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38.1 |
Black economic
empowerment shareholding in the South African
group |
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Effective
31 March 2003, Alexander Forbes Empowerment
Holdings (Pty) Limited acquired a 30% equity
interest in Alexander Forbes South Africa
Holdings (Pty) Limited (“AFSA”),
the ultimate holding company for the South
African businesses of the Alexander Forbes
group (excluding associates). The purchase
consideration of R813 million was fully
vendor financed by Alexander Forbes
Limited through the issue of redeemable
C ordinary shares by AFSA to Alexander Forbes
Limited with an after tax dividend yield
of 18% per annum. |
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38.2 |
Deferred vendor
finance payable |
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The deferred vendor finance
payable represents the outstanding capital
on the redeemable C ordinary shares. Each
year, 30% of the headline earnings of AFSA
is used firstly to pay dividends on
the C ordinary shares to Alexander Forbes
Limited and then secondly to redeem capital.
To the extent that the dividend payable,
in any year, on the C ordinary shares exceeds
30% of the headline earnings of AFSA, this
excess is not accounted for as income in
the consolidated results of Alexander Forbes
Limited. To date, no C ordinary share capital
has been repaid.
Certain of the shareholders of Alexander
Forbes Empowerment Holdings (Pty) Limited
have a put option on their shares in AFSA.
Details thereof are provided in the note
on commitments in these financial
statements. |
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