DEEP RIVER INVESTMENT LIMITED
CIEL INVESTMENT LIMITED
FURTHER ADMISSION DOCUMENT
In respect of the further issue and admission of a maximum of up to408,683,180 new ordinary shares of no par value of DRI on the Development & Enterprise Market (‘DEM’) following the Amalgamation.
AND
AMALGAMATION PROPOSAL
In respect of the proposed amalgamation (the ‘Amalgamation’) of CIEL Investment Limited (‘CIL’) with and into Deep River Investment Limited (‘DRI’)
DECLARATION BY DIRECTORS
The Directors, whose names appear under section 2.5.4, collectively and individually accept full responsibility for the accuracy and completeness of the information contained in this document. They furthermore declare that, to the best of their knowledge and belief, and after having made reasonable inquiries, this document complies, where applicable, with the DEM Rules, the Companies Act 2001, the Securities Act 2005 and any applicable rules and regulations made thereunder.
The Directors of CIL also declare that the proposed transaction is a related party transaction under DEM Rule 13by virtue of CIL being controlled by DRI.
The Directors of DRI further state that:
(i)in their opinion, having made due and careful enquiry, the working capital available to DRI is sufficient for its present requirements, that is for at least twelve (12) months from the date of admission of its new Ordinary Shares;
(ii)DRI has no legal or arbitration proceedings during the previous twelve (12) months which may have, or have had in the recent past, significant effects on its financial position or profitability; and
(iii)no significant change in the financial or trading position has occurred since the end of the latest published financial statements ended September 30, 2013.
The Amalgamation is subject to the satisfaction of the following conditions precedent:
(i)the approval of the shareholders of DRI and CIL respectively by special resolutions;
(ii)the receipt of the third party and regulatory approvals set out in a document available for inspection at the registered offices of DRI and CIL respectively;
There is no certainty that those conditions precedent will be satisfied. DRI and CILwill issue communiqués in relation to the status of those conditions precedent in due course.
It is noted that:
(i)the Board of Directors of DRI and CIL have, pursuant to an agreement made with CIL under section 109(2)(b) of the Companies Act 2001, agreed that DRI as the Amalgamated Company will acquire the shares of shareholders of CIL voting against the resolution approving the Amalgamation and exercising their rights to require CIL to acquire their shares pursuant to sections 108 and the following of the Companies Act 2001 (the ‘CIL Dissenting Shareholders’);
(ii)DRIas the Amalgamated Company will also acquire the shares of DRI shareholders voting against the resolution approving the Amalgamation and exercising their rights to require DRI to acquire their shares pursuant to sections 108 and following of the Companies Act 2001 (the ‘DRIDissenting Shareholders’).
Attention is drawn to the fact that the Board of Directors of each of DRI and CILhas resolved to recommend to their respective shareholders not to proceed with the Amalgamation if:
(i)the aggregate liability of DRI to the DRIDissenting Shareholders and the CIL Dissenting Shareholders (together the ‘Dissenting Shareholders’) arising at law and pursuant to the above agreement with CIL exceeds the budget of MUR 500 Millionas established by the Board of Directors of DRI for that purpose; and
(ii)the Board of Directors of DRIand CIL areunable to arrange for one or more third parties to purchase the shares of the Dissenting Shareholders for any amount in excess of the budgeted MUR 500 Million on or before June 30, 2014.
Subject to the timely satisfaction or waiver of the conditions precedent, the completion of the Amalgamation is expected to occur onJanuary 24, 2014(the ‘Completion Date’) but the Board of Directors of DRI and CIL may jointly agree to postpone the Completion Dateprovided that they give notice of their decision. However if all the conditions precedent are still not met or waived by June 30, 2014 at latest, the Amalgamation will not be completed.
For and on behalf of the Board of Directors of DRI
………………………………………………………… ………………………………………………………
Director Director
DEEP RIVER INVESTMENT LIMITED
CIEL INVESTMENT LIMITED
Further Admission Document and Amalgamation Proposal
Page
1DEFINITIONS
2FURTHER ADMISSION DOCUMENT AND AMALGAMATION PROPOSAL
2.1Context
2.2The Amalgamated and Amalgamating Companies
2.3Details of the Amalgamation
2.4CALENDAR OF EVENTS
2.5CORPORATE INFORMATION
2.5.1Deep River Investment Limited
2.5.2CIEL Investment Limited
2.5.3Amalgamated Company
2.5.4Information for DRI, CIL and the Amalgamated Company
2.5.5Third Party Information
2.5.6Directors of Amalgamated company
3RATIONALE BEHIND THE AMALGAMATION
4PARTICULARS OF THE TERMS OF THE AMALGAMATION
4.1Exchange of Shares
4.2Share Exchange Ratio
4.3Number of Shares to be Issued by the Amalgamated Company to CIL’s Shareholders
4.4Statement from the Independent Valuer
4.5Approval of the Listing Executive Committee (‘LEC’)
4.6Admission Costs
4.7Share Capital
4.7.1Stated Capital
4.7.2Other Information concerning the Shares
4.7.3Shareholding Structure
5PROCEDURES FOR THE EXCHANGE OF SHARES (THIS PARAGRAPH APPLIES TO CIL SHAREHOLDERS ONLY)
6STATEMENT OF DIRECTORS’ INTERESTS
7STATEMENT OF DIRECTORS OF DRI AND CIL
8STATEMENT SETTING OUT THE RIGHTS OF SHAREHOLDERS UNDER SECTION 108 OF COMPANIES ACT 2001
9RISK FACTORS
9.1Business Risks
9.1.1Market Risk
9.1.2Credit Risk
9.1.3Liquidity Risk
9.2Operational Risks
9.3Regulatory Risks
9.4Completion Risks
10PROPOSED CONSTITUTION OF AMALGAMATED COMPANY
11OTHER MATTERS
11.1Subsequent Management and Operation of the Amalgamated Company
12LEGAL AND ARBITRATION PROCEEDINGS
13AUDITORS REPORT
14DOCUMENTS AVAILABLE FOR INSPECTION
Appendix IKey provisions of the proposed constitution of the Amalgamated Company
Appendix IIPart A - Copy of the resolutions to be adopted at the special meeting of the shareholders of DRI
Part B – Copy of the resolutions to be adopted at the special meeting of the shareholders of CIL
Appendix IIIPart A - Copy of directors’ certificate for DRI
Part B – Copy of the directors’ certificate for CIL
Appendix IVSection 110 of Companies Act 2001
DEEP RIVER INVESTMENT LIMITED
CIEL INVESTMENT LIMITED
Further Admission Document and Amalgamation Proposal
1DEFINITIONS
In this document, where the context permits, the abbreviations set out below bear the following meanings:
Amalgamated Company / The amalgamated company is described in paragraph 2.2Amalgamation / The proposed amalgamation of CILwith and into DRI as described in this Amalgamation Proposal
Amalgamation Proposal / The section of this document prepared in accordance with sections 244 to 248 of the Companies Act 2001
CDS / The Central Depository System
CIL / CIEL Investment Limited, a public company (File No. C2940 and BRC No C06002940) with limited liability registered under the laws of Mauritius
CIL shares / Ordinary shares in the capital of CIL
Completion / The completion of the Amalgamation on the Effective Date
DEM / The Development & Enterprise Market of the SEM
DEM Rules / The rules governing securities listed on the DEM
Dissenting Shareholder / A shareholder of DRI or CIL, as the context requires, who at the special meeting of the shareholders of DRI or CIL, as applicable, casts all the votes attached to the shares registered in his name and for which he is the beneficial owner against the approval of the Amalgamation
DRI / Deep River Investment Limited, a public company (File No. 717 and BRC No. C06000717) with limited liability registered under the laws of Mauritius
DRIordinary shares / Ordinary shares in the capital of DRI
DRI Redeemable Restricted A Shares / Redeemable restricted A shares in the capital of DRI
Effective Date / The effective date of the Amalgamation shall be defined in paragraph 2.1
EPS / Earnings per share
Independent Valuer / Ernst & Young, Mauritius
Listing Particulars / Listing Particulars for the listing of the Ordinary Shares of the Amalgamated Company on the Official Market of the SEM in line with the Listing Rules, following the Amalgamation
Listing Rules / The rules governing securities listed on the Official Market of the SEM
MUR / Mauritian Rupee
NAV / Net Asset Value
Ordinary Shares / Ordinary shares of the Amalgamated Company
SEM / The Stock Exchange of Mauritius Ltd, as established under the repealed Stock Exchange Act 1988 and now governed by the Securities Act 2005 as amended
Share Exchange Ratio / Has the meaning set out in paragraph 4.1
Transaction Adviser / BDO & Co
Valuation Report / The valuation report of the Independent Valuers dated November 15, 2013
2FURTHER ADMISSION DOCUMENTANDAMALGAMATION PROPOSAL
2.1Context
This document, which conforms with the provisions of sections 244 to 246 and 248 of the Companies Act 2001 and the DEM Rules, has been prepared in the context of the Amalgamation and the admission of the new Ordinary Shares of DRIon the DEM. It contains all the details required by section 245(1) of the Companies Act 2001 and Schedule 2 of the DEM Rules and contains or refers to certain other information required to be sent to the shareholders of DRI and CIL under section 246(1) of the Companies Act 2001.
Subject to the timely satisfaction or waiver of the conditions precedent set out in the Declaration of Directors, the Effective Date of the Amalgamation is expected to be on January 24, 2014.
2.2The Amalgamated and Amalgamating Companies
The Amalgamated Company will be DRI. The latter will be rebranded CIEL on the Effective Date. The registered office of the Amalgamated Company will be 5th Floor, Ebène Skies, rue de l’Institut, Ebène.
The amalgamating company will be CIL. The registered office of CIL is 5th Floor, Ebène Skies, rue de l’Institut, Ebène.
2.3Details of the Amalgamation
When the Amalgamation takes effect:
- DRI and CIL will merge and the Amalgamated Company will continue as the surviving entity;
- all property, rights, powers, privileges, liabilities and obligations of CIL shall continue to be the property, rights, powers, privileges, liabilities and obligations of the Amalgamated Company;
- CIL will be removed from the register of the Registrar of Companies;
- CIL will cease to exist as a separate legal entity and its admission will be cancelled from the DEM;
- any proceedings which may be pending by, or against, CIL may be continued by, or against, the Amalgamated Company;
- any conviction, ruling, order or judgment in favour of, or against, CIL may be enforced by or against the Amalgamated Company; and
- CIL’s shareholders (other than those who do not vote in favour of the Amalgamation and who exercise their rights to require CIL to acquire their shares) will receive DRIOrdinary Shares as provided herein and their CILshares will then be cancelled.
Should the Amalgamation be completed on the Effective Date:
(a)the last date of dealings in CILordinary shares on the DEM is expected to be January 16, 2014;
(b)following the Amalgamation, the admission of CIL will be cancelled from the DEM on the Effective Date;
(c)dealings in DRIordinary shares on the DEM are expected to be suspended between January 20, 2014 and February 03, 2014 inclusively; and
(d)the Ordinary Shares of the Amalgamated Company will be thereafter listed on the Official Market of the SEM. Dealings in the Ordinary Shares of the Amalgamated Company are expected to commence on February 04,2014.
Special attention is drawn to the fact that at Completion, the Amalgamated Company, which will be renamed “CIEL”, will bear its own identity. The exact name has not yet been determined as at the date of this document.
2.4CALENDAR OF EVENTS
The table below shows the calendar for the Amalgamation:
CALENDAR FOR AMALGAMATION PROCEDURENovember 15, 2013 / Meetings of the Board of Directors of DRI and CIL
December 30, 2013* / Special meetings of the shareholders of DRI and CIL
January 09, 2014 / Last day to deposit share certificates of DRI and CIL in order to trade before the effective date of the Amalgamation
January 16, 2014 / Last trading session of DRIordinary shares and CIL shares on the DEM
January 20, 2014 / Suspension of dealings of DRI ordinary sharesand CIL shares
January23, 2014 / Closure of DRIand CIL share registry
January 24, 2014 / Effective Date of the Amalgamation
January30, 2014 / Issue of new Ordinary Shares of the Amalgamated Company to CIL shareholders and subsequent admission of those new Ordinary Shares on the DEM
February 03, 2014 / Migration of all the Ordinary Shares of the Amalgamated Company from the DEM to the Official Market of the SEM
February 04, 2014 / Firsttrading day of the Ordinary Shares of the Amalgamated Company on the Official Market of the SEM
*The shareholders who vote against the Amalgamation shall have fourteen (14) days to request DRIand CIL to purchase back their shares.
1
DEEP RIVER INVESTMENT LIMITED
CIEL INVESTMENT LIMITED
Further Admission Document and Amalgamation Proposal
2.5CORPORATE INFORMATION
2.5.1Deep River Investment Limited
2.5.1.1Company Background and Principal Activities
DRI is a public company incorporated and domiciled in Mauritius on August 31, 1948. DRI is listed on the DEM and is registered as a reporting issuer with the Financial Services Commission.
The company holds investments in three companies which are listed on the Stock Exchange of Mauritius Ltd, namely, Alteo Limited, CIL and CIEL Textile Limited from which it receives dividend income.
2.5.1.2Stated Capital
As at June 30, 2013, the stated capital of DRI was MUR 822,665,000, made up of 82,266,500 ordinary shares of no par value.
At a Special Meeting of the shareholders of DRI held on August 8, 2013, the shareholders approved the targeted share buyback of up to 5,510,204 no par value ordinary shares held by Firefox Ltd in DRI. The 5,510,204 shares bought back represented 6.70% of DRI’s stated capital and the shareholders further resolved at that meeting that the company will hold the said shares as treasury shares.
The share buyback was processed on the Crossing Board of The Stock Exchange of Mauritius Ltd on August 15, 2013.
The stated capital of DRI post share buyback effected on August 8, 2013, is therefore composed of 82,266,500 ordinary shares of which 5,510,204 shares are held as treasury shares.
On October 30, 2013, the shareholders of DRI have approved a share split where each ordinary shares of DRI will be divided into 10 DRI Ordinary Shares as at the last cum date of November 14, 2013, at close of trading. The stated capital of DRI post share split is therefore 822,665,000 ordinary shares of which 55,102,040 shares are held as treasury shares.
2.5.1.3Financial Highlights
DRI’s separatefinancial statements’ highlights for the years ended June 30, 2013, 2012 and 2011 are as follows:
2013 / 2012 / 2011(Audited) / (Audited) / (Audited)
Total Assets / MUR'000 / 3,997,718 / 3,345,008 / 3,106,446
Owner’s interest / MUR'000 / 3,869,129 / 3,265,234 / 3,018,856
Turnover / MUR'000 / 110,266 / 93,930 / 67,036
Profit after tax / MUR'000 / 104,446 / 79,079 / 59,856
KPI's:
EPS / MUR / 1.27 / 0.96 / 0.73
NAV per share / MUR / 47.03 / 39.69 / 36.70
DRI’s financial statements’ highlights for the years ended June 30, 2013, 2012 and2011are as follows:
2013 / 2012 / 2011(Audited) / (Audited) / (Audited)
Total Assets / MUR'000 / 6,572,600 / 5,438,672 / 4,947,753
Owner’s interest / MUR'000 / 6,444,011 / 5,358,897 / 4,860,163
Other income / MUR'000 / 200 / 200 / 200
Share of results of associates / 311,912 / 246,400 / 292,655
Profit before tax / MUR’000 / 306,270 / 231,778 / 285,707
Profit after tax / MUR'000 / 306,242 / 231,750 / 285,676
KPI's:
EPS / MUR / 3.72 / 2.82 / 3.47
NAV per share / MUR / 78.33 / 65.14 / 59.08
Dividend per share
Interim / MUR / 0.40 / 0.50 / 0.39
Final / MUR / 1.00 / 0.50 / 0.34
2.5.1.4 Significant Change in the Company’s Financial or Trading Position
There has been no significant change in the financial or trading position of DRI since the last published interim (quarterly) financial statements, save for the share buyback as detailed in section 2.5.1.2.
2.5.2CIELInvestment Limited
2.5.2.1Company Background and Principal Activities
CIL is a public company incorporated and domiciled in Mauritius. CIL is listed on the DEM and is registered as a reporting issuer with the Financial Services Commission.
The company holds investments in a diversified portfolio of equity and equity related investments, from which it receives dividend income.
2.5.2.2Stated Capital
As at March 31, 2013, the stated capital of CIL was MUR 1,816,744,836, made up of 1,006,765,347 ordinary shares of no par value (including 103,215,792 no par value ordinary shares held as treasury shares).
CIL has implemented a share buyback exercise since the beginning of 2013 with the objective of reducing the discount of the share price to the NAV and creating value for all shareholders.
2.5.2.3Financial Highlights
The financial highlights of CIL(the company)for the years ended March 31, 2013, 2012 and 2011 are as follows:
2013 / 2012 / 2011(Audited) / (Audited) / (Audited)
Total Assets / MUR'000 / 4,459,741 / 4,469,068 / 5,016,563
Owner’s interest / MUR'000 / 4,281,685 / 4,272,465 / 4,889,894
Turnover / MUR'000 / 81,577 / 118,944 / 318,136
Profit after tax / MUR'000 / 40,815 / 96,723 / 581,047
KPI's:
EPS / MUR / 0.05 / 0.11 / 0.64
NAV per share / MUR / 4.74 / 4.73 / 5.41
The financial highlights of CIL (the group)for the years ended March 31, 2013, 2012 and 2011 are as follows:
2013 / 2012 / 2011(Audited) / (Audited) / (Audited)
Total Assets / MUR'000 / 7,362,854 / 6,592,725 / 5,892,785
Owner’s interest / MUR'000 / 6,264,825 / 5,556,731 / 5,123,625
Turnover / MUR'000 / 365,783 / 344,578 / 295,332
Profit after tax / MUR'000 / 147,548 / 489,422 / 214,303
KPI's:
EPS / MUR / 0.14 / 0.39 / 0.23
NAV per share / MUR / 6.93 / 6.15 / 5.67
Dividend per share
Interim / MUR / 0.02 / 0.02 / 0.02
Final / MUR / 0.04 / 0.06 / 0.05
2.5.2.4Significant Change in the Company’s Financial or Trading Position
There has been no significant change in the financial or trading position of CIL since the last published interim (quarterly) financial statements.
2.5.3Amalgamated Company
The Amalgamated Company’s statement of financial position, post Amalagamation, as at September 30, 2013 is as follows:
Period ended September 30,2013(Unaudited)
MUR’000
ASSETS EMPLOYED
Non-current assets / 8,133,957
Current assets / 63,188
8,197,145
EQUITY AND LIABILITIES
Shareholder’s interest / 6,963,952
Current liabilities / 1,233,193
8,197,145
2.5.4
Informationfor DRI, CIL and the Amalgamated Company
Chairman / Mr. DALAIS P. Arnaud
Chemin Campement, Floréal, Mauritius / Mr. DALAIS G. Christian
38, Shah Avenue, Floréal, Mauritius / Mr. DALAIS P.Arnaud
Chemin Campement, Floréal, Mauritius
Directors / Mr. DALAIS, G. Christian
38, Shah Avenue, Floréal, Mauritius
Mr.DALAIS, J. Jean-Pierre
King George VI Avenue, Floréal, Mauritius
Mr. DALAIS R. Thierry
Plantation Marguery, Rivière Noire, Mauritius
Mr. DANON, Pierre
30 Boulevard Victor Hugo, 92200 Neuilly Sur Seine, Paris, France
Mr. DE CHASTEAUNEUF L. J. Jérôme
62, Domaine de Bon Espoir, Piton, Mauritius
Mr. DELAPORTE M. F.Antoine
Royal Road, Grand Baie, Mauritius
Mr. ESPITALIER-NOEL M. P. Roger
28, Angus Road, Vacoas, Mauritius
Mr. GUIMBEAU, M.A. Louis
'Chants d'Oiseau', La Preneuse Coastal Road, Black River, Mauritius
Mr. MAYER J.Harold
56, Plantation Marguery
Rivière Noire
Mr. RAJAHBALEE, M. Iqbal, SC
26, Shand Street, Beau Bassin, Mauritius
Mr. THIEBLIN Xavier
Moka 97438
Rivière des Pluies
Ste Marie
Ile de La Réunion / Mr. PIAT DALAIS C. Maurice
40D, Botanical Garden Street, Curepipe, Mauritius
Mr. DALAIS J. Jean-Pierre
King George VI Avenue, Floréal, Mauritius
Mr. DALAIS P. Arnaud
Chemin Campement, Floréal, Mauritius
Mr. DALAIS R. Thierry
Plantation Marguery, Rivière Noire, Mauritius
Mr. DE CHASTEAUNEUF L. J.Jean Jérôme
62, Domaine de Bon Espoir, Piton, Mauritius
Mr. DELAPORTE M. F.Antoine
Royal Road, Grand Baie, Mauritius
Mr. GUIMBEAU M.A. Louis
Chants d'Oiseau, La Preneuse Coastal Road, Black River, Mauritius
Mr. HUGNIN M. J. Guy
Bois Chéri Road, Moka, Mauritius
Mr. ROUSSET M. M. Patrice
Botanical Garden Street, Curepipe, Mauritius /
Mr. PIAT DALAIS C. Maurice
40D, Botanical Garden Street, Curepipe, Mauritius
Mr. DALAIS, G.Christian
38, Shah Avenue, Floréal, Mauritius
Mr. DALAIS, J. Jean-Pierre
King George V1 Avenue, Floréal, Mauritius
Mr. DANON, Pierre
30 Boulevard Victor Hugo, 92200 Neuilly Sur Seine, Paris, France
Mr. DE CHASTEAUNEUF, L. J. Jérôme
62, Domaine de Bon Espoir, Piton, Mauritius
Mr. GUIMBEAU, M.A. Louis
'Chants d'Oiseau', La Preneuse Coastal Road, Black River, Mauritius
Mr. HUGNIN, M. JGuy
Bois Chéri Road, Moka, Mauritius
Mr. RAJAHBALEE, M. Iqbal, SC
26, Shand Street, Beau Bassin, Mauritius
Mr. SADDUL, Neermal
80A, Club Road, Vacoas, Mauritius
Alternate Directors / N/A / Mr. ESPITALIER-NOEL M. P. Roger
28, Angus Road, Vacoas, Mauritius
Mr.PIAT DALAIS Marc C.
Coastal Road, Pointe aux Canonniers, Mauritius / N/A
Registered Office / 5th Floor, Ebène Skies, rue de l'Institut, Ebène, Mauritius
Tel: (+230 404 2200) / 5th Floor, Ebène Skies, rue de l'Institut, Ebène, Mauritius
Tel: (+230 404 2200) / 5th Floor, Ebène Skies, rue de l'Institut, Ebène, Mauritius
Tel: (+230 404 2200)
Company Secretary / CIEL Corporate Services Ltd
5th Floor, Ebène Skies, rue de l'Institut, Ebène, Mauritius / CIEL Corporate Services Ltd
5th Floor, Ebène Skies, rue de l'Institut, Ebène, Mauritius / CIEL Corporate Services Ltd
5th Floor, Ebène Skies, rue de l'Institut, Ebène, Mauritius
Service Address / 5th Floor, Ebène Skies, rue de l'Institut, Ebène, Mauritius / 5th Floor, Ebène Skies, rue de l'Institut, Ebène, Mauritius / 5th Floor, Ebène Skies, rue de l'Institut, Ebène, Mauritius
Shares / Ordinary shares to be listed on the Official Market
Redeemable Restricted A Shares not to be listed / Ordinary shares listed on DEM
Redeemable Restricted A Shares not to be listed / Ordinary shares listed on DEM
ISIN / DRIL.I0002 / DRIL.I0002 / CIEL.I0000
Directors’ Profiles