REMGRO LIMITED
Incorporated in the Republic of South Africa
(Registration number: 1968/006415/06)
ISIN: ZAE000026480
JSE and A2X share code: REM
(“Remgro”)

DISTRIBUTION OF SHAREHOLDING IN GRINDROD LIMITED (“GRINDROD”), CASH PROCEEDS
IN RESPECT OF FRACTIONAL ENTITLEMENTS AND APPORTIONMENT OF TAX COST FOR
SOUTH AFRICAN TAX PURPOSES


1.     INTRODUCTION

Holders of Remgro no par value ordinary shares and Remgro unlisted no par value B ordinary shares
(“Remgro Shareholders”) are referred to the detailed declaration and finalisation announcement
released by Remgro on the Stock Exchange News Service on 26 September 2022
(“Terms Announcement”) regarding the unbundling by way of a dividend in specie of the 174,507,905
no par value ordinary shares in Grindrod (the “Unbundled Grindrod Shares”) to Remgro Shareholders.
Remgro Shareholders will, pursuant to the dividend in specie, become entitled to Unbundled Grindrod
Shares in the ratio of 30.70841 Unbundled Grindrod Shares for every 100 ordinary share and every 100
class B ordinary share, respectively, in Remgro (“Remgro Shares”) (the “Remgro Unbundling”). The
Remgro Unbundling constitutes an unbundling transaction in terms of section 46 of the South African
Income Tax Act, No. 58 of 1962 (“Income Tax Act”).

2.     PURPOSE OF THE ANNOUNCEMENT

The purpose of this announcement is to advise of the following:

2.1.   the closing prices of both the Unbundled Grindrod Shares and Remgro Shares on Wednesday,
       12 October 2022, the day the Remgro Shares began trading “ex” the entitlement to receive the
       Unbundled Grindrod Shares;

2.2.   the ratio at which the expenditure incurred and/or the market value (for purposes of paragraph 29
       of the Eighth Schedule to the Income Tax Act) (“Market Value”) in respect of the Remgro Shares
       must be apportioned between the Remgro Shares and the Unbundled Grindrod Shares for South
       African taxation purposes (“Apportionment Ratio”); and
2.3.   the value to be utilised in determining the cash payment due to a Remgro Shareholder in respect
       of any fractional entitlement in respect of the Unbundled Grindrod Shares to which such
       shareholder may be entitled (“Cash Proceeds”).


3.     APPORTIONMENT RATIO TAX PRINCIPLES

3.1.   Remgro Shareholders will have a combined expenditure in respect of the Remgro Shares and
       the Unbundled Grindrod Shares received pursuant to the Remgro Unbundling.

3.2.   Remgro Shares held as trading stock: Any Remgro Shareholder holding Remgro Shares as
       trading stock will be deemed to acquire the Unbundled Grindrod Shares as trading stock. The
       combined expenditure of such Remgro Shares and Unbundled Grindrod Shares will be the
       amount taken into account by the Remgro Shareholder in respect of those Remgro Shares, as
       contemplated in section 11(a), section 22(1), or section 22(2) of the Income Tax Act. The portion
       of the above-combined expenditure to be allocated to the Unbundled Grindrod Shares will be
       determined by applying the ratio that the Market Value of the Unbundled Grindrod Shares bears
       to the sum of the Market Value of the Remgro Shares and the Unbundled Grindrod Shares at the
       end of the first business day after the last day to trade date (“LDT Date”), being Wednesday,
       12 October 2022 (on the basis that the LDT Date was Tuesday, 11 October 2022). The
       expenditure so allocated to the Unbundled Grindrod Shares will reduce the expenditure relating
       to the retained Remgro Shares.
3.3.   Remgro Shares held as capital assets: Any Remgro Shareholder holding Remgro Shares as
       capital assets will be deemed to acquire the Unbundled Grindrod Shares as capital assets. The
       combined expenditure of such Remgro Shares and Unbundled Grindrod Shares will be the
       original expenditure incurred in respect of the Remgro Shares, that is allowable in terms of
       paragraph 20 of the Eighth Schedule to the Income Tax Act, and where the Remgro Shares were
       acquired before 1 October 2001, the expenditure and/or Market Value, as the case may be,
       adopted or determined as contemplated in paragraph 29 of the Eighth Schedule to the Income
       Tax Act. The portion of the above-combined expenditure and/or Market Value, as the case may
       be, to be allocated to the Unbundled Grindrod Shares will be determined by applying the ratio
       that the Market Value of the Unbundled Grindrod Shares bear to the sum of the Market Value of
       the Remgro Shares and the Unbundled Grindrod Shares at the end of the first business day after
       the LDT Date, being Wednesday, 12 October 2022 (on the basis that the LDT Date was Tuesday,
       11 October 2022). The expenditure and/or Market Value, as the case may be, so allocated to the
       Unbundled Grindrod Shares will reduce the expenditure and/or Market Value, as the case may
       be, of the retained Remgro Shares.

3.4.   Remgro Shareholders are advised to consult their own professional tax advisors should they
       have any queries regarding the taxation consequences of the Remgro Unbundling and the
       calculation of their costs for taxation purposes.

4.     APPORTIONMENT RATIO CALCULATION

4.1.   Remgro Shareholders are further referred to paragraph 8.4.6 of the Terms Announcement, which
       require Remgro to advise Remgro Shareholders of the Apportionment Ratio.

4.2.   Remgro Shareholders are hereby advised that the Apportionment Ratio is based on the closing
       price of 13174.00000 cents per Remgro Share and 873.00000 cents per Unbundled Grindrod
       Share on 12 October 2022.

       The Apportionment Ratio applicable to the Unbundled Grindrod Shares has therefore been
       calculated as follows:

       Apportionment Ratio = (A / (A + B))

       where:

        A   =   the closing price of an Unbundled Grindrod Share x the unbundling ratio,
                i.e. ZAR2.68081 (being ZAR8.73000 X 0.30708)

        B   =   the closing price of a Remgro Share, i.e. ZAR 131.74000

        Thus, the Apportionment Ratio     =           ZAR2.68081
                                               ZAR2.68081 + ZAR131.74000

                                          =    1.99434%

4.3.   Remgro Shareholders are hereby advised that the expenditure incurred and/or Market Value, as
       the case may be, in respect of Remgro Shares must therefore be apportioned in the ratio of
       1.99434% to an Unbundled Grindrod Share and 98.00566% to a Remgro Share.

5.     INCREASE TO TAX COST / BASE COST PER SHARE BASED ON “DISQUALIFIED
       PERSON” RULES

       In relation to paragraph 8.4 of the Terms Announcement, Remgro Shareholders are advised that
       no tax is payable by Remgro in relation to the distribution of the Unbundled Grindrod Shares to
       “disqualified persons” as envisaged in section 46(7)(a) of the Income Tax Act. As a result, there
       will be no increase in the tax cost / base cost for Remgro Shareholders.
6.     CASH PROCEEDS OF FRACTIONAL ENTITLEMENT

6.1.   As outlined in paragraph 4 of the Terms Announcement, in implementing the Remgro Unbundling
       Remgro is required by the Listings Requirements of JSE Limited (“Listings Requirements”) to
       round down the fractional entitlements to Unbundled Grindrod Shares to the nearest whole
       Unbundled Grindrod Share. The fractions of Unbundled Grindrod Shares to which Remgro
       Shareholders remain entitled will not be transferred to them, but will be aggregated and sold on
       Remgro Shareholders’ behalf in the open market as soon as practically possible after the Remgro
       Unbundling.
6.2.   Remgro Shareholders will accordingly receive a monetary amount (i.e. the Cash Proceeds) in
       respect of their fractional entitlements to Unbundled Grindrod Shares. In accordance with the
       Listings Requirements, the Cash Proceeds have now been determined with reference to the
       volume‐weighted average price (“VWAP”) of an Unbundled Grindrod Share on the securities
       exchange operated by JSE Limited on Wednesday, 12 October 2022, reduced by 10%.
6.3.   Taking into account the VWAP of 862.37530 cents, Remgro Shareholders are advised that the
       calculation of the Cash Proceeds due to Remgro Shareholders in respect of any fractional
       entitlements will be based on a price of 776.13777 cents (i.e. 862.37530 cents x 90%) per
       Unbundled Grindrod Share.
6.4.   The Cash Proceeds will not be subject to dividend withholding tax in terms of the Income Tax
       Act. Remgro Shareholders are advised to consult their own professional tax advisors should they
       have any queries regarding the revenue and/or capital gain taxation consequences of the Cash
       Proceeds when paid and the calculation of their costs for taxation purposes.




Stellenbosch
13 October 2022

Financial adviser and Sponsor
Rand Merchant Bank, a division of FirstRand Bank Limited

Legal adviser
ENSafrica