PUBLIC ANNOUNCEMENT UNGA GROUP PLC THE CAPITAL ...

PUBLIC ANNOUNCEMENT UNGA GROUP PLC (Incorporated in the Republic of Kenya (Company No 11/56

THE CAPITAL MARKETS ACT (CAP. 485A of the LAWS OF KENYA) Announcement made Pursuant to Regulation 6(1) of the Capital Markets (Take–overs and Mergers) Regulations, 2002 (“the Take-over Regulations”)

Offer by Seaboard Corporation For shares in Unga Group PLC

1.

2. a.

b.

c.

Introduction The Board of Directors of Unga Group PLC (“Unga”) have, on 20 February 2018, received an Offeror’s Statement pursuant to Regulation 4(4) of the Take-over Regulations from Seaboard Corporation (“Seaboard”), acting in concert with Victus Limited (“Victus”), in respect of the proposed acquisition by Seaboard for all the 46.15% of the issued ordinary shares of Unga not already held by Seaboard and Victus as at the date thereof (the “Take-over Offer”). Seaboard proposes that the Unga ordinary shares will be acquired free from all liens, charges, encumbrances and other interests and together with all rights now and hereafter attaching thereto including the right to receive all dividends and other distributions hereafter declared, made or paid after the date of the Offeror’s Statement. The terms of the proposed Take-over Offer are that each shareholder of Unga will be offered forty Kenya Shillings (KES 40.00) for each ordinary share of Unga. According to the Offeror’s Statement, if the Take-over Offer is declared by Seaboard to be unconditional in all respects, Seaboard intends to propose that the shares of Unga be de-listed from the Nairobi Securities Exchange. Information about the Parties Incorporation and Registered Office Unga is incorporated in Kenya under the Companies Act as a limited liability company (company number 11/56) and is listed on the Nairobi Securities Exchange. The address of its registered office is: Plot No.209/6841, Ngano House, Commercial Street, Industrial Area, P O Box 30096, 00100, Nairobi, Kenya. Seaboard is a public company incorporated in Delaware (registration number 0405526) having its registered office at 9000 West 67th Street, Suite 300, Shawnee Mission, KS 66202, United States of America. Seaboard Corporation is listed on the New York Stock Exchange American and trades under the ticker symbol "SEB". Summary of Offeror's Principal Activities According to the Offeror’s Statement, Seaboard is a vertically integrated conglomerate operating primarily in agribusiness and transportation. In the United States of America ("USA"), Seaboard is currently one of the largest companies engaged in pork production and processing, and also, owns a 50% stake in the largest vertically integrated turkey producer and processor in the USA, Butterball, LLC. Overseas, Seaboard operates in Africa and Latin America through milling operations primarily for commodity merchandising, grain processing and sugar production. Seaboard also has an electric power generation company in the Dominican Republic, a significant Marine division and several agricultural based operations. Share Capital and Ownership According to the Offeror’s Statement, as at 30 September 2017, the authorised share capital of Seaboard comprised 1,250,000 shares of US$1.00 each. The issued and outstanding shares are currently 1,170,550 shares of common stock of US$1.00. All of the issued shares are fully paid.

d.

Shareholders of Seaboard Corporation According to the Offeror’s Statement, 909,529.24 shares of Seaboard Corporation, representing 77.7% of all the authorised, issued and outstanding shares in the company, are beneficially owned by the family of Steven J. Bresky, who have been investors in flour milling since 1918 originally in the United States and since the 1960s in Africa and Latin America. The shareholding structure is as presented in the table below: Name and Address of Beneficial Owner

Amount and Nature of Ownership 909,529.24

Steven J. Bresky Seaboard Flour LLC*

465,825.69

SFC Preferred LLC*

428,122.55

HAB Grandchildren's Trust B

1,775.00

SJB SEB LLC*

4,661.00

Bresky Foundation

4,250.00 3,120.00

HAB 2011 Gift Trust

63,312.00

FMR LLC* Others** Total * Shares held on behalf of the family Steven J. Bresky. ** Shares listed and publicly held

5.4%

197,708.80

16.9%

1,170,550,00

100.0%

Board of Directors of Seaboard Corporation Name

Nationality

Address

American

Seaboard Corporation, 9000 West 67th Street, Merriam, KS 66202, USA.

American

Seaboard Corporation, 9000 West 67th Street, Merriam, KS 66202, USA,

David Adamsen* Director

American


Douglas Baena* Director

American


American

Seaboard Flour, 1320 Centre St., Ste. 200 Newton Center MA 02459-2400, USA.

Steven Bresky Director and Board Chairman Edward Shifman Jr.* Director & Board Chairman Director

Paul Squires Director * Audit Committee Members

f.

77.7%

1,775.00

HAB Grandchildren's Trust A

e.

Percentage of Class

Seaboard Subsidiaries Seaboard has the following principal subsidiaries across the world: i. Pork Segment Jurisdiction

Subsidiaries

Percentage Interest

Seaboard Foods LLC

Kansas, Oklahoma, USA

100%

2.

High Plains Bioenergy, LLC

Oklahoma, USA

100%

3.

Seaboard de Mexico

Mexico

100%

4.

Daily’s Premium Meats, LLC

Utah, Montana, Missouri, USA

50%

5.

Seaboard Triumph Foods, LLC

Iowa, USA

50%

1.

ii. Commodity Trading and Milling Jurisdiction

Subsidiaries and Affiliates

Percentage Interest

1.

Unga Holdings Limited

Kenya

35%

2.

Africa Poultry Development Limited

Mauritius

49%

3.

Akdeniz Yaglari Sanayi ve Tecaret A.S.

Turkey

25%

4.

Bag Yaglari Sanayi ye Tecaret A.S.

Turkey

25%

5.

Bagin Yag Sanayi Tesisleri imalat ve Isletmeciligi A.S.

Turkey

25%

1

Beira Grain Terminal, S.A.

Mozambique

55%

7.

Belarina Alimentos S.A.

Brazil

98%

8.

Bolux Group Proprietary Limited

Botswana

9.

Borisniak Corporation

Panama

6.

1

49% 100%

10. Compania Industrial de Productos Agreopecuarious SA

Costa Rica

11. Eurafrique

Monaco

12. Flour Mills of Ghana Limited

Ghana

13. Gambia Milling Corporation Limited

Gambia

50%

14. National Milling Company of Guyana Inc.

Guyana

100%

15. Les Moulins d'Haiti S.E.M.

Haiti

16. Les Grands Moulins de Dakar

Senegal

17. Lesotho Flour Mills Limited

Lesotho

50%

18. Life Flour Mill Limited

Nigeria

48.33%

19. LMM Farine, S.A.

Madagascar

100%

20. Minoterie du Congo, S.A.

Republic of Congo

100%

21. Minoterie du Matadi, S.A.R.L.

DRC

50%

22. Moderna Alimentos, S.A.

Ecuador

25%

23. Molinos Champion, S.A.

Ecuador

50%

24. National Milling Corporation Ltd.

Zambia

100%

25. Paramount Mills (Pty) Ltd.

South Africa

26. Rafael del Castillo & Cia. S.A

Colombia

27. Société Africaine de Developpement Industriel Alimentaire, S.P.R.I,

DRC

28. Société Mediterraneenne de Transport

Monaco

98.82%

29. Société Les Grands Moulins d’Abidjan

Ivory Coast

98.25%

30. Zalar Holdings S.A.

Morocco

19.37%

42% 98.83% 100%

23.33% 98.9%

49% 41.42% 50%

Unga holds the remaining 65% stake

iii. Marine Jurisdiction


Percentage Interest

Seaboard Marine Ltd

Liberia

100%

2.

Agencia Maritima del lstmo, S.A.

Costa Rica

100%

3.

Cayman Freight Shipping Services

Cayman Islands

4.

JacintoPort International LLC

Texas, USA

5.

Kingston Wharves Limited

Jamaica

21%

6.

Lafito Logisitics Holdings, Ltd.

Bahamas

36%

7.

Representaciones Maritimas y Aereas, S.A.

Guatemala

100%

8.

Sea Cargo, S.A.

Panama

100%

9.

1.

40% 100%

Seaboard de Colombia, S.A.

Colombia

100%

10. Seaboard de Nicaragua, S.A.

Nicaragua

100%

11. Seaboard del Peru, S.A.

Peru

100%

12. Seaboard Freight & Shipping Ltd

Jamaica

13. Seaboard Honduras, S.de R.L.de C.V.

Honduras

14. Seaboard Marine (Trinidad) Limited

Trinidad, Tobago

15. Seaboard Marine of Haiti, S.E.

Haiti

16. Seadom, S.A.

Dominican Republic

17. SeaMaritima S.A. de C.V.

Monaco

55% 100% 40% 100% 50% 100%

iv. Others Jurisdiction


Percentage Interest

Sugar 1. 2.

Alconoa S.R.L.

Argentina

100%

Ingenio y Refineria San Martin de Tabacal SRL

Argentina

100%

Power 1.

Transcontinential Capital Corp. Ltd

Bermuda

100%

2.

La Compania de Electricidad de San Pedre de Macrois

Dominican Republic

29.9% 50%

Others 1.

Butterball LLC

North Carolina, USA

2.

Mount Dora Farms de Honduras, S.R.L.

Honduras

100%

3.

Mount Dora Farms Inc.

Florida, USA

100%

*The information provided above is as at 20 February 2018, according to the Offeror’s Statement ** A comprehensive list of all Seaboard subsidiaries and affiliated companies can be obtained from www.sec.gov

3. a.

b.

c.

4.

5.

Current holdings, undertakings and persons acting in concert, and agreements with directors Existing Interest of Seaboard in Unga As at 30 June 2017, the issued share capital of Unga comprises 75,706,986 ordinary shares of KES 5.00 each, all of which are voting shares. Seaboard holds indirectly 2,210,400 ordinary shares of KES 5.00 each in Unga (representing 2,92% of the issued share capital of Unga), currently held as nominee through CFC Stanbic Financial Services Limited, and is acting in concert with Victus Limited which holds 38,557,190 ordinary shares of KES 5.00 each in the company (representing approximately 50.93% of the issued share capital). Undertakings and persons acting in concert According to the Offeror’s Statement, Victus, which currently holds a 50.93 per cent majority stake (38,557,190 ordinary shares) in Unga, has irrevocably undertaken to support the Take-over Offer as a concert party and does not wish to increase its present shareholding. Aside from this undertaking, according to the Offeror’s Statement, neither Seaboard, nor Victus, or any related company or person associated with the Seaboard, has received an undertaking to accept the Take-over Offer from any holder of ordinary shares of Unga. Agreements with directors According to the Offeror’s Statement, save as regards the irrevocable undertaking of Victus to support the Take-over Offer (as described above), there is no agreement between Seaboard and any director of Unga in connection with or conditional upon the outcome of the Take-over Offer nor is it proposed in connection with the Take-over Offer that any payment or other benefit be made or to be given to any director of Unga or of any company related to it as consideration for, or in connection with, such director's retirement from office. Compulsory acquisition and delisting of Unga As noted above, according to the Offeror’s Statement, if the Take-over Offer is declared by Seaboard to be unconditional in all respects, Seaboard intends to propose that the shares of Unga be de-listed from the Nairobi Securities Exchange. Unga’s shareholders who do not wish to accept the Take-over Offer and whose shares are not acquired in the circumstances provided in section 210 of the Companies Act (Cap 486) will, in such an event, remain minority shareholders in an unlisted company, thereby limiting the liquidity in the trading of their shares. Unga shareholders shall at the appropriate time be notified of an extraordinary general meeting of the shareholders to discuss, and if thought fit, approve the de-listing of shares of Unga from the Nairobi Securities Exchange, subject to the Take-over Offer being successful. The terms and conditions of the Take-over Offer The terms of the proposed Take-over Offer are that each shareholder of Unga will be offered forty Kenya Shillings (KES 40.00) for each ordinary share of Unga. According to the Offeror’s Statement, the forty Kenya Shillings (KES 40.00) offer price represents a premium, as of 6 February 2018 which was the last business day practicable prior to the submission of the Notice of Intention (the "Value Date"), of:



40.35% to the closing price of KES 28.50 per Unga share as of the Value Date.



38.86% to KES 28.81, being the 30-day volume-weighted average price per Unga Share as of the Value Date.



28.59% to KES 31.11, being the 90-day volume-weighted average price per Unga Share as of the Value Date.



6.

31.75% to KES 30.36, being the 250-day volume-weighted average price per Unga Share as of the Value Date. The total consideration for the Take-over Offer, assuming Seaboard receives acceptances from all the Unga minority shareholders, is estimated to be approximately KES 1.397 billion. According to the Offeror’s Statement, CBA Capital Limited, Seaboard’s financial advisor and sponsoring broker has confirmed that Seaboard has sufficient resources and facilities at its disposal to satisfy full acceptance of the Take-over Offer. According to the Offeror’s Statement, completion of Seaboard’s Take-over Offer will be subject to fulfilment (or waiver at the discretion of Seaboard where appropriate) of the following conditions: a) the board of directors of Unga recommending that shareholders of Unga accept the Take-over Offer; b) Seaboard receiving acceptances of the Take-over Offer on or prior to the Closing Date in respect of ordinary shares of Unga that, when aggregated with the shares of Unga held by Seaboard and Victus, represent not less than ninety percent (90%) of the issued ordinary shares of Unga. If the 90% threshold is not achieved but a threshold of 75% or more is achieved in aggregate, Seaboard may, at its discretion, proceed to closing; c) no governmental, revenue collection or regulatory body having decided to take any action or proceedings or make an investigation which might: i. make the acquisition of ordinary shares of Unga pursuant to the Take-over Offer void or illegal; ii. impose any restriction on the ability of Unga to carry on its business as the same was carried on prior to the date of this notice; or iii. otherwise materially affect the business profits or prospects of Unga or Seaboard; d) there being no material adverse change in the trading prospects or financial situation of Unga; e) no material litigation or other legal proceedings having been commenced against Unga; f) no material adverse change occurring in the Kenyan or international financial markets resulting from an outbreak of hostilities or escalation thereof involving Kenya, an act of terrorism or war, civil war, riots, unrest or other calamity or crisis or a change, or development involving a prospective change, in national or international financial, political or economic conditions, or currency exchange rates or exchange controls, which in each case, affects the willingness of Seaboard to acquire the shares of Unga not already beneficially owned by and/or registered in the name of Seaboard and Victus; and g) the Take-over Offer being completed by no later than 30 September 2018, or such later date as may be agreed between Seaboard and Unga, with the approval of the CMA. Documentation and timetable The Take-Over Offer will be set out in an offer document (“Offer Document”) that complies with the Takeover Regulations and will include a timetable for the transaction by which shareholders of Unga will have to accept the Take-over Offer within 30 (thirty) days or such longer period as may be agreed by Seaboard and Unga and approved by the Capital Markets Authority (the “Closing Date”). Unga shareholders will receive a comprehensive set of documents in connection with the proposed Take-over Offer, including (i) the Offer Document; (ii) a form of acceptance; (iii) a shareholders circular issued by the board of directors of Unga, indicating whether or not the board of directors of Unga recommend to Unga shareholders to accept the Take-over Offer and including an opinion from an independent financial adviser issued pursuant to Regulation 10 of the Take Over Regulations; and (iv) a notice to convene an EGM of Unga shareholders to discuss, and if thought fit, approve the delisting of the Unga shares from the NSE. Guidance will be provided in these documents on what Unga shareholders would need to do in order to accept the Takeover Offer.

7. a. b.

c.

Miscellaneous According to the Offeror’s Statement, Seaboard intends to acquire and retain all the shares and to continue carrying on the business of Unga. No part of the Take-over Offer consideration will be in the form of a share swap with Seaboard and the consideration to be offered in exchange for shares of Unga does not consist in whole or in part of marketable securities issued or to be issued by Seaboard or by any company. According to the Offeror’s Statement, there is no agreement or arrangement by which shares acquired by Seaboard in pursuance of the scheme will or may be transferred to any other person.

Dated 22 February 2018 By order of the Board For and on behalf of Unga Group PLC

Winnie Jumba, Company Secretary