Circ re Group Reorganisation

 
TIDMMGL 
 
Marshall Monteagle Holdings Société Anonyme 
 
           (Incorporated in Luxembourg R.C.S. Luxembourg No. B19600) 
 
                        ("Monteagle" or "the Company") 
 
                       JSE CODE: MTE ISIN: LU0035797272 
 
26 January 2011 
 
 
 
                           CIRCULAR TO SHAREHOLDERS 
 
Introduction 
 
A circular (the "Circular") will be posted to all shareholders of Monteagle 
today containing proposals for a reorganisation of the group and notice of an 
Extraordinary General Meeting ("EGM") of Marshall Monteagle shareholders to 
approve the proposed resolutions to implement the reorganisation of the group. 
In brief the proposals are: 
 
  * the cancellation of the listing of the Company's shares on the Luxembourg 
    Stock Exchange and the London Stock Exchange; 
 
  * the liquidation of the Company and the reorganisation of the Group under a 
    new holding company, Marshall Monteagle PLC ("Newco"); and 
 
  * the application for the Monteagle listing on the JSE to be transferred to 
    Newco, a wholly owned subsidiary of Marshall Monteagle, as a mirror 
    company. 
 
Reorganisation 
 
For some time the Board has been concerned about the costs arising in the 
Company due to it being registered in Luxembourg. Also, as shareholders may be 
aware, the Company benefits under the Luxembourg 1929 Holding Company regime, 
which terminated on 31 December 2010. The Board therefore proposes that the 
Company exits from Luxembourg. The Company cannot migrate from Luxembourg to a 
new jurisdiction as the migration would, under Luxembourg Law, require the 
approval by all shareholders on the Company's register, which will not be 
possible as some of them are untraceable. 
 
On 1 October 2010, the Company sold all of its investments in subsidiaries to 
Newco, resulting in an intercompany balance of US$33,200,000 due from Newco to 
the Company. On 15 November 2010 the Company waived US$2,000,000 of the 
intercompany balance due from Newco in order to create distributable profits in 
Newco. The Company has entered into an agreement with Newco (the "Contribution 
Agreement") under which Newco has undertaken to meet all of the Company's 
liabilities including the costs of liquidation and the Company will sell all of 
its remaining assets to Newco. The Contribution Agreement also provides for 
Newco to settle all amounts due from Newco to the Company by an issue of Newco 
shares. Following the implementation of the Contribution Agreement, Marshall 
Monteagle's only asset will be its shareholding in Newco. Shareholders will be 
requested at an EGM to be held on Friday 18 February 2011 to approve the 
re-organisation and authorise the Liquidator to arrange for these Newco shares 
to be distributed to the shareholders who will receive two Newco shares for 
each Monteagle share held. 
 
The Board has decided on Jersey as the location for the new holding company as 
the Board is of the opinion that it is a convenient and cost efficient 
jurisdiction with a favourable company law regime, and the Company can be 
managed effectively from there. 
 
As far as is practicable, the rights of shareholders in Newco and the 
governance arrangements for Newco mirror those that apply to the Company under 
its articles. A copy of Newco's articles will be available for inspection as 
set out in the Circular. 
 
Subject to approval of the relevant resolutions being passed at the EGM, the 
Board of Newco has applied to the JSE for the Company's listing on the JSE to 
be transferred to Newco. As the JSE listing will be the only listing, it will 
be considered Newco's primary listing. The abbreviated name will be "Marshall", 
JSE code "MMP" and the ISIN Code will be JE00B5N88T08 with effect from the 
commencement of business on Monday, 21 February 2011. 
 
If the proposals are not approved by shareholders, the Company and its listings 
on the Luxembourg Stock Exchange and JSE will remain as they are currently. 
However, as mentioned above, the Luxembourg 1929 Financial Holding Company 
regime ended on 31 December 2010 and the Company's status was automatically 
converted to a société de participations financières, better known as a 
"Soparfi". Conversion to a Soparfi makes the Company taxable in Luxembourg with 
effect from 1 January 2011. 
 
New certificates 
 
Certificated shareholders will be required to complete a form of surrender and 
submit that and their Monteagle share certificate(s) in order to receive their 
new share certificate(s) in Newco. Any new shares not issued will be held on 
the register of Newco in a separate account pending any claims from those who 
do not surrender their certificates. Owners of Monteagle shares dematerialised 
on the South African sub register will automatically be issued shares in Newco 
in dematerialised form. Further details regarding this are set out in the 
Circular. 
 
Cancellation of Luxembourg and London Listings 
 
Trading of the Company's shares on the Luxembourg and London stock exchanges 
over the last few years has been negligible, and so the Company will not be 
seeking as part of the re-organisation to transfer Monteagle's listings on 
these exchanges to Newco. 
 
Almost all of the trades in Monteagle shares in the last few years have been on 
the JSE, so the Board will be seeking as part of the re-organisation to 
transfer the JSE listing from Monteagle to Newco, which transfer has received 
the approval of the JSE. 
 
Under current rules, once Newco has been listed on the JSE for 18 months it 
will become eligible for fast-track admission to AIM (the AIM market operated 
by London Stock Exchange plc). The Board intend to seek admission of Newco 
shares to trading on AIM at that time, as they believe that this market will 
provide better liquidity and be a cost effective way for European shareholders 
to buy and sell Newco shares. Admission to trading on AIM is subject to 
approval by the London Stock Exchange ("LSE"), which approval the LSE is not 
obliged to give. 
 
Shareholders will be asked at the First EGM to approve the cancellation of the 
Luxembourg Stock Exchange listing, and ratify the cancellation of the London 
Stock Exchange listings. The Second EGM will be held to approve the 
liquidator's action. 
 
Subject to the passing of the resolutions as proposed at the first EGM, Newco 
will apply to remain in the "Support Services" subsector of the "Industrial 
Goods & Services" sector of the JSE. The abbreviated name will be "Marshall", 
JSE code "MMP" and the ISIN Code will be JE00B5N88T08 with effect from the 
commencement of business on Monday 21 February 2011. 
 
Yours faithfully 
 
J.M. Robotham 
 
Chairman 
 
 
 
 
 
IMPORTANT DATES AND TIMES 
 
The definitions and interpretations commencing on page 4 of this Circular have 
been used below. 
 
                                                                           2011 
 
Circular and notice of extraordinary general meetings      Wednesday 26 January 
posted to shareholders on 
 
Form of proxy for the First Extraordinary General Meeting Wednesday 16 February 
to be lodged by no later than 10.00 a.m. (CET) on 
 
First Extraordinary General Meeting to be held at 10.00      Friday 18 February 
a.m. (CET) on 
 
Results of the First Extraordinary General Meeting to be     Friday 18 February 
released on SENS, on the LuxSE website and to the LSE 
 
Last day to trade in the shares of the Company               Friday 18 February 
 
Cancellation of listing of shares on the LuxSE and LSE       Monday 21 February 
 
Results of the First Extraordinary General Meeting to be     Monday 21 February 
published in the press in South Africa 
 
Form of proxy for the Second Extraordinary General            Monday 21February 
Meeting to be lodged by no later than 10.00 a.m. (CET)on 
 
Suspension of listing of Monteagle shares on JSE at          Monday 21 February 
commencement of trade; and Listing of Newco shares on JSE 
under the abbreviated name of Marshall, JSE Code MMP and 
ISIN JE00B5N88T08 
 
Second Extraordinary General Meeting to be held at 10.00  Wednesday 23 February 
a.m. (CET) on 
 
Results of the Second Extraordinary General Meeting to be Wednesday 23 February 
released on SENS, on the LuxSE website and to the LSE 
 
Results of the Second Extraordinary General Meeting to be  Thursday 24 February 
published in the press in South Africa 
 
Cancellation of listing of Monteagle shares on the JSE at    Friday 25 February 
commencement of trading; 
 
Record date for shareholders to be on the register in        Friday 25 February 
order to receive certificates in Newco 
 
Issue of Newco share certificates to all shareholders who    Monday 28 February 
have submitted forms of surrender by 12:00 on 18 February 
2011. Dematerialised shareholders will also have their 
accounts updated and credited. 
 
Notes: 
 
1. The above dates and times are subject to change. Any change will be released 
on SENS and published in the press. 
 
2. Share certificates in the name of Monteagle may not be dematerialised on or 
after Friday 18 February 2011 
 
 
 
END
Marshall Mont (LSE:MGL)
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