WHL: WOOLWORTHS HOLDINGS LIMITED - Declaration information in relation to a renounceable rights offer of R10 billion and cautionary announcement Declaration information in relation to a renounceable rights offer of R10 billion and cautionary announcement WOOLWORTHS HOLDINGS LIMITED (Incorporated in the Republic of South Africa) Registration number 1929/001986/06 Share code: WHL ISIN: ZAE000063863 ("WHL" or the "Company" or the "Group") NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, CANADA AND JAPAN, OR ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF APPLICABLE LAW OR REGULATION DECLARATION INFORMATION RELATING TO A RENOUNCEABLE RIGHTS OFFER OF R10 BILLION AND CAUTIONARY ANNOUNCEMENT 1. INTRODUCTION Shareholders of WHL ("Shareholders") are referred to the announcements released on the Stock Exchange News Service ("SENS") of the JSE Limited ("JSE") on Wednesday, 9 April 2014 and Friday, 16 May 2014, relating to the acquisition by WHL of the entire issued share capital of David Jones Limited ("David Jones") ("the Acquisition"). Shareholders are further referred to the announcement released on SENS on Tuesday, 17 June 2014 relating to the approval by the requisite majority of Shareholders of all the resolutions proposed at a general meeting of Shareholders held on Tuesday, 17 June 2014 relating to the Acquisition. For purposes of the Acquisition, an unsecured syndicated facility agreement was entered into by WHL and Woolworths Proprietary Limited with, among others, Citibank, N.A., London Branch, J.P. Morgan Limited and The Standard Bank of South Africa Limited (as mandated lead arrangers and bookrunners) and Citibank, N.A., South Africa Branch, JPMorgan Chase Bank, N.A., Johannesburg Branch and The Standard Bank of South Africa Limited (as underwriters and lenders) for the provision of a short-term equity bridge facility in a principal amount of up to R11 billion ("the Equity Bridge Facility"). The board of directors of WHL (the "Board") is pleased to announce that the Company intends to raise a gross total of R10 billion through a fully underwritten renounceable rights offer ("the Rights Offer") for purposes of repaying the Equity Bridge Facility, subject to the satisfaction of the conditions precedent set out in paragraph 3 below. A further announcement setting out the full terms and finalisation information of the Rights Offer will be released on or about Tuesday, 2 September 2014. 2. RATIONALE AND APPLICATION OF PROCEEDS The Acquisition, completed on 1 August 2014, is part of WHL´s strategy to further expand its international operations in order to transform itself into a leading southern hemisphere fashion retailer with sufficient scale to compete effectively with global apparel retailers. The combination of WHL and David Jones (the "Enlarged Group") provides significant advantages that will benefit both companies and their customers. The Enlarged Group will have increased scale that will drive significant efficiencies through enhanced global sourcing and the ability to leverage common seasonality and fashion trends, improving value for the customer and overall profitability. The Acquisition was completed for A$2.15 billion* (R21.6 billion) in cash and was funded using: - A$993 million (R10.0 billion) from the Group's cash holdings; - A$891 million (R9.0 billion) from the Equity Bridge Facility (excluding transaction costs), which will be repaid with the proceeds from the Rights Offer; and - A$264 million (R2.7 billion) from the senior syndicated facility made available by Commonwealth Bank of Australia, National Australia Bank Limited and Westpac Banking Corporation ("the Australian Senior Facility"). * All A$ figures have been converted at the R/A$ exchange rate of 10.0675 In light of the foregoing and the Enlarged Group´s capital structure, the Board has formed the view that it is prudent to raise equity capital from Qualifying Shareholders (WHL ordinary shareholders registered in the WHL share register on the Record Date (as specified below), excluding holders of treasury shares and WHL´s American Depository Receipts, and who do not have their registered address in any jurisdiction in which it would be unlawful to make the Rights Offer) in order to repay the Equity Bridge Facility used to fund the Acquisition. In reaching this view, the Board has given due consideration to the continued implementation of the Enlarged Group´s strategy. 3. CONDITIONS PRECEDENT The implementation of the Rights Offer is subject to the fulfilment of the following conditions precedent: - approval by the JSE of the circular relating to the Rights Offer ("the Rights Offer Circular"); - approval by the JSE of the application for the listing of the Letters of Allocation envisaged in terms of the Rights Offer and of the application for listing of any Rights Offer shares required for implementation of the Rights Offer on the JSE; and - any other relevant approvals required by the JSE. 4. SALIENT DATES AND TIMES OF THE RIGHTS OFFER Subject to the fulfilment of the conditions precedent as set out in paragraph 3 above, the proposed salient dates and times for the Rights Offer are set out below: 2014 Finalisation announcement released on SENS Tuesday, 2 September Last day to trade in WHL ordinary shares in order to participate Friday, 5 September in the Rights Offer (cum rights) WHL ordinary shares commence trading ex-rights at 09:00 on Monday, 8 September Listing of and trading in the Letters of Allocation on the Monday, 8 September exchange operated by the JSE commences at 09:00 on Rights Offer Circular and form of instruction posted to Tuesday, 9 September certificated Qualifying Shareholders Record Date for the Rights Offer Friday, 12 September Rights Offer opens at 09:00 on Monday, 15 September Letters of Allocation credited to an electronic account held at the Monday, 15 September Computershare Investor Services Proprietary Limited (the "Transfer Secretaries") in respect of certificated Qualifying Shareholders CSDP or broker accounts credited with rights in respect of Monday, 15 September dematerialised Qualifying Shareholders Rights Offer Circular and Form of Instruction, where applicable, Tuesday, 16 September posted to dematerialised Qualifying Shareholders Last day for trading Letters of Allocation on the exchange Thursday, 18 September operated by the JSE Listing of Rights Offer shares and trading therein on the Friday, 19 September exchange operated by the JSE commences at 09:00 on Payment to be made and Form of Instruction to be lodged with Friday, 26 September the Transfer Secretaries by certificated Qualifying Shareholders by 12:00 on Rights Offer closes at 12:00 on Friday, 26 September Record Date for the Letters of Allocation Friday, 26 September Rights Offer shares issued on or about Monday, 29 September Entitlement in respect of subscriptions for Rights Offer shares Monday, 29 September available from Central Securities Depository Participant´s ("CSDP") or Broker Monday, 29 September accounts of dematerialised Qualifying Shareholders credited/debited and updated with Rights Offer shares Share certificates posted to certificated Qualifying Shareholders Monday, 29 September by registered post on or about Results of the Rights Offer and basis of allocation of excess Monday, 29 September Rights Offer shares announced on SENS Results of the Rights Offer and basis of allocation of excess Tuesday, 30 September Rights Offer shares published in the South African press Rights Offer shares in respect of successful excess applications Wednesday, 1 October (if applicable) issued on or about CSDP or broker accounts of dematerialised Qualifying Wednesday, 1 October Shareholders credited/debited and updated with Rights Offer shares in respect of successful excess applications (if applicable) Share certificates in respect of successful excess applications (if Wednesday, 1 October applicable) posted to certificated Qualifying Shareholders by registered post on or about Refund cheques posted to certificated Qualifying Shareholders Thursday, 2 October in respect of unsuccessful excess applications (if applicable) on or about Notes: 1. Share certificates in respect of WHL ordinary shares may not be dematerialised or re-materialised between Monday, 8 September 2014 and Friday, 12 September 2014, both days inclusive. 2. CSDP effect payment on a delivery versus payment basis in respect of dematerialised Shares. 3. Dematerialised Qualifying Shareholders are required to inform their CSDP or brokers of their instructions in terms of the Rights Offer in the manner and time stipulated in the agreement governing the relationship between the Qualifying Shareholder and their CSDP or Broker. Dematerialised Qualifying Shareholders are advised to contact their CSDP or broker as early as possible to establish what the cut-off dates and times are for acceptance of the Rights Offer, as set out in the custody agreement, as this may be earlier than the proposed closing time of the Rights Offer. 4. Any changes to the dates and times will be announced on SENS and in the press. 5. All times are South African Standard time. 5. CAUTIONARY ANNOUNCEMENT Shareholders are advised that the final terms, and pro forma financial effects, of the Rights Offer will be announced in due course. Shareholders are accordingly advised to exercise caution when dealing in the Company's securities until a further announcement regarding the Rights Offer is made. Cape Town 29 August 2014 Investor contacts: WHL Ralph Buddle Head of Corporate Finance and Investor Relations T: +21 27 407 3250 M: + 27 83 412 4923 Joint Bookrunners and Underwriters Citigroup Global Markets Limited ("Citi") J.P. Morgan Securities plc ("J.P. Morgan") The Standard Bank of South Africa Limited ("Standard Bank") Transaction Sponsor to WHL: Standard Bank Lead Independent Sponsor to WHL: Rand Merchant Bank (a division of FirstRand Bank Limited) Legal advisers to WHL Linklaters LLP Webber Wentzel Gilbert + Tobin Legal advisers to the Joint Bookrunners Latham & Watkins (London) LLP Bowman Gilfillan Inc. Financial Adviser Rothschild NOTICE TO RECIPIENTS This announcement is not for distribution, directly or indirectly, in or into the United States (including its territories and dependencies, any State of the United States and the District of Columbia), Canada and Japan. This announcement includes certain "forward-looking statements" that reflect the current views or expectations of the Board with respect to future events and financial and operational performance. All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements, including, without limitation, those concerning: the Group's strategy; the economic outlook for the industry; use of the proceeds of the Rights Offer; the Group´s ability to successfully integrate the operations of David Jones and recognise expected synergies; future operating results; growth prospects; and the Enlarged Group's liquidity and capital resources and expenditure. These forward-looking statements are not based on historical facts, but rather reflect the Group's current plans, estimates, projections and expectations concerning future results and events and generally may be identified by the use of forward-looking words or phrases such as "believe", "expect", "anticipate", "intend", "should", "planned", "may", "potential" or similar words and phrases. This announcement does not constitute an offer of, or an invitation to purchase, any securities of the Company in any jurisdiction. This announcement does not constitute or form a part of any offer or solicitation to purchase or subscribe for securities in the United States. The securities mentioned herein (the "Securities") have not been, and will not be, registered under the United States Securities Act of 1933 (the "Securities Act"). The Securities may not be offered or sold in the United States absent registration or an applicable exemption from, or in a transaction not subject to, the registration requirements of the Securities Act. There will be no public offer of the Securities in the United States, Canada and Japan. Citi, J.P. Morgan, Standard Bank and Rothschild are acting exclusively for the Company and no one else in connection with the Rights Offer. They will not regard any other person (whether or not a recipient of this announcement) as their respective clients in relation to the Rights Offer and will not be responsible to anyone other than the Company for providing the protections afforded to their respective clients nor for giving advice in relation to the Rights Offer or any transaction or arrangement referred to herein. No representation or warranty, express or implied, is made by Citi, J.P. Morgan, Standard Bank and Rothschild as to the accuracy, completeness or verification of the information set forth in this announcement, and nothing contained in this announcement is, or shall be relied upon as, a promise or representation in this respect, whether as to the past or the future. Citi, J.P. Morgan, Standard Bank and Rothschild assume no responsibility for its accuracy, completeness or verification and, accordingly, disclaim, to the fullest extent permitted by applicable law, any and all liability which they might otherwise be found to have in respect of this announcement or any such statement. Date: 29/08/2014 08:35:00 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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