NPN
NPN - Naspers Limited - Acquisition of 28,7% economic interest in Digital Sky
Technologies
NASPERS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1925/001431/06)
JSE share code: NPN ISIN: ZAE000015889
LSE ADS code: NPSN ISIN: US 6315121003
("Naspers" or "the company")
ACQUISITION OF 28,7% ECONOMIC INTEREST IN DIGITAL SKY TECHNOLOGIES
1. INTRODUCTION
Shareholders are advised that a subsidiary of Myriad International Holdings
B.V. ("MIH"), an indirect wholly owned subsidiary of Naspers, has entered into
agreements regarding its interest in Mail.ru, the leading Russian internet
communication and gaming company. MIH will exchange its 39,3% stake in Mail.ru
and invest a further US$388m (R2,9bn) cash to obtain a 28,7% economic interest
in Digital Sky Technologies Limited ("DST") (the "transaction").
DST is one of the largest internet companies in the Russian-speaking market.
Upon the close of this transaction, DST will own more than 99,9% of Mail.ru,
the
leading Russian internet communication and gaming company.DST owns ICQ, the
leading instant messaging platform in Russian-speaking markets, and also
holds: more than 75% of Forticom, the social network operator in Russia and
the Baltics; minority stakes in vKontakte, the Russian social network service,
and OE, a payments platform; as well as small interests in global internet
companies such as Facebook, the largest social network, Zynga, the largest
provider of social games, and Groupon, a fast growing social e-commerce
business.
This transaction provides MIH with a significant stake in a leading internet
group with growth potential in Russia and deep understanding of this market.
It also aligns MIH's interests with those of other shareholders of DST.
2. CONSIDERATION
The consideration payable by MIH includes the contribution of its existing
stake in Mail.ru, an investment of US$50m for new shares to be issued by DST
and a further US$338m by MIH to acquire further shares in DST from current
shareholders.
3. FINANCIAL EFFECTS
The table below sets out the unaudited pro forma financial effects of the
transaction and is based on the published, audited results of Naspers for the
year ended 31 March 2010.
The unaudited pro forma financial effects, for which the Naspers board is
responsible, are presented for illustrative purposes only and may not give a
fair reflection of the financial position and results of the operations post
the implementation of the transaction.
Before After
transaction (a) transaction (b) Change
Per share (cents) (cents) (%)
EPS
EPS (cents) 873 1 260 44
Headline EPS (cents) 884 843 (5)
Fully diluted EPS
EPS (cents) 848 1 225 44
Headline EPS (cents) 859 820 (5)
Core Headline EPS (cents) 1 426 1 386 (3)
NAV (cents) 8 993 9 346 4
NTAV (cents) 3 342 3 695 11
Net number of shares in
issue ('000) 374 308 374 308 -
Weighted average number of
shares in issue ('000) 372 951 372 951 -
Fully diluted weighted
average number of shares
in issue ('000) 383 820 383 820 -
Assumptions
(a) The information "Before transaction" is based on the published audited
results of Naspers for the year ended 31 March 2010.
(b) The information "After transaction" is based on the following assumptions:
(i) the transaction was effective from 1 April 2009;
(ii) the total purchase consideration for the 28,7% stake in DST included cash
of US$388m plus the group's 39,3% stake in Mail.ru;
(iii) cash paid was drawn down from the group's existing credit facilities
bearing interest at an average pre-tax rate of 5,5%;
(iv) no tax effect was assumed on the transaction;
(v) income statement information was converted at R7,7123:US$1, being the
average rate for the year ended 31 March 2010;
(vi) balance sheet information was converted at R7,3343:US$1, being the
closing rate on 31 March 2010; and
(vii) the dilution gain of R1,3bn was calculated based on the net book value
of Mail.ru as at 31 March 2010.
(c) The NAV and NTAV per ordinary share "After transaction" is based on the
assumption that the transaction was implemented on 31 March 2010.
(d) The pro forma financial effects do not include the impact of any purchase
accounting adjustments.
Shareholders are advised that the board believes core headline earnings per
share to be an appropriate indicator of sustainable earnings performance. For
a definition of `core headline earnings' we refer shareholders to the annual
financial statements and to our website (www.naspers.com).
4. EFFECTIVE DATE AND CONDITIONS PRECEDENT
The effective date of the transaction will be on fulfilment of the conditions
precedent, which include, inter alia, approvals of various regulatory
authorities.
5. CATEGORY OF TRANSACTION
The transaction has been categorised as a category 2 transaction in terms of
section 9.5(a) of the JSE Limited Listings Requirements.
Cape Town
14 July 2010
Important information:
The report contains forward-looking statements as defined in the United States
Private Securities Litigation Reform Act of 1995. Words such as "believe",
"anticipate", "intend", "seek", "will", "plan", "could", "may", "endeavour"
and similar expressions are intended to identify such forward-looking
statements, but are not the exclusive means of identifying such statements.
While these forward-looking statements represent our judgements and future
expectations, a number of risks, uncertainties and other important factors
could cause actual developments and results to differ materially from our
expectations. These include factors that could adversely affect our businesses
and financial performance. We are not under any obligation to (and expressly
disclaim any such obligation to) update or alter our forward-looking
statements, whether as a result of new information, future events or
otherwise. Investors are cautioned not to place undue reliance on any forward-
looking statements contained herein.
About Naspers:
Naspers comprises a broad-based media group operating in 129 countries. It is
listed on the JSE Limited (JSE), with an ADR listing on the London Stock
Exchange. Today its principal operations are in internet platforms (focusing
on e-commerce, communities, content, communication and games), pay-television
and the provision of related technologies and print media. Most of Naspers's
businesses hold leading market positions. The group's most significant
operations are located in emerging markets.
This includes South Africa and elsewhere in Africa, China, Central and Eastern
Europe, India, Latin America, Russia, Thailand and the Netherlands.
Sponsor
Investec Bank Limited
(Registration number 1969/004763/06)
Corporate adviser
Citigroup Global
Markets Limited
Legal adviser
Wilmer Cutler Pickering
Hale and Dorr LLP
Accountants
PricewaterhouseCoopers Inc
(Registration number 1998/012055/21)
Date: 14/07/2010 07:05:02 Produced by the JSE SENS Department.
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