Quarterly Update

QUARTERLY UPDATE 

In accordance with the JSE Limited Listings Requirements and the Company’s Pre-Listing Statement dated 18 July 2016, Ethos Capital has set out below an update on the progress of its various strategic initiatives and an updated Net Asset Value (“NAV”) for the quarter ended 30 September 2016. 

Primary Investments

The Ethos Mid-Market Fund is on track for the first close of the fund in October 2016.  Ethos Capital will be one of the first close investors with a commitment of R550 million with a total commitment on final close of R900 million.  Progress has been made on the acquisition of certain BEE assets from Ethos Fund VI and if Advisory Board approval is forthcoming, completion is likely to occur soon after the date of the first close of the fund.  The Ethos Mezzanine Partners Fund raising is likely to be launched in November 2016.  The Ethos Capital commitment to this fund is R320 million. 

Secondary Investments

The Ethos Capital Board has approved the Secondary Investments strategy.  The Company has made several offers to existing investors in Ethos Fund VI.  Discussions continue, however there can be no certainty that a transaction will be concluded.  The Board continues to explore various options to acquire a stake in Ethos Fund VI. 

Temporary Investments

Ashburton Fund Managers (“Ashburton”) has been appointed as the manager of the Temporary Investments.  During August and September, Ashburton invested the IPO proceeds net of expenses and excluding some proceeds which was transferred to US Dollars to facilitate the Secondary Investments strategy. The Temporary Investments have been invested in a portfolio of low risk, liquid South African government bonds and bank NCDs.  The current yield on the portfolio is approximately 7.7%. 

Net Asset Value

The NAV as at 30 September 2016 was R1.77 billion, reflecting the IPO proceeds net of listing expenses and other operating expenditure.  This equates to a NAV per ordinary share (adjusted)* of R9.83. 

* adjusted to exclude the encumbered shares issued to Ethos Private Equity.    

The financial information on which this announcement is based has not been reviewed and reported on by the Company’s external auditors.