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20 November 2007.pdf - Vunani Limited - Abridged prospectus VUNANI


									Vunani Limited - Abridged prospectus

Formerly Vunani Capital Holdings (Proprietary) Limited
Incorporated in the Republic of South Africa
Registration number 1997/020641/06
JSE code: VUN
ISIN: ZAE000110359
"Vunani" or "the company" or “the group”

This abridged prospectus is not an invitation to the public to subscribe for shares in Vunani Limited
("Vunani"), but is issued in compliance with the Listings Requirements ("Listings Requirements") of
the JSE Limited ("JSE") for information purposes only.

The information in this abridged prospectus has been extracted from a full prospectus issued by
Vunani on 19 November 2007 ("the detailed prospectus"), which is available as set out in paragraph

At the date of listing the authorized share capital of Vunani comprises 2 billion ordinary shares with a
par value of 0.01 cent each, of which, after a private placement of Vunani ordinary shares by way of
an offer by the company for the subscription of 175 000 000 ordinary shares at an issue price of 100
cents per ordinary share in the share capital of Vunani thereby raising R175 million before expenses,
1 177 000 000 ordinary shares will be in issue.


Listing of Vunani ordinary shares ("shares") on the JSE.

    1.1 The Vunani group of companies was established following a management buyout on 21
        October 2004 by the senior executives, Ethan Dube, Butana Khoza and Mark Anderson
        through Business Venture Investments 855 (Pty) Limited (Registration number
        2004/006502/07) (which changed its name to Vunani Group (Pty) Limited ("VG") on 16
        February 2005), of the entire issued share capital of African Harvest Capital Holdings (Pty)
        Limited ("African Harvest Capital"), a wholly-owned subsidiary of African Harvest Limited
        ("African Harvest"), a company previously listed on the JSE.
    1.2 Vunani was incorporated on 1 December 1997 with the name Azureco 9 (Pty) Limited. It
        became a wholly-owned subsidiary of African Harvest on 11 October 1999 and changed its
        name to African Harvest Capital (Pty) Limited on 11 October 1999, specialising in BEE-
        related investments, corporate advisory services, private equity transactions and trading
    1.3 Following the management buy-out, African Harvest Capital changed its name to Vunani
        Capital Holdings (Pty) Limited on 16 February 2005 and again to Vunani (Pty) Limited on 5
        November 2007 on which date it was converted to a public company.
    1.4 On 23 May 2005 ABSA Bank Limited acquired a 20% shareholding in Vunani by way of a
        subscription for ordinary shares. This transaction provided Vunani with a capital injection and
        it provided the group with access to the further capital which was required to accelerate the
        growth of its balance sheet and operating activities.
    1.5 Vunani is today a diversified financial services group with a number of profitable operating
   2.1 The Vunani group is a majority black owned and managed financial services group.
   2.2 Vunani has taken advantage of recent favourable market conditions and has over the last
       three years established a number of profitable operating divisions.
   2.3 The group has offices in Johannesburg and Cape Town and employs over 50 people (mainly
       professionals) focusing on the provision of the following financial services:
        - Investments, private equity investments, asset management and corporate advisory
        - Stock broking; and
        - Property investment and development.
   2.4 The individual operations set out above are focused on their specific niche markets but have
       strong synergies between them. The role of the senior executives of the company is to
       ensure that the synergies between the individual operations are maximised.
   2.5 Vunani`s vision is to become a leading provider of financial services.

       In the opinion of the directors of the company, based on experience and market information
       available, the prospects of the company include the following:
   3.1 Vunani will continue to take advantage of attractive investment deal flow to grow its balance
   3.2 The capital injection as a result of the listing will enable the company to refinance funding
       provided by third parties where such funding has been used to acquire equity interests. This
       is expected to provide significant short, as well as long-term benefits to the company.
   3.3 The company`s operations are well-placed to grow organically and emphasis will be placed
       on extracting cash flows from these activities.
   3.4 Vunani will seek acquisitions in the financial services sector that can expand and strengthen
       its operations.

       The summarized historical financial information of Vunani for the financial periods ended 31
       December 2006 and 30 June 2007, and the forecast financial information for years ending 31
       December 2007 and 31 December 2008, the preparation of which is the responsibility of the
       directors, are set out below. This financial information must be read in conjunction with the
       independent reporting accountants` report thereon reproduced in Annexures 4 and 5 of the
       detailed prospectus.
   4.1 Extracts from the historical and forecast income statements

                                  Audited           Reviewed          Forecast           Forecast
                               31 December        30 June 2007      31 December        31 December
                                   2006             6 months            2007               2008
                                15 months             R`000          12 months          12 months
                                   R`000                               R`000              R`000

Revenue                            79 203            56 779            130 822           144 428

       - Other income              2 145              1 699            21 945             22 793

       - Operating costs          (58 525)          (34 749)           (87 105)          (80 962)

       - Operating profit          22 823            23 729            65 662              6 259

Investment income                  4 372              8 339            13 519             50 472
Fair value adjustments             266 125       397 389        670 047         251 247

Income from equity                   3 604           -           7 124           12 360
accounted investments

Earnings before interest,          296 924       429 457        756 352         400 338
taxation, depreciation and

Depreciation                        (1 176)        (438)          (886)           (978)

Amortization of intangible            50             -              -               -

Profit before interest and         295 798       429 019        755 466         399 360

Net interest paid                  (18 928)      (38 383)       (75 274)        (66 716)

Profit before taxation             276 870       390 636        680 192         332 644

Taxation                           (53 746)      (58 579)       (107 198)       (67 042)

Profit after taxation              223 124       332 057        572 994         265 602

Outside shareholders               (54 891)      (19 118)       (84 579)        (11 766)

Earnings attributable to           168 233       312 939        488 415         253 836
ordinary shareholders

Reconciliation of
headline earnings:

Profit attributable to ordinary    168 233       312 939        488 415         253 836

Headline earnings                  168 233       312 939        488 415         253 836
attributable to ordinary

Fully diluted pro forma           995 000 000   995 000 000   1 044 364 348   1 177 000 000
weighted average shares in
issue on which earnings are

(1) Fully diluted pro forma         16.9              31.5               46.8              21.6
earnings per share (cents)

Fully diluted pro                   16.9              31.5               46.8              21.6
 forma headline
 earnings per share

   1. The pro forma weighted average number of shares in issue for 31 December 2006 and 30
       June 2007 is based on the sub-division and increase of the ordinary shares in issue into 995
       000 000 ordinary shares in issue on the last practicable date as set out in paragraph 24.3 of
       the detailed prospectus. The actual number of shares in issue for 31 December 2006 and 30
       June 2007 is disclosed in Annexure 3 of the detailed prospectus.
   2. The assumptions upon which the forecast income statements are based are set out in
       paragraph 12.2.2 of the detailed prospectus.

    5. DIRECTORS, COMPANY secretary and registered office
    5.1 Full names, ages, business addresses and functions of the board of directors of Vunani:

Director                           Age                     Function               Business address

Ethan Gilbert Dube                  48             Chief Executive Officer      Vunani House Block C
                                                                                   151 Katherine
                                                                                  Street, Sandown,
                                                                                   Sandton, 2196

William Guy Frawley                 58              Chief Financial Officer     Vunani House Block C
                                                                                   151 Katherine
                                                                                  Street, Sandown,
                                                                                   Sandton, 2196

Butana Mangaliso                    41                       Director           Vunani House Block C
Khoza                                                                              151 Katherine
                                                                                  Street, Sandown,
                                                                                   Sandton, 2196

Andrew Christoffel                  49               Executive Chairman         Vunani House Block C
Nissen                                                                             151 Katherine
                                                                                  Street, Sandown,
                                                                                   Sandton, 2196

Chipo Evelyn                        34                       Director           Vunani House Block C
Chimombe-Munyoro                                                                   151 Katherine
                                                                                  Street, Sandown,
                                                                                   Sandton, 2196
Neil Mark Anderson                 48                     Director           Vunani House Block C
                                                                                151 Katherine
                                                                               Street, Sandown,
                                                                                Sandton, 2196

Bongani Blessing                   54                  Non-executive             14 Ganteeume
Finca *                                                  Director              Crescent, Quigney,
                                                                               East London, 5201

Wilhelm Christian                  62                  Non-executive           5 Inanda Greens,
Ross *                                                   Director              Albertyn Avenue,
                                                                                Wierda Valley,

Andre Francois                     47                  Non-executive          ABSA Towers North,
Pieterse **                                              Director              180 Commissioner
                                                                              Johannesburg, 2000

# German
* Independent non-executive
** Non-executive
All other directors, apart from Chipo Evelyn Chimombe-Munyoro, are South African citizens.

   5.2 Company secretary and registered office are:
       William Guy Frawley, CA (SA)
       Vunani House Block C
       Athol Ridge Office Park
       151 Katherine Street
       Sandown, Sandton, 2196
       (PO Box 652419, Benmore, 2010)

   6.1 Salient features
   6.1.1 The salient features of the private placement are as follows:
           Offer price per ordinary share (cents) 100 Par value per ordinary share (cent) 0.01
           Premium per ordinary share (cents) 99.99
           Number of ordinary shares offered by the 175 000 company for subscription in terms of
           the 000 private placement
           Issue consideration to be received by the R175 Company before expenses
   6.1.2 The opening and closing dates of the private placement are as follows:
           Opening date of the private Tuesday, 20 November placement (09:00) 2007
           Closing date of private placement Wednesday, 21 November (12:00) 2007
           Proposed listing date on ALTx Wednesday, 28 November (09:00) 2007
           These dates are subject to change at the discretion of the company. Any changes will be
           released on SENS.
   6.2 Vunani holds irrevocable undertakings from various selected investors to subscribe for 175
       000 000 shares in terms of the private placement, amounting to 100% of the private
       placement shares.
   6.3 The private placement of 175 000 000 ordinary shares have been fully allocated to the
       investors who have given irrevocable undertakings as set out in paragraph 6.2 above.
    6.4 The placement has not been underwritten and is not subject to a minimum subscription, being

       Subject to the required spread of public shareholders in terms of the Listings Requirements
       being obtained pursuant to the private placement, the JSE has approved the listing of 1 177
       000 000 shares on ALTx with effect from the commencement of business on Wednesday, 28
       November 2007.
       The shares will trade under the abbreviated name "Vunani" and the JSE code "VUN" and
       ISIN ZAE000110359.

       Copies of the prospectus, in English, may be obtained, during business hours, from Tuesday,
       20 November 2007, from the registered offices of Vunani and the offices of Exchange
       Sponsors (Pty) Limited and the transfer secretaries, details of which are set out below:
       • the registered office of the company - Vunani House Block C, Athol Ridge Office Park, 151
           Katherine Street, Sandton, 2196;
       • the offices of Exchange Sponsors (Pty) Limited - 39 First Road, Hyde Park, 2196;
       • the offices of Computershare Investor Services 2004 (Pty) Limited -Ground Floor, 70
           Marshall Street, Johannesburg, 2001.


20 November 2007

Designated Adviser
Exchange Sponsors (Pty) Limited

Auditors and reporting accountants
Deloitte & Touche

Fluxmans Inc.

Corporate Adviser
Vunani Capital (Pty) Limited

Date: 20/11/2007 11:20:01

Produced by the JSE SENS Department.

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