Following its announcement of 16th November, 2015 advising the investing public that Tiger Brands had decided not to provide further financial support with respect to its investment in the Company, Tiger Branded Consumer Goods Plc (“TBCG”) has notified The Exchange that Tiger Brands and Dangote Industries Limited (“DIL”) (collectively, “The Parties”) have reached an agreement regarding the terms of a transaction that will ensure that TBCG is maintained as a viable going concern able to retain its employees and meet its obligations to its stakeholders. The Transaction envisages that sufficient capital will be injected into TBCG in order to stabilise the business and place it on a sustainable path aimed at creating value for its stakeholders.
Subject to regulatory approvals, DIL will provide TBCG with an immediate cash injection of N10 billion. In return, Tiger Brands will divest its 65.7% shareholding in TBCG to DIL for a nominal consideration and write off its shareholder loans to TBCG. In addition, Tiger Brands will assume and settle outstanding debt guaranteed on behalf of TBCG.
The former directors of TBCG – Messrs Olakunle Alake, Arnold Ekpe and Asue Ighodalo – have agreed to re-join the board of TBCG and have consequently been reappointed with effect from 10th December, 2015 The terms of the Transaction will be set out in a Share Sale and Purchase Agreement (SSPA), which the Parties will enter into. The Transaction and its terms have to be considered and approved by the Securities and Exchange Commission (“SEC”), in accordance with regulatory requirements.
The Parties will, as soon as is practicable, submit details of the Transaction and the SSPA to SEC for approval. Apart from the approval of the SEC, implementation of the Transaction will also be subject to the fulfilment of certain conditions precedent, including approval of the Exchange Control Division of the South African Reserve Bank. A further announcement will be released upon implementation of the Transaction.