Nation Media : NMG Circular

SCHEDULE OF KEY EVENTS

The schedule of key events for the Buyback is set out below.

The listed dates and times are indicative only and may be changed by the Company (subject to any applicable legal requirements) in which event details of the new times and/or dates will be notified to shareholders by a public announcement and posted on www.nationmedia.com

Except where otherwise indicated, references to time refer to Kenyan time.

PART I: LETTER FROM THE CHAIRMAN

To all shareholders of Nation Media Group PLC

Dear Shareholder,

Proposed buyback of up to 10% of the issued share capital adjusted for treasury shares of the Company from the open market through the securities exchange

1. INTRODUCTION

On 06 June, 2023, the Board announced its recommendation of a share buyback programme under which the Company would purchase up to ten percent (10%) of its issued and paid-up share capital adjusted for treasury shares as permitted under Section 447 of Part XVI of the Companies Act (Buyback).

The Buyback is to be effected through a purchase of Ordinary Shares from sharehold- ers via the 'open market' route through the securities exchange mechanism, i.e., using the electronic trading facilities of the securities exchange where the Ordinary Shares of the Company are listed.

Shareholders are invited to sell all or some of their Ordinary Shares (subject to the Maximum Buyback Size) at the Buyback Price. It is not mandatory for shareholders to sell any of their Ordinary Shares if they do not wish to do so.

The purpose of the Circular is to provide you with information about the Buyback and the Board's basis for the proposal. This is set out under Part II (Buyback) of this Circular. The Circular also contains further details on the procedure to be followed by those shareholders wishing to participate in the Buyback.

The Buyback and the Buyback Price as recommended by the Board are subject to approval of the shareholders at the AGM pursuant to Section 458 of Part XVI of the Companies Act. Consequently, the Buyback Resolution will be presented at the AGM to be held virtually at 3:00 PM on Friday, 30 June, 2023, for consideration and if deemed fit, approval by the shareholders. The shareholders will also have the oppor- tunity to discuss the Buyback with the Directors at the AGM.

The Notice of AGM, including the Buyback Resolution, is set out on page 9 of the Circular.

2. THE BUYBACK

The Company is listed on the main market segment of the Nairobi Securities Ex- change (NSE) and cross listed on the Uganda Securities Exchange, Dar es Salaam Stock Exchange and Rwanda Stock Exchange (Cross Listed Securities Exchanges)

The Company is proposing a buyback of a proportion of its listed Ordinary Shares to give shareholders an option to cash in on their investments. The Buyback seeks to offer the shareholders an alternative option to realise value from their investment.

ANNUALGENERAL MEETING

In addition to the consideration of the Buyback Resolution, other Resolutions set out in the Notice of AGM will be considered and, if thought fit, approved at the AGM.

The full text of these Resolutions is set out in the Notice of AGM on page 9 of this Circular.

Shareholders wishing to participate in the meeting should register for the AGM by visiting the online portal https://digital.candrgroup.co.ke or via a link to the AGM Platform that will be sent via SMS and/or Email or dialing [*483*508#] on their mobile phones, for all networks and following the various prompts regarding the registration process.

In order to complete the registration process, shareholders will need to have their ID/Passport Numbers which were used to purchase their shares and/or their CDSC account number at hand.

For assistance, shareholders (whether in Kenya or outside) should dial the following helpline number: (020) 8690360 from 9:00 a.m. to 4:00 p.m. from Monday to Friday. Shareholders can also email digital@candrgroup.co.ke to be assisted to register.

1. ACTIONS TO BE TAKEN
   Before the AnnualGeneral Meeting
   You will find a Proxy Form for use at the AGM at the AGM Event Page on digital@ candrgroup.co.ke. Instructions for use of the Proxy Form are set out at the end of the Notice of AGM.
   The completion and return of the Proxy Form will not preclude you from attending the AGM and voting if you wish to do so provided you are entitled to attend.
   If you wish to sell all or some of your Ordinary Shares under the Buyback, you should follow the procedures set out in Part IV (Terms and Conditions of the Buyback) of this Circular.
   Shareholders who do not wish to sell any Ordinary Shares under the Buyback are not required to take any action.
   The Board does not expect that the provisions of the Takeover Regulations will be triggered if shareholders with existing material holdings in the Company do not par- ticipate in the Buyback (assuming they maintain their level of shareholding as at the Buyback Reference Date).
2. DECLARATION OF SOLVENCY AND LIQUIDITY
   The Directors confirm that as at the date of this Circular, the assets of the Company are fairly valued and exceed the liabilities of the Company and that the Company will be able to pay its debts as they become due in the ordinary course of business for a period of twelve (12) months from the date of this Circular.
3. CONCLUSION
   You are advised to read all of the information contained in this Circular before decid- ing on the course of action you will take in respect of the AGM and the Buyback. The Board makes no recommendation to shareholders in relation to participation in the Buyback.
   The results of the AGM will be communicated through a public announcement and the Company's website as soon as possible once known and on or prior to the date on which the Buyback opens.
   The results of the Buyback will also be communicated through a public announce- ment and the Company's website by 5:00 p.m. on July 8, 2024 or earlier if the Com- pany shall have bought 10% of its issued share capital adjusted for treasury shares prior to that date.

Yours faithfully,

Dr. Wilfred Kiboro

Chairman

For and on behalf of the Board

PART II: THE BUYBACK

1. Background and reasons for the Buyback
   The Company is listed on the main market segment of the Securities Exchanges.
   The Company is proposing a buyback of up to 10% of its listed Ordinary Shares ad- justed for treasury shares to offer the Company's shareholders partial liquidity of their shareholding at a price that is more reflective of the value of the Ordinary Shares while retaining optionality to benefit from potential improvement in future earnings and capital gains.
   The Buyback:
2. 1. is available to all shareholders regardless of the size of their shareholding but subject to the Maximum Buyback Size;
   2. provides shareholders who wish to sell Ordinary Shares the opportunity to do so on an open market basis;
   3. provides shareholders who choose to sell their Ordinary Shares a potential return on investment;
   4. provides shareholders who choose to sell a proportion of their shares a potential uplift in the capital return on their remaining shareholding;
   5. allows shareholders who wish to maintain their investment in Ordinary Shares at this time to do so.
   6. offers a premium on the volume weighted average price per Ordinary Share over the thirty days prior to the Buyback Record Date.
3. Details of the Buyback
   Full details of the Buyback, including the terms and conditions on which it is made, are set out in Part IV (Terms and Conditions of the Buyback) of this Circular.
   Ordinary Shares will only be bought back at the Buyback Price.
   The Buyback Price represents a premium above the volume weighted average price per Ordinary Share over the thirty days prior to the Buyback Record Date. The Board rec- ommends that the maximum price of the purchase shall be KES 20, being 26.5% above the weighted average price of KES 15.80 in the 30 days prior to the Buyback Reference Date. The minimum price shall be KES 2.50, being the lower of the nominal price (KES 2.50) and the prevailing market as the Buyback Reference Date (KES. 15.40)
   The Buyback is conditional on:
4. 1. approval by the CMA;
   2. the passing of the Buyback Resolutions set out in the Notice of AGM;
   3. the Buyback not having been terminated in accordance with paragraph 9 (Right to terminate the Buyback) of Part IV (Terms and Conditions of the Buyback) of this Circular;
   4. the Company continuing to have sufficient Profits Available for Distribution during the Buyback offer period; and
   5. the amount of the Company's net assets, less the monies to be used to acquire the Ordinary Shares pursuant to the Buyback, not being less than the aggregate of its called-up share capital and its undistributable reserves (as defined under the Companies Act) during the Buyback offer period.

Under the Buyback:

1. the Company will have the option, but not the obligation, to acquire (acting as principal and not as agent, nominee or trustee) up to 19,029,516 Ordinary Shares, representing up to approximately 10% of the Company's Issued Share Capital ad- justed for treasury shares at the Buyback Reference Date from the Shareholders at the Buyback Price in accordance with the Buyback Conditions;
2. all Ordinary Shares acquired by the Company will be held as treasury Ordinary Shares. The treasury Ordinary Shares will remain admitted to trading on the relevant stock exchanges but will be dormant and not trading (and held in the Company's CDSA) in accordance with the applicable regulations;
3. there is no obligation on shareholders to participate in the Buyback;
4. each shareholder will be entitled to sell all or some of their shares subject to the Maximum Buyback Size by way of open market sale on the Securities Exchange;
5. the maximum number of Ordinary Shares that may be purchased under the Buy- back is 19,029,516 Ordinary Shares;
6. the Buyback will be financed out of Profits Available for Distribution detailed in page 89 of the Company's audited financial statements as at 31 December 2022 as retained earnings of KES 7.6 billion and paid out of cash and cash equivalents of KES 1.9 billion
7. The Company has been exempted from the limit under the Guidelines to purchase no more than 25% of the average daily trading volume for the four calendar weeks preceding the date of purchase.

3. Effect of the Buyback on the shareholding structure

The Issued Share Capital of the Company on the Buyback Record Date was KES 518,491,288 divided into 190,295,163 listed Ordinary Shares of KES 2.50 each and 17,101,352 treasury shares of KES 2.50 each. If the Buyback is implemented in full, this will result in the purchase of 19,029,516 Ordinary Shares (representing approximately 10% of the Issued Share Capital adjusted for treasury shares of the Company on the

Buyback Date).

The Ordinary Shares available for trading could be reduced by up to 19,029,516 Ordinary Shares.

The Shares purchased pursuant to the proposed buyback shall constitute treasury shares which are ineligible for voting, dividend or any other rights.

4. How to Participate in the Buyback

Each Shareholder is entitled to sell all or some of their Ordinary Shares, subject to the Maximum Buyback Size.

Details of the procedures for selling and settlement in relation to Ordinary Shares held in uncertificated form are set out in Part IV (Terms and Conditions of the Buyback) of this Circular.

Shareholders who hold their Ordinary Shares in certificated form should have these Ordinary Shares dematerialized (have their share certificates converted into an electronic form) to enable them participate in the Buyback. Such shareholders should consult with the Sponsoring Stockbroker or their preferred stockbroker, banker or other agent in relation to dematerialization.

Shareholders who do not wish to sell any Ordinary Shares should not take any action. Shareholders holding Ordinary Shares which are not dematerialized are encouraged to dematerialize such Ordinary Shares irrespective of whether they participate in the Buyback or not.

1. Purchase of Ordinary Shares
   Successfully offered Ordinary Shares will be purchased by the Company pursuant to the Buyback. Shareholders will not be obliged to pay any fees, commission, or dealing charges to the Company in connection with the Buyback. However, if a Shareholder owns Ordinary Shares through a stockbroker, banker or other agent and such agent offers for sale Ordinary Shares on your behalf, such agent may charge you a fee for doing so. You should consult with your stockbroker, banker or other agent to determine whether any charges will apply and which charges would be met by you.
   The rights of Shareholders who do not participate in the Buyback will be unaffected by the Buyback.
2. Circumstances in which the Buyback may not proceed
   The Buyback is conditional on, amongst other things, the passing of the Buyback Resolutions as set out in the Notice of AGM and on satisfaction of the other Buyback Conditions, specified in paragraph 2.1 of Part IV (Terms and Conditions of the Buyback) of this Circular.
   The Company has reserved the right, in its sole and absolute discretion, at any time prior to the announcement of the results of the Buyback, to extend the period during which the Buyback is open and/or vary the aggregate value of the Buyback, based on market conditions and/or other factors, subject to compliance with applicable legal and regulatory requirements. Any such decision will be announced by the Company through a public announcement and on the Company's website. The Buyback is also conditional on there not arising any material adverse change or certain other force majeure events during the Buyback offer period (as may be determined by the Board in its sole discre- tion).
3. Impact of the share buyback on the Company's financial position
   The number of shares to be purchased under the Buyback is a maximum of 10% of the Issued Share Capital adjusted for treasury shares as at the Buyback Reference Date. The amount to be paid out is not expected to adversely impact the Company's financial position so as to affect its ordinary operations. The share buyback is expected to improve the Company's net asset value per share.
   The shares purchased under the Buyback scheme shall not thereafter be eligible for dividend, voting or any other shareholders' right and entitlements.
4. Full terms and conditions of the Buyback
   Full details of the Buyback, including the terms and conditions on which it is made, are set out in Part IV (Terms and Conditions of the Buyback) of this Circular. Some questions and answers related to the Buyback are set out in Appendix 2 (Questions and Answers in relation to the Buyback) of this Circular.
5. Tax
   Shareholders should take into account tax considerations when deciding whether or not to participate in the Buyback. Summary details of certain Kenya taxation considerations are set out in Part V (Tax Aspects of the Buyback) of this Circular.