Fin24

Due diligence for Avusa bid

2011-05-16 18:31

Johannesburg - Media and entertainment group Avusa [JSE:AVU] is to allow a consortium, from which it has received an expression of interest to acquire it, to undertake a four-week due diligence investigation, it said on Monday.

The conditions for being allowed to undertake the due diligence included an undertaking that the consortium, represented by Capitau Holdings, will deliver a firm intention to make an offer within four weeks, Avusa said.

It said that after receipt of the expression of interest, its board had established an independent sub-committee to consider the expresion of interest and engage with the consortium.

Avusa said that the expression of interest was early-stage and non-binding and subject to various conditions.

It was not a formal offer and/or a firm intention to make an offer.

"Notwithstanding the aforementioned, the independent sub-committee, in executing its fiduciary duties to the company in relation to giving appropriate consideration to the EoI (expression of interest), commenced a process of engagement with the consortium," it said.

It expected the due diligence to start in early June.

"Shareholders are advised that by allowing the sonsortium to conduct the due diligence, the independent sub-committee has not yet concluded that the proposed acquisition is in the best interests of the Company and its shareholders and therefore should be supported by the board," Avusa said.