Ma­jor re­struc­tur­ing for Dis­tell

The Star Early Edition - - BUSINESS REPORT - Roy Cokayne

LISTED lo­cal drinks maker Dis­tell Group plans to un­der­take a ma­jor re­struc­tur­ing of its multi-tiered own­er­ship struc­ture to a clearer and sim­pler share­hold­ing struc­ture.

The group said yes­ter­day that the pro­posed re­struc­tur­ing would leave Dis­tell share­hold­ers with ex­actly the same eco­nomic in­ter­est in the new Dis­tell and in­crease the free float in the new Dis­tell on the JSE.

It said it would also re­sult in the con­trol of the new Dis­tell vest­ing in Rem­gro through one or more of its sub­sidiaries through the is­sue of un­listed vot­ing B-shares in the new Dis­tell to Rem­gro.

Dis­tell said the pro­posed re­struc­tur­ing had the sup­port of the Pub­lic In­vest­ment Cor­po­ra­tion (PIC) and Coro­na­tion As­set Man­age­ment act­ing on be­half of its clients.

The PIC has a 27.7 per­cent in­ter­est in Dis­tell and Coro­na­tion 2.7 per­cent.

Rem­gro and Capevin each hold 50 per­cent of the share­hold­ing in Rem­gro-Capevin In­vest­ments, which owns a 52.8 per­cent di­rect in­ter­est in Dis­tell.

Dis­tell said Rem­gro was also sup­port­ive of the pro­posed re­struc­tur­ing but would not be en­ti­tled to vote on it.

It said the trans­ac­tion would, among other things, re­sult in the elim­i­na­tion of the cur­rent multi-tiered own­er­ship struc­ture of the group, leav­ing a sin­gle en­try point in Dis­tell.

The trans­ac­tion was also likely to im­prove the de­mand, liq­uid­ity and mar­ketabil­ity of the new Dis­tell shares; sim­plify Dis­tell’s cap­i­tal struc­ture, which was likely to im­prove Dis­tell’s in­vest­ment ap­peal to both for­eign and lo­cal in­vestors; and re­sult in an in­creased free float of new Dis­tell or­di­nary

Pub­lic In­vest­ment Cor­po­ra­tion in­ter­est in Dis­tell

shares and en­hance its weight­ing in stock mar­ket in­dices on both the JSE and in­ter­na­tion­ally.

The group said the pro­posed trans­ac­tion would also sim­plify Dis­tell’s abil­ity to raise cap­i­tal if re­quired to sup­port its longterm growth strat­egy and re­tain the sta­bil­ity and con­ti­nu­ity of Rem­gro re­main­ing an an­chor share­holder in Dis­tell.

In terms of the pro­posed re­struc­tur­ing, Dis­tell will be­come a wholly-owned sub­sidiary of New Dis­tell and be delisted from the JSE, with Capevin also be delisted as part of the Capevin scheme.

But the new Dis­tell list­ing will en­sure that Dis­tell share­hold­ers were able to trade their new Dis­tell shares on the main board of the JSE as they could in the past.

The eco­nomic rights of Dis­tell share­hold­ers will not be di­luted by the is­sue of B-shares but their vot­ing rights will be di­luted by 35.8 per­cent af­ter the im­ple­men­ta­tion of the pro­posed trans­ac­tion.

The pro­posed trans­ac­tion is sub­ject to the ful­fil­ment of a num­ber of con­di­tions prece­dent, in­clud­ing the ap­proval of Dis­tell share­hold­ers and the JSE.

The scheme meet­ing at which share­hold­ers would vote on the pro­posed re­struc­tur­ing will take place in Stel­len­bosch on Septem­ber 1.

Sub­ject to the ap­proval of the scheme, trad­ing in Dis­tell shares was ex­pected to be sus­pended on the JSE on Oc­to­ber 11 and Dis­tell’s list­ing ter­mi­nated on Oc­to­ber 19.

Dis­tell has re­vealed plans for a clearer and sim­pler share­hold­ing struc­ture.

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