DATATEC LIMITED - General repurchase of shares announcement

General repurchase of shares announcement

Datatec Limited
Incorporated in the Republic of South Africa
(Registration Number: 1994/005004/06)
JSE share code: DTC
ISIN: ZAE000017745
("Datatec" or the "Company")

GENERAL REPURCHASE OF SHARES ANNOUNCEMENT

1.    INTRODUCTION

      The board of directors of the Company ("Board") hereby advises shareholders that the
      Company, in accordance with the general authority granted by shareholders at the
      Company’s general meeting held on Monday, 15 January 2019 (“General Authority”), has
      cumulatively repurchased from shareholders 11 300 000 ordinary shares (“Shares”) in
      aggregate, representing 5.0% of the Company's issued share capital and the General
      Authority has therefore now been fully utilised.

      On 4 March 2019, shareholders were advised that Datatec had cumulatively repurchased 6
      900 000 ordinary Datatec shares in aggregate under the General Authority, representing
      3.05% of the Company's issued share capital and these shares were subsequently cancelled
      and delisted.

      A further 4 400 000 ordinary Datatec shares, representing 1.95% of the Company’s issued
      share capital, were repurchased during the period commencing 4 March 2019 up to and
      including 21 June 2019 ("Repurchase"). This additional Repurchase brings the total
      repurchased shares under the General Authority to 5.0% of the Company’s issued share
      capital.


2.    DETAILS OF THE REPURCHASE

      Details of the Repurchase are as follows:

      Dates of Repurchase:                                        4 March 2019
                                                                  to 21 June 2019
      Highest repurchase price per Share:                         R 36.00
      Lowest repurchase price per Share:                          R 30.94
      Number of Shares repurchased:                               4 400 000
      Total value of Shares repurchased:                          R 146 148 124

      Total Shares in issue before the Repurchase:              219 200 000
      Total Shares in issue after cancellation of
      repurchased shares:                                       214 800 000
      Number of treasury shares (unchanged):                     650 000

      Application has been made to the JSE to cancel and delist the shares which have been
      repurchased, with effect from Tuesday, 25 June 2019.


3.    STATEMENT BY THE BOARD

      The Board has considered the effect of the Repurchase and is of the opinion that, for a period
      of 12 months following the date of the Repurchase:

      -  the Company and its subsidiaries (the “group”) will be able in the ordinary course of
         business to pay its debts;
     -   the assets of the Company and the group will be in excess of the liabilities of the
         Company and the group. For this purpose, the assets and liabilities were recognised
         and measured in accordance with the accounting policies used in the latest audited
         annual group financial statements;
     -   the share capital and reserves of the Company and the group will be adequate for
         ordinary business purposes;
     -   the working capital of the Company and the group will be adequate for ordinary
         business purposes; and
     -   the Company and the group have passed the solvency and liquidity test and since the
         test was performed, there have been no material changes to the financial position of the
         group.


4.   SOURCE OF FUNDS

     The Repurchase was funded from the Company's available cash resources.


5.   FINANCIAL INFORMATION

     The Company’s cash balances decreased by R146.7 million as a result of the Repurchase
     and, on cancellation of the Repurchase Shares, share capital and share premium will reduce
     by the same amount.

     Interest receivable at rates of approximately 7% per annum (pre-tax) will be foregone on the
     cash resources used to acquire the Repurchase Shares.

     The reduced number of Shares in issue after cancellation of the Repurchase Shares will
     result in a lower weighted average number of shares used to calculate earnings per share in
     future reporting periods.


6.   COMPLIANCE WITH PARAGRAPH 5.72 OF THE LISTINGS REQUIREMENTS

     The Repurchase was effected through the order book operated by the JSE and done without
     any prior understanding or arrangement between the Company and the counter parties. A
     portion of the repurchase programme was executed during the Company’s FY19 results
     closed period. The Company had put in place a repurchase programme and submitted this
     to the JSE in writing prior to the commencement of the closed period. An independent third
     party then executed the repurchase programme, uninfluenced by the Company, during the
     closed period.

     Accordingly, the Company has complied with paragraph 5.72 of the Listings Requirements
     of the JSE.


Johannesburg
25 June 2019

Sponsor
RAND MERCHANT BANK (A division of FirstRand Bank Limited)

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