Brikor’s Shareholder Drama Unfolds: Delays, Undertakings, and Increased Guarantees Shake Up Market Dynamic

Shareholders of Brikor Limited are experiencing further delays in the distribution of a crucial circular regarding a mandatory offer, as announced by the company today. The delay comes amid recent acquisitions by Nikkel Trading 392 (Pty) Limited, resulting in Nikkel Trading now owning a significant 68.01% of Brikor’s issued share capital. The mandatory offer, as stipulated by section 123 of the Companies Act, No.71 of 2008, requires Nikkel Trading to extend an offer to the remaining shareholders, each share valued at 17 cents.

Extended Timeline for Circular Distribution

In a series of announcements, shareholders were initially informed of the mandatory offer in the Firm Intention Announcement released on 12 September 2023. Subsequent announcements on 10 October 2023 and 16 October 2023 provided updates on the share acquisition by Nikkel Trading and the delay in the distribution of the circular.

The Takeover Regulation Panel (TRP) granted an extension for the circular distribution until 8 November 2023, citing the need for additional time to ensure accuracy and completeness. Now, a further extension of 15 business days has been granted, pushing the anticipated circular issuance to around 29 November 2023. Shareholders are encouraged to stay abreast of these developments.

Irrevocable Undertaking and Guarantee Increase

A noteworthy aspect of this situation is the involvement of Garnett Parkin, the chief executive officer of Brikor, who currently holds a substantial 107,167,923 Brikor shares. Parkin has entered into an Irrevocable Undertaking with Nikkel Trading, committing not to participate in the mandatory offer. This undertaking is particularly significant as it prevents Parkin from involvement during a closed period of Brikor, as dictated by the JSE Listing Requirements.

The Irrevocable Undertaking is set to expire on Thursday, 30 November 2023. Interestingly, Parkin has communicated his decision not to extend the Irrevocable Undertaking. The aggregate consideration for the mandatory offer, and consequently the final irrevocable bank guarantee(s) to be issued to the TRP, will account for the acquisition of Brikor shares owned by Garnett Parkin.

Directors Responsibility Statement

Both Nikkel Trading and the Brikor Independent Board and Board have issued a responsibility statement in the announcement. In terms of the information in the announcement, Nikkel Trading accepts full responsibility for its accuracy, confirming that the information is true and correct to the best of its knowledge and belief. The statement asserts that the announcement does not omit anything likely to affect the importance of the disclosed information.

Likewise, the Brikor Independent Board and Board accept full responsibility for the accuracy of the information contained in the announcement. They confirm that, to the best of their knowledge and belief, the information is true and correct. The boards further emphasize that the announcement does not omit anything likely to affect the importance of the information disclosed.

Key Dates at a Glance

Table: Key Dates in Brikor’s Mandatory Offer Timeline

Conclusion

As the saga surrounding Brikor Limited’s mandatory offer unfolds, shareholders are urged to closely monitor developments. The extended timeline for the circular distribution, the impending expiration of Garnett Parkin’s Irrevocable Undertaking, and the increased guarantee for the acquisition of Parkin’s shares add layers of complexity to this corporate maneuvering.

The commitment to transparency, as demonstrated by the responsibility statements from Nikkel Trading and the Brikor boards, aims to instill confidence among shareholders. However, the ultimate impact of these developments on Brikor’s corporate landscape remains uncertain until the mandatory offer circular is finally distributed.