emption rights on new share issues that would otherwise apply.
Included within the Resolutions is a resolution to dis-apply pre-emption rights for the Allotment pursuant to article 4 of the Articles.
About VAL
VAL is an Isle of Man limited liability company formed in October 2014 as an investment vehicle to acquire assets in southern Africa, 100% beneficially owned by Mr. Samir Shasha. Mr. Shasha has extensive experience in owning and managing companies in southern Africa including Zimbabwe. Furtherdetailsof VAL (and Mr. Shasha) aresetoutinparagraph3ofPartII ofthe Circular.
Mr. Shasha's investments have included, amongst others, the ownership and operation of Freightliner Truck and Case International distributorships, as well as Zimbabwe Online, Zimbabwe's largest internet service provider, which was subsequently sold to Liquid Telecom, an Econet Wireless subsidiary, in 2012.
Mr. Samir Shasha and the Company both have offices in Harare and for this reason they became known to each other. In October 2014, VAL acquired Lonzim Hotels from Cambria (further details aresetoutinparagraph4(ii)ofPartII ofthe Circular).
Neither VAL nor its concert parties currently hold any Shares in the Company.
Intentions of VAL
The Company's investment objective is to provide Shareholders with long term capital appreciation through the investment of its capital in Zimbabwe, countries surrounding Zimbabwe, as well as the remainder of Sub-Saharan Africa, with a bias towards Southern and Eastern Africa, which is aligned to the investment objective of VAL. 
The Company's investments include: 
 Payserv Africa Limited, which provides EDI switching services (Paynet), 'payslip' processing (Autopay), and payroll based microfinance loan processing (Tradanet) in Zimbabwe and, more recently, in Zambia. 
 Millchem Holdings Limited, which is a value-added chemicals distributor with leading market positions in Zimbabwe. It recently established a presence in Zambia and Malawi.
VALintendsthat, following theissueof theSubscription Shares, the investment strategy of the Companywillbecontinuedinthesamemannerasatpresent, except for theproposed changes totheBoard. 
In particular, VAL has confirmed that it has no current intention to change the Company's current plans with respect to:
 the continued employment of the employees and management of the Company or its subsidiaries, including any material change in conditions of employment;
 its strategic plans for the Company, or their likely repercussions on employment or the locations of the Company's places of business;
 employer contributions into any pension scheme(s), the accrual of benefits for existing members, or the admission of new members;
 the redeployment of the fixed assets of the Company; or
 maintenance of the Company's listing on AIM.
Cambria'sbusinessandprospects
As outlined in the Circular published on 23 January 2015, Cambria activities have been constrained by a number of factors which are expected to be addressed by the investment of VAL in the Company. In particular, slower than anticipated growth of the Zimbabwean economy and the sale of the Leopard Rock Hotel at a price well below expectations.
The proceeds of the placement will be used to provide working capital for the Company's existing investments, primarily Payserv Africa Limited and Millchem Holdings Limited, which will benefit from further investment to sustain growth. 
The Company is temporarily suspended from trading on AIM , pending the publication of its Annual Accounts for the year ending 31 August 2014. The Annual Accounts have not yet been prepared as the Company had intended to de-list from AIM. The Company's interim financial report for 2014 and Annual Accounts for the year ending 31 August 2013, are available for inspection on the Company's website, www.cambriaafrica.com/investors/financial-reports.
ProposedBoard changes
Asdetailedabove,the SubscriptionAgreementprovidedforcertainchangesto theBoard to takeplaceon or from Completion.
Asaresult, on Completion, Messrs. Paul Turner,Itai MazaiwanaandFred Joneswillresign fromtheBoard and VAL shall be entitled to nominate 3 additional Directors, subject to due diligence compliance for directors of an AIM listed company. VAL has nominated Mr. Santosh K. Gujadhur as its first nominated Director. The Companytakesthisopportunitytothank Messrs. Paul Turner,Itai Mazaiwanaand Fred Jones who havemadeavaluablecontribution totheCompanyduringa difficult time. On Completion, the Board will consist of Mr. Perkins (non-executive Chairman), Mr. Wisman (CEO) and Mr. Gujadhur (non-executive Director). Mr.Gujadhur's appointment is subject to satisfying the NOMAD's standard due diligence enquiries for directors of an AIM listed company. 
Trading in theSubscription Shares
The Company is temporarily suspended from trading on AIM, pending the publication of its Annual Accounts for the year ending 31 August 2014, which is unlikely to occur before the end of May 2015. Once the Company's suspension has been lifted, and subject to Completion, an application willbemade for theadmissionoftheSubscription Shares to tradingonAIM. 
Extraordinary GeneralMeeting
Youwillfindsetouton page 18ofthe CircularanoticeconveningtheEGMfor 9.00a.m.on 13 April 2015(orsuchlatertime). TheWhitewashResolution willbedecided by meansofapoll.
Actionto betaken
Aform ofproxy foruse inconnectionwith theEGM isenclosed. Whetherornot youintend toattend the EGM, it is important,particularly inviewofthefact that theWhitewash Resolutiontobeput to themeeting willbedetermined by apoll, thatyou duly complete,executeandreturntheenclosedForm ofProxy,byhandorbypost,to the Company's registrars, Capita Registrars (Isle of Man) Limited, Clinch's House, Lord Street, Douglas, Isle of Man, IM99 1RZ, inaccordance with the instructionsprintedthereon. To bevalid,thecompletedformofproxymustbereturnedassoonaspossibleand,inanyevent,soastoarrive
nolater than9.00a.m.on9 April 2015. 
CompletionandreturnofaFormofProxywillnot preventShareholdersfromattending andvoting attheExtraordinary GeneralMeeting inperson shouldthey wish to do so andsolongas theyarenototherwiseprevented fromso doing.
Furtherinformation
Your attention is drawn toPart IIof the Circularwhich contains furtherinformation relatingto VAL and Cambria.
Recommendation
TheDirectors,whohavebeensoadvisedby Peterhouse,consider thattheWaiver and theissue oftheSubscriptionSharesarefairandreasonableandareinthebestinterestsoftheCompanyand
Shareholdersasawhole.InadvisingtheDirectors,PeterhousehastakenintoaccounttheDirectors'
commercial assessments.
Accordingly, the Board unanimously recommends Shareholders to vote in favour of the Resolutions to be proposed as they intend to do in respect of their own beneficial holdings which equates to 2.8% of the Issued Share Capital of the Company.
Yours faithfully,
IAN PERKINS
Non-executive Chairman 



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