Regulatory news

Prosus N.V.
(Incorporated in the Netherlands)
(Legal Entity Identifier: 635400Z5LQ5F9OLVT688)
AEX and JSE Share Code: PRX ISIN: NL0013654783
(Prosus)

DECLARATION ANNOUNCEMENT IN RESPECT OF THE PROSUS CAPITALISATION ISSUE

1. 1. INTRODUCTION

2. Prosus shareholders (Shareholders) are referred to the annual general meeting of Shareholders held on Wednesday, 23 August 2023 (the Annual General Meeting) where Shareholders were required to inter alia consider and vote on the resolutions required to be approved for Prosus to implement a proposed transaction by Prosus and Naspers Limited (Naspers) in terms of which the cross-holding structure between Prosus and Naspers will be removed (the Proposed Transaction). Capitalised terms not defined in this announcement shall have the meaning given to such terms in the circular posted to Shareholders together with the notice convening the Annual General Meeting on Wednesday, 12 July 2023 (the Circular).

   Shareholders are advised that all the resolutions required to implement the Proposed Transaction were passed at the Annual General Meeting, as detailed in the results announcement published by Prosus on Wednesday, 23 August 2023.  

   Accordingly, as outlined in the Circular, the Board will proceed with the implementation of the Proposed Transaction, subject to the fulfilment of the remaining condition precedent outlined in this announcement. The purpose of this announcement is to provide Shareholders with declaration information on the implementation of the Prosus Capitalisation Issue in accordance with the JSE Listings Requirements. Shareholders are advised to read the Circular (available on Prosus's website www.prosus.com), in conjunction with this announcement, which contains the terms and conditions of the Proposed Transaction, with care and in full.

2. 2. PROSUS CAPITALISATION ISSUE

   Summary of the implementation of the Prosus Capitalisation Issue

   The ultimate outcome of the implementation of the Prosus Capitalisation Issue, following the implementation of the Naspers Capitalisation Issue and the Naspers Share Consolidation, is that Prosus’ holding in Naspers will be diluted to a minimal level. Prosus will hold directly 43,510 Naspers N Ordinary Shares, equating to c. 0.02% of the issued Naspers N Ordinary Shares following the Naspers Share Consolidation. Prosus will sell this minimal holding into the market as soon as possible following completion of the Prosus Capitalisation Issue, the Naspers Capitalisation Issue and the Naspers Share Consolidation. As a result of this sale, the Cross-Holding Structure will be fully removed pursuant to which the Cross-Holding Agreement will terminate in accordance with its existing terms. The Prosus Articles of Association will be amended to remove all references to the Cross-Holding Arrangements.

   In order to achieve this outcome, Prosus will not participate in the Naspers Capitalisation Issue pursuant to the Prosus Waiver while the Naspers Free-Float Shareholders and Naspers A Shareholders will be entitled to receive new Naspers N Ordinary Shares and Naspers A Ordinary Shares, as the case may be, in accordance with the applicable entitlement ratios.

   Similarly, Naspers will not receive any Prosus Ordinary Shares N under the Prosus Capitalisation Issue pursuant to the Naspers Waiver while the Prosus A Shareholders and Prosus N Shareholders will be entitled to receive new Prosus Ordinary Shares A and Prosus Ordinary Shares N, as the case may be, in accordance with the final entitlement ratio in respect of the Prosus Capitalisation Issue (the Entitlement Ratio).

   Terms of the Prosus Capitalisation Issue

   Subject to the terms and conditions set out in the Circular, Prosus intends to implement the Prosus Capitalisation Issue in terms of the Prosus Articles of Association as follows:

   • Prosus will implement a capitalisation issue of Prosus Ordinary Shares N in terms of which Prosus N Shareholders will be issued such number of new Prosus Ordinary Shares N for every Prosus Ordinary Share N held on the Transaction Record Date that following implementation of the Proposed Transaction, Prosus Free-Float Shareholders will hold an economic interest of approximately 57.1% in the NAV of Prosus. The Prosus Ordinary Shares N will upon their issue rank pari passu in all respects with the other Prosus Ordinary Shares N then in issue;
   • Prosus will implement a capitalisation issue of Prosus Ordinary Shares A, in terms of which it will issue such number of Prosus Ordinary Shares A to Prosus A Shareholders in order to maintain the economic interest of Prosus A Shareholders in Prosus that exists immediately prior to implementing the Prosus Capitalisation Issue, while also complying with the voting ratio requirements in terms of article 7.3 of the Prosus Articles of Association; and
   • In terms of article 7.4 of the Prosus Articles of Association, if there is a capitalisation issue of Prosus Ordinary Shares N and/or Prosus Ordinary Shares A in a manner that would result in Naspers, directly or indirectly, holding less than 72% of the aggregate number of issued Prosus Shares, there must be a corresponding capitalisation issue of Prosus Ordinary Shares B in order to maintain the aforementioned 72% holding. Consequently Prosus Ordinary Shares B will be issued to Naspers such that  after the Prosus Capitalisation Issue c. 72% of the aggregate number of issued Prosus Shares will continue to be held, directly or indirectly, by Naspers, in accordance with the terms of the Prosus Articles of Association.

   Shareholders are advised that the Prosus Capitalisation Issue is not proposed to be implemented in lieu of the declaration of any dividend but rather in connection with the Proposed Transaction in terms of which the Cross-Holding Agreement will terminate in accordance with its existing terms. Consequently, the Prosus Capitalisation Issue will be implemented on a pro rata basis to all Prosus N Shareholders, subject to and in accordance with, the terms and conditions set out in the Circular and this announcement, and will not involve an election (including, for the avoidance of doubt, the election to receive cash instead of Prosus Shares pursuant to the Prosus Capitalisation Issue).

   Conditions to the Prosus Capitalisation Issue

   The implementation of the Prosus Capitalisation Issue is subject to Euronext Amsterdam, the JSE Limited, and the A2X granting the necessary approvals for the listing (and any amendments) of Prosus Ordinary Shares N pursuant to the implementation of the Proposed Transaction.

   Implementation of the Prosus Capitalisation Issue

   The Entitlement Ratio will be determined using the principles outlined in paragraph 4.5 of the Circular titled “Key parameters of the Proposed Transaction (calculated/estimated as at 30 June 2023)”, but will be implemented based on the actual Naspers and Prosus share counts as at the Transaction Record Date, and will be announced to Shareholders in the finalisation announcement expected to be issued on Monday, 4 September 2023.  

   For further information on the Prosus Capitalisation Issue, including the rationale, settlement mechanics and indicative share capital impact, Shareholders are referred to paragraph 4.5 of the Circular titled “Key parameters of the Proposed Transaction (calculated/estimated as at 30 June 2023)”, paragraph 4.6 of the Circular titled “Outcome of the Proposed Transaction (calculated/estimated as at 30 June 2023)”, and paragraph 6 of the Circular titled “The Prosus Capitalisation Issue”.

   Fractional Entitlements

   Only whole numbers of Prosus Ordinary Shares N will be issued and, where fractional entitlements to Prosus Ordinary Shares N arise pursuant to the Prosus Share N Capitalisation Issue, such fractions will be rounded down to the nearest whole number with any remaining fractional entitlements to Prosus Ordinary Shares N being sold. The cash proceeds of such fractional entitlements sold on behalf of such Prosus Free-Float Shareholders will be paid to the relevant Prosus Free-Float Shareholder in its brokerage account or to a nominee account to be held on behalf and for the benefit of the relevant Prosus Free-Float Shareholder.

   Prosus ADR Holders

   The Prosus ADR facility will not be excluded from the Prosus Capitalisation Issue and, therefore, The Bank of New York Mellon, as the Prosus ADR Depositary, will participate in the Prosus Capitalisation Issue on behalf of the holders of Prosus ADRs (Prosus ADR Holders).

   Accordingly, the Prosus ADR Depositary will be entitled to receive (on behalf of the Prosus ADR Holders) its aggregate, proportionate entitlement to the Prosus Ordinary Shares N (alongside other Prosus N Shareholders) on a pro rata basis to its aggregate holding of Prosus Ordinary Shares N in respect of which the Prosus ADR Depositary, or its nominee, is the record or registered holder as at the record date of the Prosus Capitalisation Issue.

   As a result, the Prosus ADR facility will be increased on a proportionate basis (for each deposited Prosus Ordinary Share N represented by the relevant number of Prosus ADRs) by the number of additional Prosus Ordinary Shares N, which will be received and deposited by the Prosus ADR Depositary pursuant to its participation in the Prosus Capitalisation Issue and on the terms and conditions set out in the Circular.

   The Prosus ADR Depositary will be required to issue, register and/or deliver the underlying Prosus ADRs in respect of the additional number of Prosus Ordinary Shares N it will receive under the Prosus Capitalisation Issue to the relevant Prosus ADR Holders.

   The Prosus Capitalisation Issue will not change the rights of the Prosus ADR Holders under the deposit agreement dated 16 September 2019 between Prosus, the Prosus ADR Depository, and the Prosus ADR Holders (the Prosus Deposit Agreement) and the ratio of Prosus Ordinary Shares N represented by a Prosus ADR will be unaffected by the Prosus Capitalisation Issue. The Prosus ADR Holders will continue to exercise their rights with respect to the Prosus Ordinary Shares N underlying the Prosus ADRs in accordance with the Prosus Deposit Agreement.

   Exchange Control  

   For information regarding the Exchange Control Regulations applicable to the Prosus Capitalisation Issue, please refer to the summary set out in paragraph 6.5 of the Circular titled "Exchange Control Regulations". Shareholders are also advised to please consult their CSDP, Broker, attorney, accountant, banker or other professional adviser if in any doubt with regard to the Exchange Control Regulations applicable to the Prosus Capitalisation Issue.

   Tax Considerations

   For information regarding South African, Dutch and U.S. tax considerations related to the Proposed Transaction, please refer to the summary set out in paragraph 6.6 of the Circular titled "Taxation".

3. 3. SALIENT DATES OF THE PROPOSED TRANSACTION

   Shareholders were advised in the Circular that applicable dates pertaining to the implementation of the Proposed Transaction would be announced on SENS following the Annual General Meeting. Accordingly, the indicative dates and times relating to the Prosus Capitalisation Issue, which are subject to change and will be confirmed in the finalisation announcement, are as follows:

   	(2023)
   Expected date when the finalisation announcement in relation to the Prosus Capitalisation Issue will be published on SENS, on	Monday, 4 September
   Expected last day to trade in Prosus Ordinary Shares N on the JSE and the A2X prior to the Prosus Capitalisation Issue, on	Tuesday, 12 September
   Expected date when trading in Prosus Ordinary Shares N takes place "ex" the entitlement to participate in the Prosus Capitalisation Issue on the JSE and the A2X, on	Wednesday, 13 September
   Expected last day to trade in Prosus Shares on Euronext Amsterdam prior to the Prosus Capitalisation Issue, on	Wednesday, 13 September
   Expected date when trading in Prosus Ordinary Shares N takes place "ex" the entitlement to participate in the Prosus Capitalisation Issue on Euronext Amsterdam, on	Thursday, 14 September
   Expected date when Prosus will announce the cash value of fractional entitlements to Prosus Ordinary Shares N under the Prosus Capitalisation Issue, for JSE purposes, via SENS and on the A2X via the A2X's News Service before 11:00 (SAST) on	Thursday, 14 September
   Transaction Record date for the Prosus Capitalisation Issue expected to occur on	Friday, 15 September
   Expected date when the Prosus Capitalisation Issue and the listing of new Prosus Ordinary Shares N issued pursuant to the Prosus Capitalisation Issue becomes effective prior to market-open on the Euronext Amsterdam and JSE, on	Monday, 18 September
   Custodian accounts of Shareholders are expected to be updated with their entitlement under the Prosus Capitalisation Issue, on Euronext Amsterdam and on the JSE, as the case may be, on	Monday, 18 September
   Notes: The above dates and times may be amended, subject to the approval of the JSE Limited, if required. Any such amendment will be released on SENS. It is expected that Shareholders will not be allowed to effect any cross-border removals of Prosus Ordinary Shares N between Euronext Amsterdam and the JSE, and vice versa, between Tuesday, 12 September 2023 and Friday, 15 September 2023, both days inclusive. The Circular which sets out the full details of the Proposed Transaction was distributed to Shareholders on Wednesday, 12 July 2023, and is available on the Prosus’s website at www.prosus.com. Shareholders should note that it is expected that the sale of the residual holding of Naspers N Ordinary Shares held by Prosus, pursuant to the Prosus Disposal, will be implemented from Monday, 18 September 2023. All dates and times indicated above are European Central Time, unless otherwise specified.

4. 4. REPURCHASE PROGRAMME

4. Shareholders are referred to the various announcements that have been released pertaining to the ongoing Repurchase Programme.

   As announced on its website on Wednesday, 12 July 2023, in order to have a stable share count for the purpose of the Proposed Transaction, the Repurchase Programme will be temporarily suspended for a short period in order to allow for an efficient and effective implementation of the Proposed Transaction. It is currently anticipated that the Repurchase Programme will be temporarily suspended from Wednesday, 30 August 2023, until Friday, 15 September 2023 (both days inclusive). The repurchase of Prosus Ordinary Shares N pursuant to the Repurchase Programme will resume from Monday, 18 September 2023. Shareholders are advised, however, that these are indicative dates which are subject to change, and these dates will be confirmed in the finalisation announcement to be issued by Prosus in due course. Shareholders will continue to be provided weekly updates on the Repurchase Programme by means of press releases and announcements on SENS and on the Prosus website (www.prosus.com).

Amsterdam, the Netherlands
25 August 2023

JSE sponsor to Prosus: Investec Bank Limited
International Legal Advisor: Allen & Overy LLP
Legal Advisor: Webber Wentzel

Enquiries: