PRESS RELEASES
VenFin LIMITED - ANNOUNCEMENT REGARDING INTERVID LIMITED
VenFin refers shareholders to the announcements released on Friday 30 January 2004 and 4 February 2004 by Intervid Limited (Intervid). VenFin has an equity interest of approximately 17% and a further indirect investment in Intervid International AG through a convertible bond held by RFS Holdings Limited (RFS Holdings), which is an associate of VenFin.
The first announcement recorded that Intervid had received notice from certain of its shareholders, referred to as the Howard family, in terms of Section 220 of the Companies Act No 61 of 1973, as amended, proposing the removal of the independent chairman of Intervid and the appointment of three non-executive directors (the proposal).
The second announcement by Intervid contained the views and recommendation
of
the majority of the board of Intervid (the majority recommendation). The
majority recommendation was that shareholders vote against the proposal,
for various reasons including concerns regarding governance, the disruption
to the turnaround currently being effected by the new management and the
threat that the proposal may have to Intervids future financial requirements.
It should be noted that VenFin is not represented on the Board of Intervid.
The second announcement also contains various references to and
assertions about
VenFin. These include:
- reference to negotiations that are currently underway with RFS Holdings, regarding limiting the conversion rights provided in the convertible bond to 65% of Intervids issued share capital;
- references to efforts by Intervid to obtain an underwriter for a possible rights issue and to VenFins offer to act as an underwriter to a rights issue; and
- the assertion that VenFin is opposed to changes to the board of Intervid, including the removal of the independent non-executive chairman, Mr Bill Lambert.
The majority recommendation includes the views that:
- support from VenFin and RFS Holdings is important for the future of Intervid until the turnaround process fully translates into sustainable financial delivery;
- the majority of the board is not aware of any other prospective financing arrangements in the event that VenFin, RFS Holdings or Intervids bankers react unfavourably to the proposal.
Intervid published a cautionary announcement on 9 January 2003 regarding a potential recapitalisation of Intervid. VenFin records that it is concerned about the developments at Intervid. To date, the Howard family has not put forward proposals regarding Intervids future financing requirements and their proposal to restructure the Intervid Board has, in VenFins view, created some uncertainty over Intervids future.
As such, VenFin is strongly opposed to the proposal put forward by the Howard family to restructure the Intervid Board. VenFin broadly agrees with the views expressed in the majority recommendation. Should the Howard family not shortly propose a viable and acceptable alternative solution to Intervids future financing requirements, VenFin will have to reconsider its position in Intervid.
VenFin will in the interim take all necessary steps to protect its investment in Intervid, even though this investment represents a very small proportion of VenFins portfolio of investments.
Stellenbosch
5 February 2004
Financial Adviser
Cazenove South Africa (Pty) Limited
Sponsor
Rand Merchant Bank (a division of FirstRand Bank Limited) Corporate Finance
Attorneys
Hofmeyr Herbstein & Gihwala Inc.
Date: 05/02/2004 01:12:03 PM Produced by the JSE SENS Department
05/02/2004 Source: JSE NEWS SERVICE