THIS DOCUMENT IS IMPORTANT. IF YOU ARE IN ANY DOUBT ABOUT ITS CONTENTS, YOU SHOULD IMMEDIATELY CONSULT AN AUTHORISED FINANCIAL ADVISOR.

Transcription

1 A company existing under Luxembourg law in the form of a société en commandite par actions (partnership limited by shares) and registered with the Luxembourg Register of Commerce and Companies under number B PROSPECTUS for the offer to subscribe for ordinary shares (the New Shares ) in Reinet Investments S.C.A., a société en commandite par actions (partnership limited by shares) organised under the laws of the Grand Duchy of Luxembourg and having the corporate objects and tax status of a securitisation company under the Luxembourg Securitisation Law of 22 March 2004 (loi du 22 mars 2004 relative à la titrisation) (the Luxembourg Securitisation Law ) (the Company or Reinet Investments ) structured by way of allotment to the shareholders of the Company (the Shareholders ) of nil-paid renounceable warrants (the Warrants ) which entitle the holders thereof ( Warrantholders ) to subscribe for four New Shares for every five Warrants by contributing shares in British American Tobacco plc ( BAT ) ( BAT Shares ) for each New Share to be issued (the Rights Offering ); the admission of the Warrants to the Official List of the Bourse de Luxembourg (the Luxembourg Stock Exchange ) and to trading on the Regulated Market thereof; the admission of the Warrant Receipts to trading on the exchange operated by JSE Limited ( JSE ); the admission of the New Shares issued under the Rights Offering to the Official List of the Luxembourg Stock Exchange and to trading on the Regulated Market thereof; and the admission of the Reinet DRs issued under the Rights Offering to trading on the JSE. THIS DOCUMENT IS IMPORTANT. IF YOU ARE IN ANY DOUBT ABOUT ITS CONTENTS, YOU SHOULD IMMEDIATELY CONSULT AN AUTHORISED FINANCIAL ADVISOR. This document constitutes a Prospectus for the purposes of Directive 2003/71/EC (the Prospectus Directive ) and has been prepared in accordance with the Luxembourg Law of 10 July 2005 on Prospectuses (loi du 10 juillet 2005 relative aux prospectus pour valeurs mobilières), as amended (the Luxembourg Prospectus Law ). This Prospectus has been filed with the Commission de Surveillance du Secteur Financier ( CSSF ), the competent authority in Luxembourg for the purposes of the Prospectus Directive, in accordance with the Luxembourg Prospectus Law and related regulations which implement the Prospectus Directive under Luxembourg law and has been approved by the CSSF in the context of the Rights Offering, the admission of the Warrants to the Official List of the Luxembourg Stock Exchange and to trading on the Regulated Market thereof, and the admission of the New Shares issued under the Rights Offering to the Official List of the Luxembourg Stock Exchange and to trading on the Regulated Market thereof. The ordinary shares of the Company ( Shares ) were admitted to the Official List of the Luxembourg Stock Exchange and admitted to trading on the Regulated Market of the Luxembourg Stock Exchange on 21 October 2008, under the symbol ReinetInvest with International Securities Identifying Number (ISIN) of LU and common code , pursuant to a prospectus approved by the CSSF on 10 October 2008 (the Listing Prospectus ). Certain information contained in the Listing Prospectus has been referred to and shall be incorporated into this Prospectus see Information Incorporated by Reference for further information. The Company accepts responsibility for the information contained in this Prospectus, with the exception of the information relating to the business and financial statements of BAT and the report the Company requested from the independent auditors, PricewaterhouseCoopers S.à r.l., in respect of the Unaudited Pro Forma Consolidated Balance Sheet. To the best of the knowledge of the Company (having taken all reasonable care to ensure that such is the case), the information contained in this Prospectus is in accordance with the facts and does not omit anything likely to affect the import of such information. The information contained in this Prospectus relating to the business and financial statements of BAT has been extracted from the 2007 annual report, the 2008 interim report and the quarterly report to 30 September 2008 of that company. To the best of the knowledge of the Company, that information has been accurately reproduced and, as far as the Company is able to ascertain from information published by BAT, no facts have been omitted which would render the reproduced information inaccurate or misleading. No public market currently exists for the Warrants. Application has been made for the admission of the Warrants to trading on the Regulated Market of the Luxembourg Stock Exchange under the symbol ReinetInvestSR with ISIN LU and common code It is expected that admission of the Warrants will become effective and that unconditional dealings will begin at 9.30 am on 17 November 2008 and cease on 5 December 2008 (the Warrants Trading Period ). All dealings in the Warrants prior to the commencement of unconditional dealings will be of no effect if admission to the Regulated Market of the Luxembourg Stock Exchange does not take place and will be at the sole risk of the parties concerned. No application is to be made for the Warrants to be admitted to listing or dealt with on any other exchange. The Company has arranged for depositary receipts in respect of the Shares to be issued by Richemont Securities S.A. (the Depositary ) in respect of the Shares ( Reinet DRs ). Each Reinet DR entitles the holder to a one-tenth economic and voting participation in the Shares. Reinet DRs are listed on the JSE. In order to facilitate the participation of holders of Reinet DRs in the Rights Offering, the Company will arrange for the issue of nil-paid depositary receipts in respect of the Warrants ( Warrant Receipts ), entitling Reinet DR holders to subscribe for additional Reinet DRs by contributing BAT Shares. Application has been made for the admission of the Warrant Receipts and the new Reinet DRs to be issued under the Rights Offering to trading on the JSE. It is expected that the Warrant Receipts will commence trading on the JSE on 17 November Further information about the Warrant Receipts will be provided to holders of Reinet DRs in the supplementary rights offering information document that accompanies this Prospectus. New Shares issued as a result of the exercise of Warrants are expected to be admitted to the Official List of the Luxembourg Stock Exchange and to trading on the Regulated Market of the Luxembourg Stock Exchange on 17 December The last practicable date for Warrantholders holding Warrants in uncertificated form to instruct their financial intermediary to exercise the Warrants is 10 December The subscription rights attaching to Warrants that remain unexercised at 9.00 am on 12 December 2008 ( Unexercised Subscription Rights and Unexercised Warrants respectively) will be sold at a public auction to be conducted by the officiating bailiff on 15 December 2008 from am until 12 noon at the latest, at the Luxembourg Stock Exchange (the Warrant Auction ). A Warrantholder s share of the proceeds from the Warrant Auction may be less than the amount they may have received if the Warrants had been sold prior to expiry. This Prospectus has been produced solely for use in connection with the Rights Offering; the admission of the Warrants to the Official List of the Luxembourg Stock Exchange and to trading on the Regulated Market thereof; the admission of the Warrant Receipts to trading on the JSE; the admission of the New Shares to the Official List of the Luxembourg Stock Exchange and to trading on the Regulated Market thereof and the admission of the Reinet DRs to be issued under the Rights Offering to trading on the JSE. This Prospectus does not constitute, and may not be used for the purposes of, any offer, solicitation, exchange, sale or resale to anyone in any jurisdiction in which such offer, solicitation, sale, exchange or resale is not authorised, or to any person to whom it is unlawful to make such offer, solicitation, sale, exchange or resale. Furthermore, no reselling action may be initiated or completed without the Company s prior written consent if such action(s) would entail a violation of the applicable rules and regulations and/or would trigger the requirement for the Company to comply with any regulatory regime. The distribution of this Prospectus in certain jurisdictions may be restricted and, accordingly, persons into whose possession this Prospectus comes are required to inform themselves about, and to observe, such restrictions. Prospective investors should inform themselves as to: (a) the legal requirements within their own jurisdictions for the purchase or holding of Shares, New Shares and Warrants; (b) any foreign exchange restrictions which may affect them; and (c) the income and other tax consequences which may apply in their own jurisdictions relevant to the purchase, holding, redeeming or disposal of Shares, New Shares and Warrants.

2 Notice regarding the United States of America This Prospectus is not for distribution, and may not be distributed, in the United States or to U.S. Persons (as that term is defined in Regulation S under the U.S. Securities Act of 1933 (the Securities Act )). Neither the Shares, the New Shares nor the Warrants have been, or will be, registered under the Securities Act or under any state securities laws in the United States. No U.S. Person is permitted to exercise the Warrants and subscribe for New Shares. Each person exercising a Warrant will be required to give a written certification that it is not a U.S. Person and that the Warrant is not being exercised on behalf of a U.S. Person. Unless an exemption from such registration requirements is available, neither the Shares, the New Shares nor the Warrants may be offered or sold within the United States or to, or for the account or benefit of, any national, resident or citizen of the United States. Notice regarding Japan With regard to the solicitation of an offer to acquire the Warrants, registration under Article 4, Paragraph 1 of the Financial Instruments and Exchange Law of Japan (Law No. 25 of 1948, as amended; the FIEL ) has not been and will not be made, on the ground that the Warrants are being offered in accordance with Article 2, Paragraph 3, Item 2b of the FIEL. Accordingly, no solicitation of an offer to acquire the Warrants may be made to 50 or more persons in Japan within any six-month period; provided, however, that Qualified Institutional Investors as defined under Article 2, Paragraph 3, Item 1 of the FIEL and Article 10 of the Cabinet Office Ordinance Concerning Definitions under Article 2 of the FIEL (Ordinance of Cabinet Office No. 14 of 1993, as amended) (the QIIs ) shall not be counted for the purpose of calculating the number of persons solicited, on the condition that all of the requirements as set forth in Article 1 4, Paragraph 1 of the Enforcement Order of the FIEL (Cabinet Order No. 321 of 1965, as amended) are met. The acquirers of the Warrants shall not include persons or entities set forth in Article 63, Paragraph 1, Items 1(a) through 1(c) of the FIEL (the Persons or Entities ). Where the acquirers of the Warrants are QIIs (excluding the Persons or Entities), such QIIs shall agree in writing that no purported transfer of all or any part of the Warrants shall be valid or effective unless such purported transfer is made to another QII (excluding the Persons or Entities). Any transfer of the Warrants by QIIs is prohibited except for the case where the Warrants will be transferred to QIIs (excluding the Persons or Entities). Where the acquirers of the Warrants are investors other than QIIs (excluding the Persons or Entities, such investors shall agree in writing that no purported transfer of all or any part of the Warrants shall be valid or effective unless such purported transfer is made to one individual or one legal entity (excluding the Persons or Entities) at one time. Any transfer of the Warrants by investors other than QIIs is prohibited except for the case where the Warrants will be transferred to one individual or one legal entity (excluding the Persons or Entities) at one time. Notice regarding Australia The Rights Offering is directed only to persons to whom such an offer may be made in Australia without a disclosure document being lodged with the Australian Securities and Investments Commission ( ASIC ). This means the Rights Offering is directed only to investors in relation to whom the disclosure obligations under the Corporations Act 2001 (Cth) do not apply. As no formal disclosure document (such as a prospectus) will be lodged with ASIC, the Rights Offering will only be made to those persons described above. If a person to whom Warrants or New Shares are issued (an Investor ) on-sells the Warrants or New Shares within 12 months from their issue, the Investor will be required to lodge a prospectus with ASIC unless either: (a) that sale is to another person in relation to whom the disclosure obligations under the Corporations Act 2001 (Cth) do not apply; or (b) the sale offer is received outside Australia. Each Investor acknowledges the above and declares that it is a person in relation to whom the disclosure obligations under the Corporations Act 2001 (Cth) do not apply and gives an undertaking not to sell in any circumstances other than those described in paragraphs (a) and (b) above for 12 months after the date of issue. Nothing in this Prospectus takes into account the investment objectives, financial situation and particular needs of any individual Investor. Reinet Investments is not licensed in Australia to provide financial product advice in relation to either the Warrants or the Shares or the New Shares and does not (nor holds itself out to) provide such financial product advice. By accepting this Prospectus you warrant that you have relied on your own independent advice in the making of any financial decision. It is recommended that you read the Prospectus before making a decision to acquire the New Shares. There is no cooling-off period that applies in respect of the acquisition of the New Shares. Notice regarding Switzerland Neither the Company nor Reinet Fund have been approved by the Swiss Federal Banking Commission as foreign collective investment schemes pursuant to Article 120 of the Swiss Federal Collective Investment Schemes Act of 23 June 2006 (the CISA ). Neither the Company nor Reinet Fund is supervised by the Swiss Federal Banking Commission, and Shareholders will consequently not benefit from the protection guaranteed by the CISA. Notice regarding Germany This Prospectus has not been registered with, or approved by, the German Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht) and does not constitute a public offer under the German Securities Prospectus Act (Wertpapierprospektgesetz) or the German Investment Act (Investmentgesetz). Any securities described or directly or indirectly referred to herein are not admitted to and must not be distributed within Germany by way of a public offer, public advertisement or in any similar manner unless explicitly stated otherwise. This Prospectus and any other marketing research and materials relating to or describing such securities as well as information contained therein must not be supplied to the public in Germany or used in connection with any offer for subscription of securities to the public in Germany. There is a risk that the German authorities will qualify the Shares or the shares in Reinet Fund as foreign investment units under the German Investment Tax Act (Investmentsteuergesetz). In such instance German investors may be subject to a disadvantageous taxation under section 6 of the German Investment Tax Act. Each holder and each person who considers becoming a holder of securities described or directly or indirectly referred to herein must assess the individual legal and tax consequences applicable, in particular if such securities are qualified as foreign investment units within the meaning of the German Investment Tax Act. The Prospectus should only be viewed by persons who qualify as an institutional investor within the meaning of section 2(11) sentence 2 no 1 of the German Investment Act (Investmentgesetz). Notice regarding Italy No public offering of securities is being made in the Republic of Italy. This Prospectus has not been prepared in the context of a public offering of securities in the Republic of Italy within the meaning of article 1, paragraph 1, letter (t) of Legislative Decree n. 58 of February 24, Therefore, it has not been submitted to the clearance procedure of the Commissione Nazionale per le Società e la Borsa pursuant to article 94 of Legislative Decree n. 58 of February 24, Under no circumstances should this Prospectus be circulated, or distributed or made available in the Republic of Italy. Notice regarding Spain Neither the Shares, the New Shares, the Warrants nor this Prospectus have been approved by, registered in the administrative registries of, or notified to the Spanish Securities Market Commission (Comisión Nacional del Mercado de Valores) in accordance with the provisions implementing Directive 2003/71/EC. Consequently, neither the Warrants, Shares or New Shares may be offered in Spain except in circumstances which do not constitute a public offer of securities in Spain within the meaning of article 30 bis of the Spanish Securities Market Law of July 28, 1988 (Ley 24/1988, de 28 de julio, del Mercado de Valores), as amended and restated, and supplemental rules enacted thereunder, or otherwise in reliance on an exemption from registration available thereunder. Application has been made to have this Prospectus passported into the United Kingdom and France in accordance with the Prospectus Directive; it will not be passported into any other jurisdiction. AN INVESTMENT IN THE WARRANTS, THE NEW SHARES, OR THE SHARES IS SUBJECT TO CERTAIN RISKS. PROSPECTIVE INVESTORS SHOULD CONSIDER THE RISKS ASSOCIATED WITH SUCH AN INVESTMENT WHEN READING THE INFORMATION CONTAINED IN THIS PROSPECTUS AND BE AWARE OF THE RISK OF LOSING SUCH INVESTMENT IN ITS ENTIRETY BEFORE DECIDING TO INVEST. CERTAIN RISK FACTORS ARE SET OUT OR REFERRED TO IN THE SECTION OF THIS PROSPECTUS ENTITLED RISK FACTORS. HOWEVER, PROSPECTIVE INVESTORS SHOULD READ THE ENTIRE PROSPECTUS BEFORE MAKING ANY INVESTMENT DECISION. Dated 14 November 2008

3 CONTENTS Indicative timetable of key events 2 Information incorporated by reference 3 Summary 4 Risk factors 8 Important information 10 The Rights Offering and Optional Placing 12 Information about Reinet Investments 18 Significant shareholders 23 Material contracts 24 Related party transactions 25 Additional information 26 Taxation 33 Legal matters 35 Independent auditors 36 Documents available for inspection 37 Glossary of defined terms 38 Report on the Unaudited Pro Forma Consolidated Balance Sheet of Reinet Investments S.C.A. included in the Prospectus 43 Directory 45 Page 1

4 INDICATIVE TIMETABLE OF KEY EVENTS Event Time and/or date 1 Publication of this Prospectus 14 November 2008 Last day to trade in Shares on the Luxembourg Stock Exchange to be eligible for Warrants under the Rights Offering 14 November 2008 Allocation of Warrants to Shareholders 17 November 2008 First day of Exercise Period and Warrants Trading Period 17 November 2008 Shares start trading ex-entitlement to Warrants 17 November 2008 Last day for conversion between Warrants and Warrant Receipts 3 December 2008 Last day of Warrants Trading Period 5 December 2008 Last practicable time for an investor holding Warrants in uncertificated form to exercise Warrants pm on 10 December 2008 End of Exercise Period am on 12 December 2008 Auction of Unexercised Subscription Rights on Luxembourg Stock Exchange 4 15 December 2008 New Shares Settlement Date 17 December 2008 New Shares to commence trading on the Luxembourg Stock Exchange 17 December 2008 Last date for Underwriters to exercise option to receive Additional Shares 19 December Except where otherwise stated, all references to times are to Central European Time. Each of the above times and dates is indicative only and may be subject to change. Any material change will be published in the applicable Swiss or Luxembourg press. 2 Sufficient BAT Shares need to be held in the same custody account as that in which Warrants are held for exercise at this point. 3 The last day for settlement institutions and registered Warrantholders to confirm the exercise of Warrants. 4 If BAT Shares have not been delivered in respect of the Unexercised Subscription Rights exercised under the terms of the Warrant Auction by 3.00 pm Central European Time on Tuesday 16 December 2008 such Unexercised Subscription Rights shall pass to the Underwriters. The purchaser of such Unexercised Subscription Rights at the Warrant Auction shall still be liable to pay the price due for having purchased such Unexercised Subscription Rights at the Warrant Auction. 2

5 INFORMATION INCORPORATED BY REFERENCE The Listing Prospectus, which is available for inspection as described below in Documents Available for Inspection, contains information which is relevant to the Rights Offering as set out in the table below ( Incorporated Information ). Any Incorporated Information shall be incorporated as modified or superseded by any statement contained in this Prospectus (whether expressly, by implication or otherwise) and reflecting the fact that the Richemont Reconstruction, the Reduction of Capital, Remgro Distribution and First Capital Increase have each been implemented in the manner set out in the Information Memorandum issued jointly by the Company and CFR on 15 August 2008 and the Listing Prospectus. No other information contained in the Listing Prospectus shall be so incorporated into this Prospectus. The Listing Prospectus is available on the website of the Luxembourg Stock Exchange at Incorporated Information (Page numbers refer to the Listing Prospectus) Destination of Incorporated Information (Page numbers refer to this Prospectus) Risk Factors (pages 8 15) Risk Factors (page 8) Richemont Reconstruction (pages 18 21) Information about Reinet Investments (page 18) The Reduction of Capital and the First Capital Increase Information about Reinet Investments (page 18) (pages 22 23) Business Overview (page 35) Information about Reinet Investments (page 18) Business Reinet Investments, Business Reinet Fund Information about Reinet Investments (pages 36 43) Investment Objective and Policy (page 19) Business BAT (page 44) Dividend Policy (page 34) Information about Reinet Investments BAT (page 20) Information about Reinet Investments Dividend Policy (page 20) Management and Corporate Governance Information about Reinet Investments (pages 45 52) Management and Corporate Governance (page 20) The Investment Advisor and the Investment Advisory Information about Reinet Investments Agreement (pages 53 56) The Investment Advisor and the Investment Advisory Agreement (page 21) Material Contracts (pages 58 59) Material Contracts (page 24) Related Party Transactions (pages 60 61) Related Party Transactions (page 25) Additional Information (pages 62 68) Additional Information (page 26) Taxation (pages 74 76) Taxation (page 33) 3

6 SUMMARY This summary highlights certain matters relating to the Company and the Rights Offering. Any investment decision in relation to the New Shares should be based on a consideration of this Prospectus as a whole, including the Incorporated Information, along with any supplement to the Prospectus and any other documents incorporated by reference herein. This summary does not contain all the information that investors should consider before making investment decisions in relation to the New Shares or Warrants. Investors should pay particular attention to the section of this Prospectus entitled Risk Factors and should read the whole of this Prospectus and not just rely upon this summary. If an investor brings a claim relating to the information contained in this Prospectus before a court, it might, under the national legislation of the relevant EEA State in which the claim is brought, have to bear the costs of translating this Prospectus before the legal proceedings are initiated. Civil liability attaches to those persons responsible for this summary, including any translation of the summary, but only if the summary is misleading, inaccurate or inconsistent when read together with other parts of this Prospectus. BACKGROUND The Company was formerly part of the Richemont group of which Compagnie Financière Richemont S.A. ( CFR ) is the ultimate holding company ( Richemont or the Group ). The Group was reorganised on 20 October 2008 pursuant to the Richemont Reconstruction described in the Listing Prospectus. As a result of the Richemont Reconstruction the Company was separated from the Group and converted into a regulated securitisation vehicle subject to the supervision of the CSSF, which will hold its assets through its whollyowned subsidiary, Reinet Fund S.C.A., F.I.S. ( Reinet Fund ), a Luxembourg-regulated Specialised Investment Fund. On implementation of the Richemont Reconstruction all the shares in the Company held by CFR were cancelled and all participation certificates in issue which were held by the CFR shareholders ( PCs ) were converted into the Shares, the former PC holders becoming Shareholders. In addition, management shares in the company (the Management Shares ) were issued to Reinet Investments Manager S.A. ( Reinet Investments Manager ) to exercise the management powers of the Company. At the close of business on 20 October 2008, the new articles of association of the Company (the Articles ) became effective; the former board of directors of the Company ceased to be in office; the statutory auditor ceased to be in office; the management powers of the Company were vested in Reinet Investments Manager; and the appointment of the Board of Overseers (described below) became effective. Following the Richemont Reconstruction, both the Reduction of Capital and the First Capital Increase described in the Listing Prospectus were implemented. CFR now conducts the former Group s luxury businesses from its headquarters in Switzerland on a stand-alone basis. CFR continues to be listed on the SIX Swiss Exchange and traded on SWX Europe, and the CFR Shares remain part of the Swiss Market Index. CFR also continues to maintain a depositary receipt facility under which the Depositary issues depositary receipts in respect of CFR Shares giving a one-tenth entitlement to CFR Shares ( CFR DRs ). CFR DRs remain listed on the JSE. The Company, through Reinet Fund, holds a portion of the Group s former holding of BAT Shares, as well as assets outside of the luxury goods sector, which include relatively small unlisted investments in technology and related sectors. The Company is headquartered in Luxembourg and the Shares have been admitted to the Official List of the Luxembourg Stock Exchange and to trading on the Regulated Market thereof. THE RIGHTS OFFERING The Rights Offering was authorised by an extraordinary general meeting of the then shareholders of the Company, CFR, and the PC holders on 8 October 2008, along with other resolutions required to implement the Richemont Reconstruction, First Capital Increase and Reduction of Capital. The minutes of this meeting were published in the Memorial Recueil des Sociétés et Associations, being the Luxembourg official gazette on 17 October The Memorial Recueil des Sociétés et Associations is where the Company publishes such documents as required by Luxembourg law. The final terms of the Rights Offering were approved by meetings of the Board of Overseers and the directors of Reinet Investments Manager on 13 November The Rights Offering is structured as an allotment of Warrants enabling the subscription of New Shares against the contribution of BAT Shares to a subsidiary of the Company, Reinet Jersey Holdings Limited ( Reinet Jersey ), which will in turn issue additional shares to the Company. Shareholders will be issued with one Warrant for each Share held. The Warrants will be traded on the Regulated Market of the Luxembourg Stock Exchange. The Depositary will issue to Reinet DR Holders one Warrant Receipt for every 10 Reinet DRs held. The Warrant Receipts will be traded on the JSE and one Warrant Receipt will represent one Warrant. 4

7 The Warrants may be exercised during the period from 17 November 2008 to 9.00 am on 12 December 2008 (the Exercise Period ), although the last practicable time for exercising Warrants held in uncertificated form will be 5.00 pm on 10 December A Warrantholder must exercise five Warrants to subscribe for four New Shares and as a result the total number of Warrants exercised must be a multiple of five. Warrantholders who choose to exercise their Warrants will need to tender BAT Shares as consideration for each New Share issued ( Subscription Exchange Ratio ), and instruct their bank or financial intermediary to deliver the relevant number of BAT Shares to the CREST account of Computershare Investor Services plc on behalf of Reinet Jersey Holdings Limited with CREST Participant ID CCX15 and CREST Member ID <JEREINET>. Failure to make such payment will cause such Warrants to be deemed unexercised. In total Warrants and New Shares will be issued under the Rights Offering and BAT Shares will be contributed to Reinet, such BAT Shares having a value of e based upon the closing BAT share price ( 16.95) and the EUR:GBP Exchange Rate ( ) at the close of business on 13 November The Subscription Exchange Ratio represents a discount to the theoretical share price of the Company exwarrants of approximately 4.5 per cent. on the Luxembourg Stock Exchange and 10.5 per cent. for Reinet DRs on the JSE based on pricing of the relevant securities on 13 November No adjustment to the Subscription Exchange Ratio has been made in respect of any stamp duty, stamp duty reserve tax or other costs associated with the contribution of BAT Shares by Warrantholders or the issue of the New Shares that are incurred by the Company or its subsidiaries, which the Company estimates to be in the order of e3.4m if the assumptions set out on page 17 hold true. Holders of Unexercised Warrants will be entitled to a pro rata cash payment based upon the net proceeds of the Warrant Auction, provided that the amount of any payment is not of such a size as to be impracticable for the relevant financial intermediary to make the payment to the Warrantholder. Underwriting The Rights Offering is underwritten by Compagnie Financière Rupert ( CF Rupert ), the holding company for the majority of the Rupert family interests in the Company, and Rembrandt Trust (Proprietary) Limited ( Rembrandt Trust ), the holding company for Rupert family interests in Remgro Limited ( Remgro ) (together, the Underwriters ) pursuant to an underwriting agreement entered into between the Company and the Underwriters on 13 November 2008 (the Underwriting Agreement ). The Underwriters have undertaken to participate in the Warrant Auction by each bidding at least one Euro in aggregate to acquire a specified proportion of all Unexercised Subscription Rights, the sum of the specified proportions equalling 100 per cent. and to exercise the Unexercised Subscription Rights so acquired to subscribe for New Shares (or Reinet DRs in respect of New Shares) at the price and in accordance with the terms of the Warrants and the Warrant Auction, or procuring one or more persons connected with them or the Rupert family interests ( Connected Persons ) to do so. The Underwriters, and persons related to them, may trade in the Warrants and the Shares throughout the Warrants Trading Period and the Exercise Period to the extent permitted by relevant law. Optional Placing No underwriting fee will be payable, but as compensation for undertaking their underwriting obligations, the Underwriters will have the opportunity to subscribe for New Shares, or to nominate one or more Connected Persons to do so, by contributing additional BAT Shares to Reinet Jersey (the Optional Placing and, together with the Rights Offering, the Second Capital Increase ). Under the Optional Placing the Underwriters and their Connected Persons can subscribe for that number of additional Shares ( Additional Shares ) that may be subscribed for with any remaining BAT Shares that were distributed to them in connection with the Reduction of Capital or the First Capital Increase ( Additional BAT Shares ) by contributing Additional BAT Shares as consideration for each Additional Share issued (the Optional Placing Exchange Ratio ). The Optional Placing Exchange Ratio implies a nil discount to the pro forma net asset value per share based on the Subscription Exchange Ratio and pricing of the relevant securities on 13 November As such the Optional Placing is expected to be value-neutral to all Shareholders. BUSINESS The Company s portfolio of investments is comprised of BAT Shares, approximately e348.2 million in cash and approximately e58.6 million in Other Assets (as defined below). The Company s portfolio will be contributed to Reinet Fund and the Company expects to continue to be the sole or majority holder of Reinet Fund. Investment objectives, policies and restrictions The investment objective of Reinet Fund is to achieve long-term capital growth. Subject to certain investment restrictions, Reinet Fund s assets may be invested from time to time, directly or through selected third-party managers, in equity securities, fixed income securities, convertible securities and related investments as well as money market investments. Reinet Fund may also invest in commercial and residential property, land and other forms of real estate investments. 5

8 Reinet Fund may also use derivative instruments including futures and/or forward contracts on any security, commodity, interest rate, currency, stock or indices or on any precious metals, contracts for differences, including index contracts, swaps and all ancillary transactions to any of the above, including margined and/or collateralised transactions to any of the above and off-exchange contracts. It is not currently expected that Reinet Fund will make systematic use of indebtedness on any significant scale but it may from time to time borrow to finance specific investments. Although there are inherent risks in leveraging, hedging strategies will be utilised to control these risks. The efficiency of such strategies cannot be guaranteed. All borrowings of Reinet Fund will be subject to the margin requirements established by its lenders and will be non-recourse to the shareholders of Reinet Fund. Reinet Fund may have other investment exposure through the use of derivatives, short positions or other strategies. Reinet Fund may lend securities in its portfolio. Reinet Fund s investments may be made through subsidiary entities and, in such circumstances, the same investment objective, policies and guidelines will apply. The manager of Reinet Fund, Reinet Fund Manager S.A. ( Reinet Fund Manager ), will have regard to the advice of the Investment Advisor in reaching its investment decisions. MANAGEMENT AND CORPORATE GOVERNANCE Reinet Investments Manager The Company is managed by Reinet Investments Manager, which is the unlimited shareholder owning all of the Management Shares. Reinet Investments Manager has broad powers to carry out all management and administrative functions in compliance with the corporate objects of the Company. The board of directors of Reinet Investments Manager is responsible for the management of the Company and is required to act in the Company s best interests. Reinet Investments Manager is ultimately controlled by Rupert family interests. Reinet Fund Manager Reinet Fund is managed by Reinet Fund Manager, which is the unlimited shareholder owning all of the management shares in Reinet Fund. Reinet Fund Manager has broad powers to carry out all management and administrative functions in compliance with the corporate objects of Reinet Fund. In particular, Reinet Fund Manager is responsible for determining the investment policies and restrictions of Reinet Fund to meet Reinet Fund s investment objectives and for the conduct of Reinet Fund s management and business affairs. The board of directors of Reinet Fund Manager is responsible for the management of Reinet Fund and is required to act in the best interests of Reinet Fund. Reinet Fund Manager is ultimately controlled by Rupert family interests. Investment Advisor Reinet Fund Manager entered into an Investment Advisory Agreement with Reinet Investment Advisors Limited (the Investment Advisor ) on 9 October 2008 (the Investment Advisory Agreement ) under which the Investment Advisor makes investment proposals to Reinet Fund Manager and implements the investment decisions adopted by Reinet Fund Manager on behalf of Reinet Fund. The Investment Advisor also assists Reinet Fund Manager in managing the assets and day-to-day operations of Reinet Fund. The Investment Advisor is ultimately controlled by Rupert family interests. Expenses and administration fees The expenses of Reinet Investments Manager and Reinet Fund Manager incurred in the ordinary course of business are reimbursed by the Company and Reinet Fund respectively. In addition, the Company pays Reinet Investments Manager an annual fee equal to 10 per cent. of such expenses. The Investment Advisor is entitled to a management fee from Reinet Fund (based on the net asset value of Reinet Fund adjusted for the net indebtedness of Reinet Investments (if any) outside Reinet Fund) which is reduced by the amount of any reimbursements paid to Reinet Fund Manager as described above and a performance fee based on the total shareholder return generated by the Company. Board of Overseers The operations of the Company and Reinet Fund are each subject to review and audit by a board of overseers (collège des commissaires) (the Board of Overseers ) appointed by their respective shareholders. The same individuals presently comprise the Board of Overseers of both the Company and Reinet Fund. Reinet Fund 6

9 Manager will procure that the same people are elected as the Board of Overseers of Reinet Fund as are elected to the Board of Overseers of the Company. Reinet Investments Manager and Reinet Fund Manager must consult the Board of Overseers in respect of matters which exceed their respective powers. The Board of Overseers may also resolve to require Reinet Fund Manager to terminate the Investment Advisory Agreement in certain circumstances. Dividends The Company s ability to pay any dividends depends upon it receiving dividends or other distributions or payments from Reinet Fund (which is under no obligation to pay dividends or make any other distributions to Reinet Investments). There can be no guarantee that Reinet Investments will pay any dividends and it is under no obligation to do so. It is currently envisaged that the first dividend payable to Shareholders will be paid at some time between 1 October 2009 and 31 March 2010 (if the financial position of Reinet Fund allows the payment of a dividend to the Company and if the financial position of the Company allows the payment of a dividend to Shareholders at that time). RISK FACTORS An investment in the Shares, the Warrants and the New Shares involves a number of risks and uncertainties. Those specifically relating to the Rights Offering include: No assurance can be given that a trading market will develop for the Warrants and if a market does not develop, the Warrants may be subject to greater volatility than the Shares. If Shareholders do not exercise their Warrants their percentage ownership of the Shares will be diluted. The market price of the Shares may fluctuate and may decline below the price implied by the Subscription Exchange Ratio. If the Rights Offering is discontinued or there is a substantial decline in the market price of the Shares, the Warrants may become worthless. No assurance can be given that the liquidity of the Shares following the Second Capital Increase will be greater than or equal to the level prior to the commencement of the Second Capital Increase. 7

10 RISK FACTORS An investment in the Company will involve substantial risks. Prospective investors should carefully consider the risks set out in the Risk Factors section of the Listing Prospectus as supplemented by those specific risks relating to the Rights Offering set out below, before deciding whether to subscribe for New Shares and otherwise how to deal with the Warrants. Additional risks and uncertainties about which the Company is not currently aware, or that the Company currently believes are immaterial, may also adversely impact the business, financial condition, results of operations of the Company as well as the value of any investment in the Company. Neither the fact that the risk factors set out in the Listing Prospectus are not repeated here, nor the order in which the risks are described in the Risk Factors section of the Listing Prospectus or below, reflect the likelihood of their occurrence or the magnitude or significance of the individual risks. If any of these risks were actually to materialise, the business, financial condition and results of operations of the Company, as well as the value of an investment in the Company, could be affected in a material and adverse manner. The Company disclaims any responsibility to advise Shareholders of the risks and investment considerations associated with the Shares, New Shares or Warrants as they may come into existence following the date of this Prospectus. The market price of the Shares may fluctuate and may decline below the price implied by the Subscription Exchange Ratio The market price of the Shares at the time of the Rights Offering may not be indicative of the market price for the Shares after the Rights Offering has been completed. The market price of the Shares may experience significant volatility and fluctuate widely for the reasons given in Risk Factors Risks Relating to the Shares in the Listing Prospectus, depending upon many factors beyond the Company s control, including market expectation of the Company s performance and investor perception of the success and impact of the Rights Offering as described in this Prospectus. As a result of these or other factors, the Shares may trade at prices significantly below their market price at the commencement of the Rights Offering. No assurance can be given that the discount to net asset value NAV reflected in the Share price will not widen during the Rights Offering such that the market price of the Shares will be lower than the subscription price implied by the Subscription Exchange Ratio, which is calculated by multiplying the Subscription Exchange Ratio by the BAT share price converted into Euro. Should that occur during the Warrants Trading Period the value of the Warrants may decline to zero and if it should occur after Shareholders exercise their Warrants, which exercise cannot be revoked or modified, Shareholders will suffer an immediate unrealised loss as a result. Moreover, no assurance can be given that following the exercise of Warrants, Shareholders will be able to sell their Shares at a price equal to or greater than the Subscription Price. No assurance can be given that a trading market will develop for the Warrants and, if a market does develop, the Warrants may be subject to greater volatility than the Shares No assurance can be given that an active trading market in Warrants will develop during the Warrants Trading Period. Additionally, because the market price of the Warrants depends on the market price of the Shares, any volatility in the price of the Shares (as described above) will magnify the volatility of the price of the Warrants. If Shareholders do not exercise their Warrants, their percentage ownership of the Company s Shares will be diluted The Rights Offering is designed to enable the Company to increase its investment assets in a manner that gives the opportunity to Shareholders to subscribe for the New Shares pro-rata to their shareholding, subject to applicable securities laws. The Underwriters have agreed (subject to certain conditions) to acquire and exercise, as part of the Warrant Auction, such number of Warrants remaining unexercised at the end of the Exercise Period. The Underwriters may also subscribe for Additional Shares in the context of the Optional Placing. To the extent that Shareholders do not exercise their Warrants, their proportionate ownership and voting interest in the Company will be reduced. Even if Shareholders elect to sell their Warrants, or if Shareholders decide to hold their Warrants until the end of the Exercise Period and are entitled to receive any Warrant Auction Proceeds (as defined below), the amount they receive, if any, may not be sufficient to compensate them fully for the dilution of their percentage ownership of the Company that may be caused as a result of the Second Capital Increase. 8

11 If the Rights Offering is discontinued or there is a substantial decline in the market price of the Shares, the Warrants may become worthless If the Rights Offering does not proceed, the Warrants will become worthless. Accordingly, Shareholders who still hold their Warrants will suffer a loss, as will investors who have acquired Warrants in the secondary market, as trades relating to Warrants will not be unwound in the event that the Rights Offering is terminated. In addition, a significant decline in the market price of the Shares may have a material adverse effect on the value of the Warrants. No assurance can be given that the liquidity of the Shares following the Second Capital Increase will be greater than or equal to the level of liquidity prior to the commencement of the Second Capital Increase There can be no assurance that the liquidity in the market for Shares following the implementation of the Second Capital Increase will be maintained at the same or greater level as experienced prior to the commencement of the Second Capital Increase. If market activity in the Shares declines following the Second Capital Increase investors may have difficulty disposing of their Shares, especially in large blocks. Prospective investors should therefore consider whether investment in the Company is suitable for them in light of the risk factors outlined above and in the Risk Factors section of the Listing Prospectus, their personal circumstances and the financial resources available to them. 9

12 IMPORTANT INFORMATION ABOUT THIS PROSPECTUS This Prospectus has been produced in connection with the Rights Offering; the admission of the Warrants to the Official List of the Luxembourg Stock Exchange and to trading on the Regulated Market thereof; the admission of the Warrant Receipts to trading on the JSE; the admission of the New Shares to the Official List of the Luxembourg Stock Exchange and to trading on the Regulated Market thereof; and the admission of the Reinet DRs to be issued under the Rights Offering to trading on the JSE. In making any investment decision regarding the Shares, prospective investors must rely on their own examination of the Company, including the merits and risks involved in an investment in the Company. This Prospectus constitutes a prospectus for the purposes of Article 3 of the Prospectus Directive and has been prepared in accordance with Article 5 of the Prospectus Directive, the Luxembourg Prospectus Law and the rules promulgated thereunder. This Prospectus has been approved and filed with the CSSF, the competent authority in Luxembourg for the purposes of the Prospectus Directive in accordance with the Luxembourg Prospectus Law and related regulations which implement the Prospectus Directive under Luxembourg law. Prospective investors should rely only on the information contained in this Prospectus, including Incorporated Information. The Company has not authorised any other person to provide prospective investors with any information or to make any representations in connection with the Rights Offering. If anyone provides prospective investors with any information or makes any representations, such information or representations should not be relied upon. Prospective investors should assume that the information appearing in this Prospectus (including information in the Listing Prospectus that is incorporated by reference) is accurate only as of the date on the inside of the front cover of this Prospectus, regardless of the time of delivery of this Prospectus or of any future offer or sale of the Shares. The business, financial condition, results of operations and prospects of the Company could have changed since that date. The Company expressly disclaims any duty to update this Prospectus, except as required by applicable law. Any significant new factor, material mistake or inaccuracy relating to the information included in this Prospectus which is capable of affecting the assessment of the securities and which arises or is noted between the approval of this Prospectus and the beginning of the trading of the New Shares on the Regulated Market of the Luxembourg Stock Exchange shall be mentioned in a supplement to this Prospectus, in accordance with Article 13 of the Luxembourg Prospectus Law. The Company makes no representation to prospective investors as to the legality of an investment in the Shares, the Warrants or the New Shares and prospective investors should not construe anything in this Prospectus as legal, business or tax advice. Prospective investors should consult their own advisors as to the legal, tax, business, financial and related aspects of an investment in the Warrants or the Shares. FORWARD-LOOKING STATEMENTS This Prospectus includes statements that are, or may be deemed to be, forward-looking statements. These forward-looking statements can be identified by the use of forward-looking terminology, including the terms believes, estimates, anticipates, intends, considers, expects, seeks, target, strategy, objective, aim, continue, may, will or should or, in each case, their negative or other variations or comparable terminology. These forward-looking statements relate to matters that are not historical facts. They appear in a number of places throughout this Prospectus and include statements regarding the intentions, beliefs or current expectations of the Company, Reinet Fund, Reinet Investments Manager, Reinet Fund Manager and the Investment Advisor concerning, among other things, the investment objective and investment policies, financing strategies, investment performance, results of operations, financial condition, liquidity, prospects and dividend payments and policy of the Company and the markets in which it, directly or indirectly, will invest and the resources available to it from its and Reinet Fund s related entities (including, without limitation, the Investment Advisor). By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. Forward-looking statements are not guarantees of future performance. The actual investment performance of the Company, its results of operations, financial condition, liquidity, dividend payments and the development of its financing strategies, and the operation of the markets in which it is directly or indirectly invested and the actual resources available to it, may differ materially from the impression created by the forward-looking statements contained in this Prospectus. In addition, even if the investment performance, results of operations, financial condition, liquidity and dividend payments of the Company, the development of its financing strategies and the operation of the markets in which it is directly or indirectly invested are consistent with the forward-looking statements contained in this Prospectus, those results or 10