reverse takeover by honeycombe

You little ripper, probably not the best time to announce it but this is great news!

August 2007
ASX ANNOUNCEMENT
Australian Stock Exchange Limited
Companies Announcement Office
Electronic Lodgement System
ACQUISITION OF HONEYCOMBES PROPERTY GROUP
The Board of Eumundi Group Limited (“Eumundi”) is pleased to announce an acquisition of a
controlling interest in the Honeycombes Property Group to create a dominant Queensland
operator in the property investment and development market.
The acquisition will proceed under an Acquisition Implementation Deed pursuant to which
Eumundi will make an offer to each of the existing shareholders of Honeycombes Property Group
Pty Ltd (Honeycombes) and Honeycombes Ownership Pty Ltd (Honeycombes Ownership).
The offer by Eumundi will comprise the issue of 287 fully paid ordinary shares in Eumundi for
every share held in Honeycombes and will be made by personal offer to the shareholders of
Honeycombes and Honeycombes Ownership.
The acquisition is subject to a number of conditions precedent, including the approval of Eumundi,
Honeycombes and Honeycombes Ownership shareholders to the transaction.
Upon successful completion of the acquisition, Eumundi will own 97% of the shares of both
Honeycombes and Honeycombes Ownership, with the balance being retained by entities
associated with Peter Honeycombe, who will be appointed Managing Director of Eumundi. The
remaining 3% will be subject to a Put and Call Option (Put and Call Option Deed) which will
entitle Eumundi to acquire those shares in certain circumstances.
The acquisition will capitalise on the synergies that the Eumundi Board believe exist between
Honeycombes Property Group and Eumundi. Honeycombes Property Group has an established
residential development business which will complement and enhance the commercial property
portfolio that Eumundi has built over recent years. Eumundi is principally a commercial property
holding company with assets that have development capability. The acquisition will provide
Eumundi with the development capability to capitalise on the development opportunities that it
currently holds in its commercial property assets as well as a prominent position within the
residential property development market.
Upon completion of the acquisition, Eumundi will be owned 61.5% by existing Eumundi
Shareholders and 38.5% by Honeycombes Shareholders.
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The acquisition will combine the significant management and board expertise of the two groups.
The Chairman of Eumundi following completion of the acquisition will initially be Eumundi's
current Chairman, Mr Joe Ganim, and the Managing Director and Chief Executive Officer will be
Honeycombe's current Managing Director, Mr Peter Honeycombe.
In addition to Mr. Ganim and Mr. Honeycombe, following completion of the acquisition, the board
of directors of Eumundi will also comprise of one further Eumundi nominated director, Mr Vern
Wills and four further Honeycombes nominated directors. It is intended at the Annual General
Meeting of Eumundi that Mr Ganim will step down as Chairman and Ms Annabelle Chaplain will
assume that role. Mr Ganim will remain on the Board of Eumundi as a non-executive director.
Eumundi, Honeycombes and Honeycombes Ownership have signed an Acquisition
Implementation Deed which provides for these companies to facilitate the implementation of the
acquisition, restrains each company from soliciting further proposals and provides for a
compensating amount of up to $280,000 to be payable by either party to the other in certain
circumstances including if the Acquisition Implementation Deed is terminated as a result of
default.
The Deed also sets out certain conditions precedent to the acquisition, namely:
• there being no material adverse change in Eumundi, Honeycombes or Honeycombes
Ownership;
• there being no prescribed occurrence in respect of Eumundi, Honeycombes or
Honeycombes Ownership;
• all regulatory approvals that may be necessary for the acquisition are granted or obtained;
• there are no prohibitions in respect of the acquisition;
• no party having an ongoing right to subscribe for securities in Honeycombes or
Honeycombes Ownership after the acquisition;
• an independent expert's report being obtained that concludes the acquisition is in the best
interests of Eumundi Shareholders;
• Eumundi Shareholders approving the acquisition;
• The Eumundi shares to be issued to the Honeycombes Shareholders being granted
quotation on ASX, subject to any restriction in accordance with the Listing Rules (it is also
noted that voluntary restrictions will be placed on certain Honeycombes Shareholders);
• Eumundi being satisfied that the Eumundi shares can be issued to the Honeycombes
Shareholders pursuant to the Corporations Act;
• The parties undertaking due diligence investigations; and
• The Put and Call Option Deed being executed.
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Eumundi intends to convene a meeting of its shareholders to be held in November 2007 in order
for the Eumundi Shareholders to consider and vote on the terms of the acquisition, with the
appropriate date to be notified to and appropriate meeting materials to be despatched to Eumundi
Shareholders in due course.
Yours sincerely
Joseph Ganim
Chairman
Eumundi Group Limited