SAPPI LTD (SAP) 6-K

ANNEXURE 3
PRO FORMA BALANCE SHEET AND INCOME STATEMENT OF THE SAPPI GROUP
Sappi has entered into agreements (which are subject to the fulfilment of the conditions precedent) to acquire the Acquired Business for a consideration of
approximately EUR750 million (US$1,184 million), less the third party net debt and adjusted by the variation from the target net working capital of EUR235
million (US$371 million), as determined in accordance with the master sales agreement on the date of completion. As of 30 June 2008 the third party debt
was EUR88 million (US$139 million) and the variation to the target net working capital was EUR13 million (US$21 million). In addition, total acquisition
expenses directly attributable to the transaction are estimated to be EUR19 million (US$30 million).
In accordance with the agreements, the aggregated purchase price, if the transaction occurred on 30 June 2008, is calculated as follows:
EUR’m US$’m
Gross purchase price 750 1,184
Adjusted for:
External third party debt (88) (139)
Acquisition costs 19 30
Working capital variation 13 21
694 1,096
The purchase price will be funded as follows:
Cash (obtained from the proceeds from the rights issue) 432 682
Newly issued Sappi shares 50 79
Interest bearing vendor loan due to M-real 212 335
694 1,096
In connection with the Transaction, Sappi will also enter into long term supply agreements with M-real for energy, wood and pulp and transitional marketing
agreements for the outputs of the Husum PM8 machine and the Äänekoski PM2 machine. Management believes these contracts are executed at a market rate
and therefore have not been reflected as a pro forma adjustment.
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