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Send  Print  Share  RSS  Twitter  17 Nov 2010

Clover to List on JSE


Johannesburg, Nov 17 (I-Net Bridge) - Clover has confirmed its intention to
float its ordinary and preference shares on the JSE.

In a statement on Wednesday, the consumer brand and beverages group said
the listing of the ordinary shares would be implemented together with a capital
raising by the company, through the private placement of new ordinary shares in
Clover with selected eligible investors.

"The net proceeds of the offer of ordinary shares will be used to fund the
company's capital projects (primarily Project Cielo Blu), to repay debt and to
fund potential acquisitions," it said.

A pre listing statement would be published "in due course" providing full
details of the offer of ordinary shares.

Clover operates in South Africa and some African countries.

The company produces and delivers a range of dairy products, non-alcoholic
beverages and other goods through one of the largest distribution networks in
southern Africa.

"Clover was converted from a co-operative society into a public company in
2003 and both its ordinary and preference shares currently trade on an over the
counter market facilitated by the company," the statement added.

The company's primary capital project, Project Cielo Blu, aims to redress
historical inefficiencies in the supply chain, increase profitability and expand
capacity to support current and future growth plans through the relocation of
production facilities closer to milk sources in order to reduce distribution and
related costs and the expansion of key production and distribution centres and
warehouses to create sufficient capacity to support current and future growth
over the next five to seven years.

"Clover's ordinary and preference shares currently trade on an over the
counter market facilitated by the company. "

Following the launch of the offering, Clover said it intended to suspend
trading in the ordinary and preference shares on the over the counter market in
order to facilitate the migration of trade to the main board of the JSE and the
offering of ordinary shares.

"Accordingly, shareholders are advised to exercise due caution in trading
their ordinary and preference shares in the over the counter market."

Clover has appointed Rand Merchant Bank as lead advisor and bookrunner of
the proposed offer of ordinary shares.

"The listing will be a major milestone for Clover.

"As a public company, our corporate and consumer brands will be aligned
and this will contribute positively to the growth of our business as well as
strengthen our position in the markets where we choose to operate," Clover CE
Johann Vorster said.

He added that Clover's financial performance was already benefitting from
its alignment strategy and capital restructuring.

"Despite higher raw milk costs, the company's gross margin increased from
26,3% to 27,8% for the financial year to 30 June 2010."

Contributing factors included an improved product mix, reduced production
and packaging costs and fixed cost cutting initiatives.

The company reported an operating profit adjusted for exceptional items of
320.8 million rand (2009: 48.6 million rand) for the year.

"Moving our production facilities closer to the source and expanding our
distribution platform will save costs and eliminate bottlenecks in the supply

"This will create significant growth opportunities and, because of
Clover's critical mass, enable us to access new markets," Vorster noted.

I-Net Bridge, Tel: +27-11-280-0644,

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