17 May 2013

Firm Intention to make an Offer to Acquire Altech Minority Shareholders

ALLIED TECHNOLOGIES LIMITED
Incorporated in the Republic of South Africa
Registration number 1946/020415/06
Share code ALT
ISIN: ZAE000015251
("Altech")

ANNOUNCEMENT OF A FIRM INTENTION TO MAKE AN OFFER TO ACQUIRE THE
ENTIRE ISSUED ORDINARY SHARE CAPITAL OF ALTECH THAT ALLLIED
ELECTRONICS CORPORATION LIMITED ("ALTRON") DOES NOT ALREADY OWN
AND WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT

1. INTRODUCTION

Shareholders of Altech are advised that the Altech board of directors ("Altech Board") have
received a firm intention to make an offer from Altron, through its wholly-owned subsidiary
Altron Finance Proprietary Limited, to acquire the entire issued ordinary share capital of Altech
that Altron and its subsidiaries do not already own, by way of a scheme of arrangement
("Scheme") in terms of section 114 of the Companies Act 71 of 2008 (the "Companies Act").

Altech shareholders are referred to the firm intention announcement and withdrawal of
cautionary announcement released on the Securities Exchange News Service ("SENS") of the
JSE Limited by Altron today, 17 May 2013, ("Altron Firm Intention Announcement") in which
full details of the Scheme were disclosed.

2. THE ALTRON FIRM INTENTION ANNOUNCEMENT

The content of the Altron Firm Intention Announcement, without modification, is set out
hereunder.

1. "INTRODUCTION

Shareholders of Altron are referred to the cautionary announcement released on the
Securities Exchange News Service ("SENS") of the JSE Limited ("the JSE") on 22 March
2013 and subsequent renewal of the cautionary announcement on 7 May 2013. The board
of directors of Altron is pleased to announce that Altron has made an offer, through its
wholly-owned subsidiary Altron Finance Proprietary Limited ("Alfin"), to acquire the entire
issued ordinary share capital of Altech that Altron and its subsidiaries (the "Altron Group")
do not already own ("Altech Share(s)"), by way of a scheme of arrangement ("Scheme")
in terms of section 114 of the Companies Act 71 of 2008 (the "Companies Act"), to be
proposed by the board of directors of Altech ("Altech Board") between Altech and the
holders of Altech Shares ("Altech Shareholder(s)").

2. PURCHASE CONSIDERATION

The consideration payable by Altron to Altech Shareholders in terms of the Scheme (the
"Scheme Consideration") will be settled as to:

2.1. R47.50 in cash for every Altech Share reflected on the Scheme consideration record
date ("Cash Consideration"); alternatively
2.2. Altech Shareholders may elect to receive all, or part of the Scheme Consideration in
the form of Altron participating preference shares ("Altron Share(s)") in the ratio of
2.22 Altron Shares per Altech Share ("Switch Ratio") held by them ("Share
Consideration");

provided further that the aggregate Share Consideration will be limited to a maximum of
50% of the aggregate Scheme Consideration ("Share Consideration Limitation").

In the event that Altech Shareholders in aggregate elect to receive the Share
Consideration in excess of the Share Consideration Limitation, such excess will be paid in
the form of the Cash Consideration and the calculation of the Share Consideration
component of the Scheme Consideration will be based on the formula set out below:

A= B/C x D

Where:

The Share Consideration received by an Altech Shareholder, in the event that
A= Altech Shareholders in aggregate elect to receive the Share Consideration in
excess of the Share Consideration Limitation

B= The number of Altron Shares that comprise the Share Consideration Limitation

C= The aggregate Share Consideration elected by Altech Shareholders

D= The Share Consideration elected by an Altech Shareholder

Altech Shareholders who do not make a valid election in terms of the Scheme will be
deemed to have elected to receive the Cash Consideration in respect of 100% of their
Altech Shares.

No fractions will be issued and any fraction of Altron Shares to which any Altech
Shareholder is entitled after the conversion of all of the Altech Shares held by such Altech
Shareholder will, if it comprises 0.5 or more of an Altron Share be rounded up, otherwise
will be rounded down to the nearest whole Altron Share.

The Cash Consideration and Share Consideration represent a premium of:

• 31.1% to the volume weighted average price ("VWAP") of Altech Shares traded on the
securities exchange operated by the JSE over the 30 business days up to the date on
which the first cautionary announcement was released on SENS, being 22 March 2013
(the "Cautionary Date")

3. RATIONALE FOR THE SCHEME

The Proposed Transaction will inter alia:
- create a single listed point of entry into the Altron Group;
- simplify the corporate and operating structure of the Altron Group; and
- enable the maximisation of synergies within the Altron Group.

4. CONDITION PRECEDENT TO THE POSTING OF THE SCHEME CIRCULAR TO
ALTECH SHAREHOLDERS

The posting of the circular to Altech Shareholders in relation to the Scheme ("Scheme
Circular") is subject to the fulfilment of the following condition precedent, namely the
requisite approvals being received from the JSE, the Takeover Regulation Panel ("TRP")
and the South African Reserve Bank ("SARB") for the posting of the Scheme Circular. This
condition is of a regulatory nature and cannot be waived.

5. CONDITIONS PRECEDENT TO THE SCHEME

5.1. The Scheme will be subject to the fulfilment or waiver (in whole or in part) by Altron,
of the following conditions precedent by 16 August 2013 or such later date as Altron
and Altech may agree to in writing:

5.1.1. to the extent required, the requisite majority of the shareholders of Altron
("Altron Shareholder(s)") approving the relevant resolutions required to
implement the Proposed Transaction or incidental thereto, in terms of the
Companies Act and the Listings Requirements of the JSE ("JSE Listings
Requirements");

5.1.2. the listing of the Altron Shares for the purpose of settling the Share
Consideration being approved by the JSE;

5.1.3. the approval of the Scheme by the requisite majority of Altech Shareholders,
as contemplated in section 115(2) of the Companies Act, and:

5.1.3.1. to the extent required, the approval of the implementation of such
resolution by the court as contemplated in section 115(3)(a) of the
Companies Act; and

5.1.3.2. if applicable, Altech not treating the aforesaid resolution as a nullity,
as contemplated in section 115(5)(b) of the Companies Act;

5.1.4. Altech Shareholders not having exercised appraisal rights by giving valid
demands to this effect to Altech, in terms of section 164(7) of the Companies
Act, in respect of more than 5% of the Altech Shares within 30 business days
following the Altech Shareholders meeting convened to approve the Scheme
("Scheme Meeting"), provided that, in the event that any Altech
Shareholders give notice objecting to the Scheme, as contemplated in
section 164(3) of the Companies Act, and those Altech Shareholders vote
against the resolution proposed at the Scheme Meeting to approve the
Scheme, but do so in respect of no more than 5% of the Altech Shares, this
condition shall be deemed to have been fulfilled at the time of the Scheme
Meeting; and

5.1.5. by the date on which each of the abovementioned conditions are fulfilled or
waived (as the case may be), an adverse effect, fact, circumstance which is
or might reasonably be expected (alone or together with any other such
adverse effect, fact or circumstance) to be material with regard to the
operations, continued existence, business, condition, assets and liabilities of
Altech and its subsidiaries (whether as a consequence of the Scheme or not)
has not occurred. For the purposes of this clause, to be material, the adverse
effect, fact or circumstance must:
- constitute a change in the laws of the Republic of South Africa (including,
without limitation, laws relating to taxation) which has (or may reasonably
be expected to have) a material adverse effect upon the Scheme such
that the effective direct or indirect cost of the Scheme to Altron, including
but not limited to the Scheme Consideration would increase by 15% or
more.

5.2. The conditions precedent other than of a regulatory nature are stipulated for the
benefit of Altron and may be waived by Altron in its sole discretion by notice in
writing to Altech. Conditions that are of a regulatory nature cannot be waived.

6. PRO FORMA EARNINGS AND NET ASSET VALUE EFFECTS PERTAINING TO THE
SCHEME

6.1. Altron

The unaudited and unreviewed pro forma financial effects of the Scheme on Altron
Shareholders, for which the directors of Altron are responsible, are provided for
illustrative purposes only to provide information about how the Scheme will affect the
financial position of the Altron Shareholders by illustrating the effect thereof on the
basic earnings per share ("Basic EPS") and diluted basic earnings per share
("Diluted Basic EPS") for continuing operations, discontinued operations and total
operations and headline earnings per share ("HEPS") and diluted headline earnings
per share ("Diluted HEPS") for total operations of Altron as if the Scheme had
become operative on 1 March 2012, and, for the purpose of net asset value per
share ("NAVPS") and net tangible asset value per share ("NTAVPS") of Altron, as if
the Scheme had become operative on 28 February 2013. Because of their nature
the unaudited and unreviewed pro forma financial effects may not give a fair
presentation of Altron's financial position, changes in equity, results of operations
and performance after the Scheme. The unaudited and unreviewed pro forma
financial effects have been compiled using accounting policies that comply with
International Financial Reporting Standards ("IFRS") and that are consistent with
those applied in the audited consolidated financial statements of Altron for the
twelve months ended 28 February 2013. There are no post balance sheet events
which require adjustment to the pro forma financial effects.

Before the After the Change
Scheme Scheme %
(Note 1) (Note 2)
Continuing operations
Basic EPS (cents) 158 164 4%
Diluted Basic EPS (cents) 153 159 4%
Discontinued operations
Basic EPS (cents) (252) (362) (44%)
Diluted Basic EPS (cents) (239) (350) (47%)
Total operations
Basic EPS (cents) (94) (198) (110%)
Diluted Basic EPS (cents) (86) (191) (123%)
HEPS (cents) 136 135 (1%)
Diluted HEPS (cents) 133 130 (2%)
Net asset value per share (cents) 1,498 1,157 (23%)
Tangible net asset value per share
(cents) 988 707 (28%)

Weighted average number of shares in
316 358 13%
issue ('000)
Diluted average number of shares in
319 370 16%
issue ('000)
Number of shares in issue ('000) 317 358 13%

Notes:

1. The financial information in the "Before the Scheme" column has been prepared based
on Altron's audited financial results for the twelve months ended 28 February 2013. In
terms of IFRS, Altron already exercises control over Altech by virtue of its shareholding in
Altech. Consequently, Altech's results are consolidated into Altron's statement of
comprehensive income and balance sheet.
2. The financial information included in the "After the Scheme" column has been prepared
based on Altron's audited financial results for the twelve months ended 28 February
2013, taking into account the following:
2.1 The Scheme Consideration elected by Altech Shareholders is assumed to comprise
of 50% Cash Consideration and 50% Share Consideration. The Cash Consideration
is funded by debt of R894.0 million and the Share Consideration by the issue of 41.9
million new Altron Shares (increasing both weighted average and diluted average
number of shares in issue) to the value of R894.0 million (based on Altron's 30 day
VWAP up to the Cautionary Date);

2.2 An after tax debt funding rate of 5.46% has been used. Debt funding is assumed to
be repayable over five years;
2.3 Assumed once-off transaction costs for Altron and Altech amounting to R18.0 million
have been capitalised in accordance with IFRS. These amounts will be paid out of
available cash resources and are attributable to the various professional advisers,
issuers of debt, regulatory authorities and printing costs;
2.4 In terms of the requirements of IFRS and based on Altron management's best
estimate at the date of this Firm Intention Announcement, the excess of the Scheme
Consideration paid to Altech Shareholders over the net asset value of Altech to be
acquired, amounting to R1,469.0 million at 28 February 2013, has been deducted
directly from equity; and

2.5 There are no post balance sheet events which require adjustment of the pro forma
financial effects.
2.6 All adjustments, with the exception of transaction costs, are expected to have a
continuing effect.

6.2. Altech

6.2.1. The financial effects for Altech Shareholders who elect to receive the Cash
Consideration are presented below:

Cash Consideration Before the After the Change
Scheme Scheme %
30 day VWAP (cents) (Note 1) 3622 4750 31%
Closing price (cents) (Note 2) 3439 4750 38%
Notes:

1. The 30 day VWAP of an Altech Share traded on the JSE up to the Cautionary
Date.

2. The closing price of an Altech Share traded on the JSE as at 16 May 2013, being
the last business day immediately prior to the date of this Firm Intention
Announcement.

6.2.2. The financial effects for Altech Shareholders who elect to receive the Share
Consideration are presented below:

In terms of IFRS, Altron exercises control over Altech by virtue of its
shareholding in Altech. Consequently, Altech's results are consolidated into
Altron's statement of comprehensive income and balance sheet. The
unaudited and unreviewed pro forma financial effects of the Scheme on
Altech Shareholders, for which the Altron Board is responsible, are provided
for illustrative purposes only to provide information about how the Scheme
will affect the financial position of the Altech Shareholders who elect the
Share Consideration, assuming that the Scheme Consideration is settled as
to 50% Cash Consideration and 50% Share Consideration, by illustrating the
effect thereof on the Basic EPS and Diluted Basic EPS for continuing
operations, discontinued operations and total operations and HEPS and
Diluted HEPS for total operations, of the Altech Shares exchanged for Altron
Shares at the Switch Ratio, as if the Scheme had become operative on 1
March 2012, and, for the purpose of NAVPS and NTAVPS as if the Scheme
had become operative on 28 February 2013. These pro forma financial
effects are based on the twelve month audited financial results for Altech to
28 February 2013. Because of their nature the unaudited and unreviewed pro
forma financial effects may not give a fair presentation of Altech
Shareholders' financial position and performance following the
implementation of the Scheme. There are no post balance sheet events
which require adjustment to the pro forma financial effects.

Share Consideration Before the After the Change
Scheme Scheme %
(Note 3) (Note 4)
Continuing operations
Basic EPS (cents) 369 365 (1%)
Diluted Basic EPS (cents) 353 353 0%
Discontinued operations
Basic EPS (cents) (1,330) (805) 39%
Diluted Basic EPS (cents) (1,273) (779) 39%
Total operations
Basic EPS (cents) (961) (440) 54%
Diluted Basic EPS (cents) (920) (426) 54%
HEPS (cents) 268 300 12%
Diluted HEPS (cents) 256 290 13%

Net asset value per share
849 2,570 203%
(cents)
Tangible net asset value per
409 1,571 284%
share (cents)

Weighted average number
98 358 n/a
of shares in issue ('000)
Diluted average number of
102 370 n/a
shares in issue ('000)
Number of shares in issue
('000) 98 358 n/a

Notes:

3. The financial information in the "Before the Scheme" column has been prepared
based on Altech's audited financial results for the twelve months ended 28
February 2013.
4. The financial information included in the "After the Scheme" column has been
derived by taking the "After the Scheme" financial effects for Altron, as illustrated
in paragraph 6.1 above, and multiplying these results by the Switch Ratio to
provide the pro forma financial effects for those Altech Shareholders who elect
the Share Consideration. Once-off transaction costs incurred will be paid out of
available cash resources.

7. SHAREHOLDER UNDERTAKINGS

Altron has received irrevocable undertakings and letters of support from certain Altech
Shareholders who, at the date of this Firm Intention Announcement, hold between them
22,241,909 Altech Shares, to vote in favour of the Scheme and the resolutions to be
proposed at the Scheme Meeting, representing in aggregate approximately 59.1% of the
Altech Shareholders entitled to vote at the Scheme Meeting.

8. GUARANTEES AND CONFIRMATIONS TO THE TAKEOVER REGULATION PANEL

Altron has delivered an irrevocable and unconditional bank guarantee from ABSA Bank
Limited to the TRP in compliance with regulations 111(4) and 111(5) of the Takeover
Regulations in terms of the Companies Act ("Takeover Regulations"). The aggregate
amount of the bank guarantee is sufficient for the purpose of fully satisfying the Cash
Consideration.

Altron has confirmed to the TRP that it has sufficient authorised and unissued Altron
participating preference shares available in order to issue new Altron Shares which may
be required to fully satisfy the Share Consideration.

9. TERMINATION OF THE ALTECH LISTING

Following implementation of the Scheme, application will be made to the JSE to terminate
the listing of Altech Shares on the JSE.

10. SHAREHOLDINGS IN ALTECH AND ACTING AS PRINCIPAL

Altron confirms that the Altron Group, through Alfin, is the ultimate proposed purchaser of
all the Altech Shares and that it is acting alone and not in concert with, or as agent or
broker for, any other party.
Altron is the beneficial owner of 59,927,685 Altech ordinary shares, comprising
approximately 61.4% of the ordinary share capital of Altech (excluding treasury shares).

11. DOCUMENTATION

Further details of the Scheme will be included in the Scheme Circular to be sent to Altech
Shareholders, containing, inter alia, a notice of the meeting of Altech Shareholders, a form
of proxy and a form of surrender and transfer. The Scheme Circular is expected to be
posted to Altech Shareholders on or about 14 June 2013. The salient dates in relation to
the Scheme will be published prior to the posting of the Scheme Circular.

The Proposed Transaction will constitute a Category 1 transaction in terms of the JSE
Listings Requirements. Accordingly, a circular containing full details of the Proposed
Transaction and a notice of general meeting of Altron Shareholders will be posted in due
course. The general meeting will provide Altron Shareholders with the opportunity to
consider and, if deemed fit, pass, with or without modification, the ordinary resolutions
required to approve and implement the Proposed Transaction and matters ancillary thereto

12. WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT

Following the release of this Firm Intention Announcement, the cautionary announcement
originally published by Altron on 22 March 2013 and renewal of cautionary announcement
on 7 May 2013 are hereby withdrawn and caution is no longer required to be exercised by
Altron Shareholders when dealing in their shares.

13. ALTRON RESPONSIBILITY STATEMENT

Altron's board of directors accepts responsibility for the information contained in this Firm
Intention Announcement to the extent that it relates to Altron. To the best of its knowledge
and belief, the information contained in this Firm Intention Announcement is true and
nothing has been omitted which is likely to affect the import of the information."

3. RECOMMENDATION AND FAIRNESS OPINION

The Altech independent board, to be constituted in terms of the Takeover Regulations ("Altech
Independent Board"), will appoint an independent expert as required in terms of section
114(3) of the Companies Act and the Takeover Regulations (the "Independent Expert"), to
provide it with external advice in relation to the Scheme and to make appropriate
recommendations to the Altech Independent Board in the form of a fair and reasonable opinion.

The substance of the external advice received from the Independent Expert and the views of
the Altech Independent Board will be detailed in the Scheme Circular.

4. ALTECH RESPONSIBILITY STATEMENT

The Altech Board accepts responsibility for the information contained in this announcement to
the extent that it relates to Altech. To the best of their knowledge and belief, the information
contained in this announcement is true and nothing has been omitted which is likely to affect
the import of the information

5. CAUTIONARY ANNOUNCEMENT
Following the release of this announcement, the cautionary announcement originally published
by Altech on 22 March 2013 and renewal of cautionary announcement on 7 May 2013 are
hereby withdrawn and caution is no longer required to be exercised by Altech Shareholders
when dealing in Altech shares.

Johannesburg
17 May 2013

Investment Bank and advisor to the transaction
Investec Bank Limited

Sponsor
Investec Bank Limited

Date: 17/05/2013 04:10:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
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