Acquisition of subsidiary

Shares in the following subsidiary were acquired during the year ended 31 May 2012

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		Effective date of acquisition		% acquired
Multiserv Proprietary Limited		1 January 2012		100

Details of the total net assets disposed and the resulting loss on disposal is as follows.		Total R’000
Total purchase consideration		8 933
Fair value of net assets acquired		3 086
Goodwill		5 847
The assets and liabilites acquired through acquisition are as follows:		Fair value at acquisition date R’000
Cash and cash equivalents		739
Property, plant and equipment		370
Intangible assets*		5 481
Loans receivable		2 091
Inventories		1 552
Receivables		1 212
Current tax assets		143
Deferred tax liability*		(1 512)
Borrowings		(5 210)
Payables		(1 780)
Fair value of net assets acquired		3 086
Cash and cash equivalents in subsidiary acquired		739
Total purchase consideration		(8 933)
Less loans acquired		(5 068)
Cash outflow on acquisition		(13 262)

*	Intangible assets include R5,4 million of franchise fees which relates to the purchase price allocation performed in terms of IFRS3(R) – Business Combinations. Deferred tax to the value of R1,5 million was raised on recognition of this intangible asset.

Multiserv Proprietary Limited was purchased with the objective of utilising their national footprint as a platform for the group’s strategy of marketing its products and services on a retail basis.