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Published on Monday, 11 February 2008

Cleansing Notice

Cleansing Notice

 
A.C.N. 063 656 333
A.B.N. 64 063 656 333
VIETNAM INDUSTRIAL INVESTMENTS LIMITED
 
11 February 2008
 
 
Company Announcements Office
ASX Limited
Exchange Plaza
2 The Esplanade
PERTH WA 6000
 

Dear Sirs

CLEANSING NOTICE
Section 708 AA(2)(f) of the Corporations Act 2001 (Cth)

Vietnam Industrial Investments Limited (the Company) announced on 29 January 2008 that it is making a renounceable pro rata rights issue (Rights Issue) to Shareholders whose registered addresses are situated in Australia or New Zealand (Eligible Shareholders) who are registered at 5.00 pm (AWDST) on 6 February 2008.

Pursuant to the Rights Issue, the Company may issue a maximum of 51,660,000 fully paid ordinary shares in the capital of the Company (New Shares) at an issue price of A$0.15 each, to raise a maximum of approximately A$7,749,000 (before expenses of the issue). The New Shares will be offered (Offer) on the basis of one (1) New Share for every two (2) fully paid ordinary shares held in the capital of the Company (Shares) .

As referred to in the timetable announced on 29 January 2008, an Offer Document will be despatched to all Shareholders together with an Entitlement and Acceptance Form on 12 February 2008.

NOTICE UNDER s708AA OF THE CORPORATIONS ACT 2001 (CTH)

Pursuant to section 708AA(2)(f) of the Corporations Act 2001 (Cth) (Act), the Company hereby states:

1) The Company will offer the New Shares for issue without disclosure to investors under Part 6D.2 of the Act;

2) The Company is providing this notice under s708AA(2)(f) of the Act;

3) As at the date of this notice, the Company has complied with:

a) the provisions of Chapter 2M of the Act as they apply to the Company; and

b) section 674 of the Act; and

4) As at the date of this notice, there is no information:

(a) that has been excluded from a continuous disclosure notice in accordance with the ASX Listing Rules (Listing Rules); and

(b) that investors and their professional advisers would reasonably require for the purpose of making an informed assessment of:

(i) the assets and liabilities, financial position and performance, profits and losses and prospects of the Company; or

(ii) the rights and liabilities attaching to the New Shares.

5) The Offer may impact on the control of the Company. Below is some information on the impact that the Offer may have on the control of the Company.

The current relevant interests of the two largest shareholders of the Company are as follows:
(a) Corbyns International Limited ARBN 126 976 529 (Corbyns) and its Associates (as that term is defined in the Act): 75.59% (comprising 77,539,007 Shares held by Corbyns and 561,280 Shares held by Mr Henry Van Hung Lam, who is an Associate of Corbyns, out of a total of 103,320,002 Shares currently on issue in the Company as at the date of this notice); and
(b) Land & General Berhad Company Number 5507-H, a company with a registered address in Malaysia and its Associates: 12.58% (comprising 13,002,000 Shares out of the total of 103,320,002 Shares currently on issue in the Company as at the date of this notice).
Corbyns has confirmed to the Company that it intends to take up all of its entitlement to subscribe for New Shares pursuant to the Offer as an Eligible Shareholder with respect to its holding of 77,539,007 Shares. Corbyns may not purchase any further rights to subscribe for New Shares pursuant to the Offer (Rights) that may be sold on the ASX.
In the event that Corbyns takes up all of its entitlement under the Offer, VII will raise a minimum of approximately A$5,815,425 (before costs).

The maximum increase in Corbyns' and its Associates' relevant interest by reason of their entitlement to subscribe for New Shares pursuant to the Offer will be 6.66% (bringing their relevant interest to approximately 82.25%).

The following table shows the number of issued Shares at the date of this notice and the total number of issued Shares at the close of the Offer based on the maximum total New Shares that may be issued under the Offer.

Ordinary New Shares Number
Issued Shares at the date of the Offer Document 103,320,002
Maximum number of New Shares offered under the Offer Document 51,660,000
Total issued Shares at the close of the Offer 154,980,002

An analysis of the changes in control has been undertaken to indicate the effect on Corbyns' (and its Associates') and Land & General Berhad's (and its Associates') total relevant interests in the Company under various scenarios. The results are detailed below.

Before Offer

The following table shows the existing capital structure of the Company at the date of this notice.

Shareholder Shares % of Total Shares
Corbyns International Limited and Associates 78,100,287 75.59%
Land & General Berhad and Associates 13,002,000 12.58%
Others 12,217,715 11.83%
Total 103,320,002 100%

Scenario 1 - Maximum Entitlement take up

The following table shows the capital structure of the Company if each Eligible Shareholder elects to take up all of their entitlement to subscribe for New Shares pursuant to the Offer (Entitlement) and the Rights that would have been offered to Shareholders whose registered addresses are not situated in Australia or New Zealand (Excluded Shareholders) are sold by the ASIC-approved nominee (in a process set out in the Offer Document) to purchasers who take up all their Entitlement.

Shareholder Shares % of Total Shares
Corbyns International Limited and Associates 117,150,430 75.59%
Land & General Berhad and Associates 13,002,000 8.39%
Others 24,827,572 16.02%
Total 154,980,002 100%

Scenario 2 - Corbyns takes up 100% of its Entitlement, all other Eligible Shareholders take up 50% of their Entitlement and 50% of Rights of Excluded Shareholders lapse

The following table shows the capital structure of the Company in the event that:

(a) other than Corbyns, all Eligible Shareholders; and
(b) all purchasers who purchase, from the ASIC-approved nominee, the Rights that would have been offered to Excluded Shareholders,
each elect to contribute half of their respective Entitlements and Corbyns elects to take up all of its Entitlement under the Offer as an Eligible Shareholder.
Shareholder Shares % of Total Shares
Corbyns International Limited and Associates 117,010,110 78.78%
Land & General Berhad and Associates 13,002,000 8.75%
Others 18,522,643 12.47%
Total 148,534,753 100%

Scenario 3 - Corbyns takes up 100% of its Entitlement, Nil take up by Eligible Shareholders and all Rights of Excluded Shareholders lapse

The table below shows the capital structure of the Company where:
(a) all Eligible Shareholders (other than Corbyns) elect not to take up their Entitlement and all their Rights are allowed to lapse; and
(b) all the Rights of the Excluded Shareholder are allowed to lapse.

Shareholder Shares % of Total Shares
Corbyns International Limited and Associates 116,869,790 82.25%
Land & General Berhad and Associates 13,002,000 9.15%
Others 12,217,715 8.60%
Total 142,089,505 100%

It is not expected that this change in the percentage holding by Corbyns will have any material consequences on the control of the Company.

Future intentions of Corbyns

Corbyns has no present intention to divest any Share it holds following the Offer.
Set out below are Corbyns' present intentions with respect to the Company's business and strategy following the Rights Issue.

ASX Listing
Subject to maintaining a sufficient spread of Shareholders, Corbyns intends to retain the listing of the Company on the ASX.
Limitation on intentions

The implementation of Corbyns' present intentions for the Company, will be subject to the law (including the Act), the Listing Rules and the Company's constitution.
In particular, the requirements of the Act and the Listing Rules in relation to conflicts of interest and "related party" transactions will apply given that Corbyns will be treated as a related party of the Company.

Corbyns has confirmed it would only make a decision on its courses of action in these circumstances after it receives appropriate legal and financial advice on such matters and, where required, including in relation to any requirements for Shareholder approval.
It is the present intention of Corbyns to procure that the Company will:
(i) generally continue the businesses of the Company;
(ii) not make any major changes to the business of the Company nor redeploy any of the fixed assets of the Company; and
(iii) continue the employment of the Company’s present employees.
The intentions and statements of future conduct set out in this notice must be read as being subject to the legal obligation of the Directors of the Company at the time, including any nominees of Corbyns, to act in good faith in the best interest of the Company and for the proper purposes and to have regard to the interests of the Shareholders.

Yours faithfully

Alan Young
Managing Director & Chief Operating Officer

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