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Declaration and Finalisation Announcement in respect of the Selective Capital Reduction and the Cash Distribution
GRINDROD SHIPPING HOLDINGS LTD.
ABBREVIATED NAME: GRINSHIP
Registered in Singapore with registration number 201731497H
JSE Share code: GSH
ISIN: SG9999019087
Primary listing on NASDAQ Global Select Market
Secondary listing on the JSE Main Board
GRINDROD SHIPPING HOLDINGS LTD. ANNOUNCES DECLARATION AND
FINALISATION ANNOUNCEMENT IN RESPECT OF THE SELECTIVE CAPITAL
REDUCTION AND THE CASH DISTRIBUTION
1 INTRODUCTION
Grindrod Shipping Holdings Ltd. (the "Company") refers to the announcement by the
board of directors (the "Board") dated 4 April 2024 in relation to the proposed selective
capital reduction by the Company pursuant to section 78G of the Companies Act 1967 of
Singapore (the "Selective Capital Reduction") the circular issued by the Company to
shareholders of the Company (the "Shareholders") dated 14 May 2024 (the "Circular")
in relation to the Selective Capital Reduction, the extraordinary general meeting of the
Company held on 20 June 2024 (the "EGM"), and the announcement by the Company
dated 20 June 2024 in relation to the results of the EGM.
As previously announced by the Company in a press release issued on 17 July 2024, the
High Court of the Republic of Singapore approved the Selective Capital Reduction on
Tuesday, 16 July 2024. Accordingly, the Company wishes to provide the following updates
regarding the Selective Capital Reduction.
Capitalised terms not otherwise defined in this announcement ("Announcement") shall
have the meanings ascribed to them in the Circular.
2 EFFECTIVE DATE
The Selective Capital Reduction will take effect upon the lodgement of the Court Order
(including any other documents prescribed by the Companies Act) with the Registrar
within 90 days from the date the Court Order is made (or within such longer period as the
Registrar may allow) (the "ACRA Lodgements"), which the Company intends to make
on 16 August 2024 (the "Effective Date"). Other than the ACRA Lodgements, there are
no outstanding conditions to the Selective Capital Reduction becoming effective.
3 SUSPENSION OF TRADING – NASDAQ
Trading of the Shares on Nasdaq will be suspended with effect on and from 15 August
2024 at 20:00 United States Eastern Daylight Time.
Participating Shareholders who hold Shares listed on Nasdaq as at the Effective Date shall
be entitled to receive the Cash Distribution of US$14.25 per Participating Share.
4 SUSPENSION OF TRADING AND RECORD DATE – JSE
Trading of Shares on the JSE will be suspended with effect on and from Friday, 16 August
2024.
Participating Shareholders who hold Shares listed on the JSE as at Tuesday, 20 August
2024 shall be entitled to receive their Cash Distribution of US$14.25 in the equivalent
amount of ZAR. In this regard, the USD-ZAR exchange rate for the Cash Distribution will
be USD 1: ZAR 18.11500 (the "Selective Capital Reduction Cash Distribution
Payment").
The relevant dates for the selective capital cash distribution payment are as follows:
Last day of trading on Nasdaq Thursday, 15 August 2024
Last day to trade on the JSE to be eligible to Thursday, 15 August 2024
participate in the Selective Capital Reduction and
receive Cash Distribution
Suspension of trading in shares on JSE Friday, 16 August 2024
Effective Date of the Selective Capital Reduction Friday, 16 August 2024
Record date for Cash Distribution for JSE purposes Tuesday, 20 August 2024
Date of payment of the Cash Distribution Wednesday, 21 August 2024
Date of submission of application letter to delist Monday, 26 August 2024
from the JSE
Expected date of delisting of the Company from Monday, 26 August 2024
NASDAQ*
Date of delisting of the Company from the JSE Friday, 30 August 2024
No repositioning of shares between the JSE and the U.S. Register will be allowed between
Thursday, 15 August 2024 and Tuesday, 20 August 2024 (both dates inclusive).
Shareholders registered on the South African section of the share register will not be
allowed to dematerialise or rematerialise their shareholdings between Friday, 16 August
2024 and Tuesday, 20 August 2024 (both dates inclusive).
A further announcement will be made announcing the delisting of the Company from
NASDAQ*
5 ADDITIONAL INFORMATION FOR SOUTH AFRICAN RESIDENT
SHAREHOLDERS OF GRINDROD SHIPPING HOLDINGS LTD.
- Shareholders registered on the South African branch register are advised that the
Selective Capital Reduction distribution of US$14.25 per ordinary share will be
converted to Rands using the USD/Rand spot rate from Nedbank Limited, as
determined on close of business on Thursday, 18 July 2024 of R18.11500. This will
equate to a gross distribution of 25 813.87500 South African cents per share.
Grindrod Shipping Holdings Ltd. tax reference number: 201731497H.
- The Selective Capital Reduction Distribution will be distributed by the Company
and is regarded as a "capital distribution" and is not taxable register.
- Singapore does not impose withholding tax on capital distributions.
- The following is a high-level description of certain South African tax
considerations relating to the receipt or accrual by South African tax resident
shareholders of Grindrod Shipping Holdings Ltd ("GSHL") ("SA
Shareholder(s)") of the distribution to be declared and paid by GSHL as described
herein ("Selective Capital Reduction Distribution"). This information is not a
substitute for independent advice pertaining to the particular circumstances of a SA
Shareholder. It is intended as a general guide only, and is based on current South
African tax legislation in force as at the date of this document, which is subject to
change at any time, possibly with retroactive effect. Any such change could affect
the tax considerations described below. SA Shareholders should consult their own
tax advisors with respect to the South African tax consequences pertaining to the
Capital Distribution. The below description is on the basis that the full amount of
the Capital Distribution received or accrued by the SA Shareholders constitutes a
"foreign return of capital" as defined in section 1 of the Income Tax Act, 58 of
1962.
- The Selective Capital Reduction Distribution should not be subject to dividends
tax.
- If a SA Shareholder holds the GSHL shares as capital assets, the SA Shareholder
will be required to reduce his/her/its base cost in respect of the GSHL shares by the
amount of the Selective Capital Reduction Distribution received or accrued for
capital gains tax purposes. To the extent that the Selective Capital Reduction
Distribution exceeds the base cost of the SA Shareholder, the amount of the excess
must be treated as a capital gain in determining the aggregate capital gain or
aggregate capital loss of the SA Shareholder.
- If a SA Shareholder holds the GSHL shares in terms of a scheme of profit making
or as trading stock, the SA Shareholder should obtain independent tax advice in
respect of the South African tax implications arising from the receipt of the
Selective Capital Reduction Distribution.
For more information, please refer to the Circular.
6 RESPONSIBILITY STATEMENT
The Board (including any Directors who may have delegated detailed supervision of the
preparation of this Announcement) have taken all reasonable care to ensure that the facts
stated and all opinions expressed in this Announcement are fair and accurate and that no
material facts have been omitted from this Announcement, and they jointly and severally
accept responsibility accordingly.
Where any information has been extracted or reproduced from published or otherwise
publicly available sources, the sole responsibility of the Directors has been to ensure
through reasonable enquiries that such information is accurately extracted from such
sources or, as the case may be, reflected or reproduced in this Announcement.
7 FORWARD-LOOKING STATEMENTS
This announcement contains forward-looking statements within the meaning of the Private
Securities Litigation Reform Act 1995 with respect to Grindrod Shipping's financial
condition, results of operations, cash flows, business strategies, operating efficiencies,
competitive position, growth opportunities, plans and objectives of management, and other
matters. These forward-looking statements, including, among others, those relating to our
future business prospects, revenues and income, are necessarily estimates and involve a
number of risks and uncertainties that could cause actual results to differ materially from
those suggested by the forward-looking statements. Accordingly, these forward-looking
statements should be considered in light of various important factors, including those set
forth below. Words such as "may," "expects," "intends," "plans," "believes," "anticipates,"
"hopes," "estimates," and variations of such words and similar expressions are intended to
identify forward looking statements. These forward-looking statements are based on the
information available to, and the expectations and assumptions deemed reasonable by
Grindrod Shipping at the time these statements were made. Although Grindrod Shipping
believes that the expectations reflected in such forward-looking statements are reasonable,
no assurance can be given that such expectations will prove to have been correct. These
statements involve known and unknown risks and are based upon a number of assumptions
and estimates which are inherently subject to significant uncertainties and contingencies,
many of which are beyond the control of Grindrod Shipping. Actual results may differ
materially from those expressed or implied by such forward-looking statements. Important
factors that could cause actual results to differ materially from estimates or projections
contained in the forward-looking statements include, without limitation, Grindrod
Shipping's future operating or financial results; the strength of world economies, including,
in particular, in China and the rest of the Asia-Pacific region; cyclicality of the drybulk
industry, including general drybulk shipping market conditions and trends, including
fluctuations in charter hire rates and vessel values; changes in supply and demand in the
drybulk shipping industry, including the market for Grindrod Shipping's vessels; changes
in the value of Grindrod Shipping's vessels; changes in Grindrod Shipping's business
strategy and expected capital spending or operating expenses, including drydocking,
surveys, upgrades and insurance costs; competition within the drybulk industry; seasonal
fluctuations within the drybulk industry; Grindrod Shipping's ability to employ Grindrod
Shipping's vessels in the spot market and Grindrod Shipping's ability to enter into time
charters after Grindrod Shipping's current charters expire; general economic conditions
and conditions in the coal industry; Grindrod Shipping's ability to satisfy the technical,
health, safety and compliance standards of Grindrod Shipping's customers; the failure of
counterparties to Grindrod Shipping's contracts to fully perform their obligations with
Grindrod Shipping; Grindrod Shipping's ability to execute Grindrod Shipping's growth
strategy; international political conditions, including additional tariffs imposed by China
and the United States; potential disruption of shipping routes due to weather, accidents,
political events, natural disasters or other catastrophic events; vessel breakdowns;
corruption, piracy, military conflicts, political instability and terrorism in locations where
we may operate, including the conflict between Russia and Ukraine; fluctuations in interest
rates and foreign exchange rates and changes in the method pursuant to which the Secured
Overnight Financing Rate and other benchmark rates are determined; changes in the costs
associated with owning and operating Grindrod Shipping's vessels; changes in, and
Grindrod Shipping's compliance with, governmental, tax, environmental, health and safety
regulations; potential liability from pending or future litigation; Grindrod Shipping's
ability to procure or have access to financing, Grindrod Shipping's liquidity and the
adequacy of cash flows for Grindrod Shipping's operations; the continued borrowing
availability under Grindrod Shipping's debt agreements and compliance with the covenants
contained therein; Grindrod Shipping's ability to fund future capital expenditures and
investments in the construction, acquisition and refurbishment of Grindrod Shipping's
vessels; Grindrod Shipping's dependence on key personnel; Grindrod Shipping's
expectations regarding the availability of vessel acquisitions and Grindrod Shipping's
ability to buy and sell vessels and to charter-in vessels as planned or at prices we deem
satisfactory; adequacy of Grindrod Shipping's insurance coverage; effects of new
technological innovation and advances in vessel design; and the other factors set out in
"Item 3. Key Information-Risk Factors" in Grindrod Shipping's Annual Report on Form
20-F for the year ended December 31, 2023 filed with the Securities and Exchange
Commission on March 27, 2024. Grindrod Shipping undertakes no obligation to update
publicly or release any revisions to these forward-looking statements to reflect events or
circumstances after the date of this press release or to reflect the occurrence of
unanticipated events except as required by law.
Company Contact: Investor Relations:
Edward Buttery Email: ir@grindrodshipping.com
CEO
Grindrod Shipping Holdings Ltd.
1 Temasek Avenue, #10-02 Millenia Tower,
Singapore, 039192
Email: ir@grindrodshipping.com
Website: www.grinshipping.com
By Order of the Board
19 July 2024
Sponsor: African Bank Limited (Business and Commercial Banking Division)
Date: 19-07-2024 01:00:00
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