South African listed short-term insurer Mutual & Federal (MAF) has made an offer to acquire the 65% interest in Credit Guarantee Insurance Corporation of Africa ltd (CGIC) that it does not already own for a cash consideration of R198,486-million, equating to R112 per CGIC share, Mutual & Federal announced on Thursday.
If more than 90% of CGIC shareholders accept the offer, Mutual & Federal said it intended to invoke section 440k of the Companies Act to acquire compulsorily the remaining shares. The offer was not, however, conditional upon such acceptance, or any other, being achieved, it added.
Mutual & Federal said it was obliged to extend the offer to CGIC shareholders after it acquired Fedsure’s 6,23% interest in CGIC for cash at the offer price on April 16, which pushed its total shareholding in CGIC to above the 35% level.
Once an entity holds more than 35%, it is obliged to extend an offer to all other shareholders under the Securities Regulation Code on Takeovers and Mergers and Rules of the Securities Regulation Panel (SRP).
The offer is subject to the relevant regulatory approvals as well as that of shareholders. – I-Net Bridge