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SouthAfricanBrewerie (SAB)

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Thursday 30 May, 2002

SouthAfricanBrewerie

SABMiller Transaction-Replace

South African Breweries PLC
30 May 2002



The issuer advises that the following replaces the SABMiller Transaction
announcement released today at 07:01 under RNS number 6362W.


In the third paragraph of the Introduction and background section the name
'Hawk' was used.

This should have read 'Miller'.



All further details remain unchanged.  The full amended text appears below.



PROPOSED TRANSACTION BETWEEN SAB AND PHILIP MORRIS REGARDING MILLER



London and Johannesburg, 30 May 2002. South African Breweries plc ('SAB') has
announced today that it has entered into an agreement with Philip Morris
Companies Inc. ('Philip Morris') under which SAB will acquire 100 per cent. of
Miller Brewing Company ('Miller') (the 'Transaction'). In consideration, SAB
will issue to Philip Morris 430 million shares. The pre-market speculation
implied enterprise value of Miller is US$4,993 million, including net debt of
US$2,000 million. It is proposed that the combined entity will be called
SABMiller plc ('SABMiller').



SABMiller will:

-          be a leading player in the US market, the brewing industry's largest
profit pool;

-          have a balanced geographic spread of earnings from both high growth
developing markets and cash generative developed markets;

-          enjoy an international portfolio of strong brands; and

-          become the world's second largest brewer, with pro forma 2001 lager
volumes in excess of 120 million hectolitres.



In addition, benefits arising from the transaction will include:

-          strong cash flow generation showing pro forma adjusted EBITDA for the
12 months to 31 March 2002 of US$1,512 million;

-          an improved credit profile with a significantly lower cost of
capital;

-          the ability to continue to participate in the ongoing consolidation
of the global beer market; and

-          the benefits of having Philip Morris as a supportive long-term
shareholder.



The transaction will be earnings enhancing in year one pre-goodwill amortisation
and before synergies, and is expected to deliver annual cost synergies of US$50
million by the end of year three.



Commenting on the proposed transaction, Graham Mackay, Chief Executive of SAB,
said:



'This transaction, by which Miller will be merged into the SAB businesses,
represents a new chapter in our development, taking SABMiller to the number two
position globally, and positioning us to be a major participant in the ongoing
consolidation of the global beer industry. The transaction will provide access
for SAB to a significant position in the US market, which enjoys the brewing
industry's largest profit pool. Furthermore, it will enhance SAB's international
brand portfolio.'



In addition, Louis Camilleri, Chief Executive Officer of Philip Morris, said:



'We are delighted with today's announcement, which is strategically compelling
and is in the best interests of our shareholders. SABMiller will immediately
become the world's second-largest brewer, with arguably the best geographical
footprint among all global brewers. The Enlarged Group will have the ambition,
as well as the financial and managerial capability, to become the world's
leading brewer.'



John D. Bowlin, President and Chief Executive Officer of Miller, said:

 'Everyone wins through this dynamic combination, including Miller's employees,
customers and distributors.  We are combining two great brewers with distinct
yet complementary assets and talents with the promise to become greater than the
sum of the parts. Miller is a great American brewer that will now become part of
a focused, global brewing enterprise with significant growth opportunities
around the world.'



SABMiller will be well positioned within the global brewing industry. From the
outset, SABMiller will be the world's second largest brewer with leading market
positions in Europe, North America, Central America, China and Africa. This
diverse exposure to both developed, cash generative markets as well as to fast
growing developing markets provides exciting growth prospects for the Enlarged
Group.



In addition, SABMiller will benefit from the combination of global scale, a
strong management team, a diverse and balanced earnings base, a broad portfolio
of leading brands and a supportive, long-term shareholder. SABMiller will use
these advantages to position itself at the forefront of the consolidating
brewing industry.



The consideration will be satisfied by the issue to Philip Morris of 430 million
SAB shares. The shares issued to Philip Morris comprise two classes of equity
capital; Ordinary Shares and unlisted low voting participating shares ('
Participating Shares'). These combined will equate to an economic interest of
36.03 per cent. (excluding the shares owned by Safari Limited). Philip Morris'
total voting rights have been capped at 24.99 per cent. of the votes exercisable
at a general meeting.



Assuming the same value for both the Ordinary Shares and Participating Shares,
the closing middle-market price of 490 pence per Ordinary Share as at 14 March
2002 (the last date prior to market speculation that SAB was in discussions with
Philip Morris regarding Miller), a £/US$ exchange rate of 1.4204, and net debt
of not more than US$2,000 million at Completion, Miller has an implied
enterprise value of US$4,993 million.  Based on the closing middle-market price
of 576 pence per Ordinary Share as at 29 May 2002 (the date prior to the
announcement of the Transaction) and on an £/US$ exchange rate of 1.4623, Miller
has an implied enterprise value of US$5,622 million.



Philip Morris will have an important investment in the Enlarged Group, and will
be a supportive long-term shareholder in SABMiller. Accordingly, Philip Morris
has agreed to be subject to a standstill agreement until December 2004 and a
lock-up until June 2005.  Following this lock-up period, Philip Morris has
agreed to enter into orderly marketing arrangements concerning any disposal of
its shareholding.



Graham Mackay and Malcolm Wyman will be Chief Executive and Chief Financial
Officer of SABMiller respectively, with John Bowlin, currently President and
Chief Executive Officer of Miller, to be responsible for SABMiller's business in
the US and Central America.  It is intended that the Board of SABMiller will
consist of two executive Directors and eleven non-executive Directors. At
Completion, Philip Morris is entitled to nominate three of the non-executive
Directors.



SABMiller will maintain its existing primary listing on the London Stock
Exchange, with its continued inclusion in the FTSE 100 Index, and will likewise
maintain its listing on the JSE Securities Exchange South Africa, where it is
included in the JSE 40.



In order to maintain the future financial flexibility of the Enlarged Group, the
Board of SAB is seeking the approval of Shareholders at the Extraordinary
General Meeting for the disapplication of pre-emptive rights on an equity
raising, depending on market conditions, for cash up to a maximum of 170 million
Ordinary Shares, which would represent approximately 14 per cent. of the
enlarged equity share capital. Philip Morris has agreed not to participate in
this potential equity raising. This resolution will be valid until the
conclusion of the 2003 annual general meeting.   In the event of any such equity
raising, qualifying shareholders, being shareholders on the register at a date
yet to be fixed, who duly evidence their holdings will receive a greater
allocation of shares, on a basis to be determined, than they would otherwise
have received.



The Transaction is conditional, inter alia, upon the approval of Shareholders
and certain regulatory clearances.  The approval of Shareholders will be sought
at an Extraordinary General Meeting, the notice of which will be set out in a
circular to Shareholders. The Extraordinary General Meeting is expected to be
convened on 1 July 2002.



JPMorgan is acting as financial adviser to SAB and Cazenove and JPMorgan are
acting as joint corporate brokers. Dresdner Kleinwort Wasserstein and Lehman
Brothers Inc. are acting as joint financial advisers to Philip Morris.



This summary should be read in conjunction with the full text of the following
announcement.



There will be a presentation to analysts at 9.30 a.m. today (30 May 2002) in the
Ayres Room, 8th Floor, Deutsche Bank, 85 London Wall, EC2M 7AD and at 12 noon
today for the media at the same location.



Should analysts be unable to attend the analysts' presentation in person, there
will be a dial in facility available.  The Investor Relations department of SAB
will distribute details of this facility.



The analysts' presentation will have a replay facility available from noon today
until close of business on 6 June 2002, which may be accessed as follows:




From the UK  Dial in: 020 8288 4459                        Access code: 617172
From the US  Dial in: +44 20 8288 4459                     Access code: 617172





For further information, please contact:


South African Breweries plc

Nick Chaloner        Director of Communications             Tel:+44 20 7659 0119
                                                            Mob:+44 7880 502 755

Anna Miller Salzman  Head of Investor Relations             Tel:+44 20 7659 0106

Ciaran Baker         Head of Corporate Communications       Tel:+44 20 7659 0120
                                                            Mob:+44 7979 954 493

Fergus Wylie          Cubitt Consulting Limited             Tel:+44 20 7367 5103

This announcement, a copy of the slide presentation and video interviews with 
management are available on the SAB website at www.sabplc.com and at 
www.cantos.com


Pictures for the media are available from www.newscast.co.uk





Financial Adviser and Corporate Broker                     Corporate Broker


JPMorgan                                                   Cazenove

Julian Oakley                                              David Mayhew
Managing Director                                          Chairman
Tel: +44 20 7325 6287                                      Tel: +44 20 7588 2828

Ian Hannam                                                 Roger Lambert
Chairman, ECDM Europe                                      Managing Director
Tel: +44 20 7325 1168                                      Tel: +44 20 7457 3347





This announcement has been issued by SAB and is the sole responsibility of SAB.



JPMorgan is acting for SAB in connection with the proposed transaction and no
one else and will not be responsible to any one other than SAB for providing the
protections afforded to clients of JPMorgan nor for providing any advice in
relation to the transaction.



Dresdner Kleinwort Wasserstein and Lehman Brothers Inc. are acting for Philip
Morris in connection with the proposed transaction and no one else and will not
be responsible to any one other than Philip Morris for providing the protections
afforded to clients of Dresdner Kleinwort Wasserstein and Lehman Brothers Inc.
nor for providing any advice in relation to the transaction.



This announcement is for information only and does not constitute an offer or an
invitation to acquire or dispose of any securities or investment advice or an
inducement to enter into investment activity.  This announcement does not
constitute an offer to sell or issue or the solicitation of an offer to buy or
acquire SAB securities in any jurisdiction.



The distribution of this announcement may be restricted by law.  Persons into
whose possession this announcement comes are required by SAB to inform
themselves about and to observe any such restrictions.



This announcement includes 'forward-looking statements'.  These forward-looking
statements are made pursuant to the 'Safe Harbor' provisions of the United
States Private Securities Litigation Reform Act of 1995.  All statements other
than statements of historical facts included in this announcement, including,
without limitation, those regarding SAB's financial position, business strategy,
plans and objectives of management for future operations (including development
plans and objectives relating to SAB's products and services) are
forward-looking statements.  Such forward-looking statements involve known and
unknown risks, uncertainties and other important factors that could cause the
actual results, performance or achievements of SAB to be materially different
from future results, performance or achievements expressed or implied by such
forward-looking statements.  Such forward-looking statements are based on
numerous assumptions regarding SAB's present and future business strategies and
the environment in which SAB will operate in the future.  These forward-looking
statements speak only as at the date of this announcement.  SAB expressly
disclaims any obligation or undertaking to disseminate any updates or revisions
to any forward-looking statements contained herein to reflect any change in the
SAB's expectations with regard thereto or any change in events, conditions or
circumstances on which any such statement is based.





PROPOSED TRANSACTION BETWEEN SAB AND PHILIP MORRIS REGARDING MILLER



Introduction and background



South African Breweries plc ('SAB') and Philip Morris Companies Inc. ('Philip
Morris') announce today that they have entered into an agreement under which
Miller Brewing Company ('Miller') will be merged into SAB (the 'Transaction'),
creating the world's second largest brewer with a balanced geographic spread of
earnings between fast growing developing markets and more developed, cash
generative markets. In consideration, SAB will issue to Philip Morris 430
million shares, consisting of approximately 235 million Ordinary Shares and
approximately 195 million low voting participating shares ('Participating Shares
') (together the 'Consideration Shares'). Philip Morris will have an important
investment in the Enlarged Group, and will be a supportive long-term
shareholder.



Following the Transaction and prior to the possible equity placing (discussed
below), Philip Morris' total economic interest in the Enlarged Group will be
36.03 per cent. (excluding the shares owned by Safari Limited) and its total
voting interest will be 24.99 per cent. of the votes exercisable at a general
meeting.  Following Completion, it is proposed that SAB will be renamed
SABMiller plc ('SABMiller').



Assuming the same value for both the Ordinary Shares and Participating Shares,
the closing middle-market price of 490 pence per Ordinary Share as at 14 March
2002 (the last date prior to the market speculation that SAB was in discussions
with Philip Morris regarding Miller), a £/US$ exchange rate of 1.4204, and net
debt of not more than US$2,000 million, Miller has an implied enterprise value
of US$4,993 million. Based on the closing middle-market price of 576 pence per
Ordinary Share as at 29 May 2002 (being the date prior to the announcement of
the transaction) and on an £/US$ exchange rate of 1.4623, Miller has an implied
enterprise value of US$5,622 million.



The Transaction is conditional, inter alia, upon the approval of SAB
shareholders and certain regulatory clearances. The Extraordinary General
Meeting is expected to be on 1 July 2002.



Rationale for the Transaction



The board of SAB (the 'Board') believes that the Transaction with Miller is a
significant step in the implementation of SAB's strategy to participate actively
in the ongoing consolidation of the global brewing industry and enhance its
position as a leading global brewer. The Board believes that SABMiller's
balanced and diversified exposure to both fast growing developing markets as
well as to developed cash generative markets provides attractive growth
prospects for the Enlarged Group.



SABMiller will be one of the world's most diverse international brewers with
leading market positions in Europe, North America, Central America, China and
Africa. The combined business will have the global scale, geographical balance,
quality brand portfolio, extensive distribution platform and financial strength
to enhance its competitiveness and drive shareholder value.



The US market is the brewing industry's largest and most profitable market and,
unlike many other developed markets, it has delivered recent growth in
consumption, in particular within the premium light, imports and flavoured malt
beverages ('FMB', also known as RTDs in Europe) categories.



Miller is the second largest brewer in the US with an attractive portfolio of
brands including Miller Lite, Miller Genuine Draft, Miller High Life,
Milwaukee's Best and Foster's. In addition, Miller has an exciting new portfolio
of leading premium FMB brands. As an integrated part of the SABMiller group, the
Miller management team will be well placed to continue to take advantage of
growth opportunities in this market.



SAB believes that the recent strategy introduced by Miller's management team
will continue to benefit Miller's ongoing performance. Initiatives include:



•         focusing marketing investment behind the core brands;

•         consolidation of its distribution network and improving distributor
relationships and retail execution;

•         increasing production efficiency; and

•         the introduction of new products - such as FMBs.



The Board believes that the combination of Miller's strongly cash generative US
business with SAB's leading international businesses will provide significant
ancillary benefits in terms of cross-selling of core brands such as Pilsner
Urquell, Miller Lite and Miller Genuine Draft, margin enhancement through
implementation of 'best practice', and ongoing benefits of economies of scale.



The transaction creates:



•                     Access for SAB to the US - the brewing industry's most
important market



The US market is the world's largest and most profitable beer market. The EBITDA
generated in the US in 2000 was more than double that of the world's second most
profitable market - Japan. This merger of Miller into SAB will provide access
for SAB's Shareholders to this profit-pool and ensure additional benefits from
future opportunities in the US. Miller's solid number two position is an
attractive platform for SAB in this large and important beer market.



•                     The world's second largest brewer



SABMiller will have significant scale and international reach as the second
largest brewer in the world by volume, with pro forma March 2002 lager volumes
of more than 120 million hectolitres.  In addition, it would have had pro forma
volumes of 34 million hectolitres of CSDs and other non-lager related beverages
for the same period.  This scale will allow it to continue to take advantage of
opportunities to accelerate its growth in developing markets, as well as giving
it the ability to participate in additional developed markets as appropriate.



•                     A well balanced geographical spread of earnings



SABMiller will have an attractive balance of fast growing developing markets and
more developed cash generative markets.



Based on 2002 pro forma figures for SABMiller (pre exceptional items), the EBITA
generated by the Enlarged Group would have split geographically as follows:


Region                                                     % EBITA
North America                                              35
South Africa                                               33
Europe                                                     16
Africa and Asia                                            14
Central America                                            2



This analysis includes only four months of EBITA from SAB's Central America
operations and excludes SAB's recent acquisitions in China and India.



•                     A strong portfolio of leading brands with cross-selling
potential



The Enlarged Group will benefit from a complementary portfolio of leading
international, regional and local brands, which are well positioned throughout
their key market segments.  SABMiller's prominent market positions will provide
a strong base for further leveraging of this portfolio. Particular opportunities
include the cross-selling of Miller's key brands in several of SAB's businesses
as well as making Pilsner Urquell available throughout Miller's extensive US
distribution network.



•                     An attractive platform for further growth



SABMiller's global network will provide an attractive platform for growth, both
organically as well as through further synergistic acquisitions or partnerships
of preference.



Occupying a top three position in more than 30 countries (including the Castel
interest), SABMiller is attractively positioned as one of the major players in
the rapidly consolidating brewing industry. The Enlarged Group's key markets
will provide strong and stable cash flows, which can be used to fund additional
strategic and earnings enhancing acquisitions as appropriate.



•                     Financial strength and stability



For the 12 months to 31 March 2002, SABMiller would have generated pro forma
revenues and EBITDA of approximately US$9,266 million and US$1,512 million
respectively.



The Directors of SAB believe that the Enlarged Group's exposure to the strongly
cash generative US market will substantially improve SABMiller's credit profile
in the international debt capital markets, as well as lowering the Group's cost
of capital.



In addition, as the Group reports in US dollars, the significant incremental US
dollar earnings of SABMiller will reduce the Group's relative exposure to
currency fluctuations.



•                     Earnings accretive in year one - excluding synergies



The Transaction is expected to be earnings enhancing, before acquisition
goodwill and synergies, in the current financial year.



Furthermore, the Transaction is expected to deliver annual cost synergies of
US$50 million by the end of year three resulting mainly from procurement
benefits and the application of 'best practice' across the business. In
addition, revenue benefits are expected from the previously mentioned
cross-selling of brands.



•                     Experienced and high quality management team



The Transaction will combine SAB's well regarded management expertise, sound
operational track record and proven ability to integrate acquisitions with
Miller's experienced management team led by John Bowlin, who will bring to the
Group an in-depth understanding of the US beer market and its opportunities.



•                     Long-term relationship with a supportive shareholder



Philip Morris will have an important investment in SABMiller, will be a
supportive long-term   shareholder and  has also stated that it is supportive of
the SABMiller strategy.  Accordingly, Philip Morris has agreed to a standstill
period until 31 December 2004 and a lock-up period (in which it will not be able
to sell its shares, other than in specific circumstances) until 30 June 2005.
After 30 June 2005, any potential disposal is subject to orderly marketing
arrangements. Philip Morris also has the right, subject to its ownership levels,
to participate and/or underwrite certain equity capital raisings, excluding the
non pre-emptive capital raising for which approval is sought. Philip Morris has
the further right, subject to the level of its economic interest in SABMiller,
to appoint up to three non-executive representatives to the SABMiller board.



The Board of SAB believes that the support from Philip Morris - the world's
largest consumer product company - provides an important competitive advantage
to SABMiller.



SABMiller strategy



In line with the existing SAB business philosophy and strategy, SABMiller will
continue to focus on:



•         achieving profitable growth as a leading player in the global beer
market;

•         driving volumes, productivity and margins in major markets;

•         optimising and expanding established positions in developing markets;

•         developing positions in the international premium beer market; and

•         seeking opportunities to enhance its position as a global brewer with
exposure to both developing and developed markets.



Information on Miller



Miller has been the second largest brewer in the US since 1977. In 2001, Miller
had volumes of 50 million hectolitres and a market share of 20 per cent. In
addition, Miller brewed 10 million hectolitres in 2001 under contract brewing
arrangements.  The Miller brand portfolio has leading positions in all the key
market segments. The major brands are Miller Lite (premium light), Miller
Genuine Draft (premium regular), Miller High Life (near premium), Milwaukee's
Best (budget), Foster's (imports) and a new portfolio of premium FMB brands.



Miller operates nine breweries across the US and has a strong national
distribution network and is one of the lowest cost brewers in the US.



In the year ended 31 December 2001, Miller generated a turnover of US$4,800
million and an adjusted EBITDA of US$546 million (before exceptional items of
US$34 million and amortisation of US$9 million and including allocated Philip
Morris central costs of US$88 million). If Miller had been part of the Enlarged
Group, it is estimated that its central costs would have been US$40 million and
adjusted EBITDA would have been US$594 million and adjusted EBITA of US$463
million.

Agreements

Summary of the principal terms of the Transaction Agreement



SAB and Philip Morris have signed a Transaction Agreement under which SAB will
issue approximately 235 million Ordinary Shares of US$0.10 each and
approximately 195 million Participating Shares of US$0.10 each giving Philip
Morris an economic interest of 36.03 per cent. in SAB (excluding shares held by
Safari Limited). However, Philip Morris' voting interest will be restricted to
24.99 per cent. of the votes capable of being cast at a general meeting.  At
Completion, Miller will have net debt of not more than US$2,000 million.



Summary of the principal terms of the Relationship Agreement



The Relationship Agreement sets out the mechanics by which SAB shall maintain
its independence from Philip Morris.



Under the terms of the Relationship Agreement, Philip Morris has been granted a
number of rights in respect of its shares in SAB, the principal items being:



•         Philip Morris shall be entitled to nominate up to three non-executive
Directors, subject to the level of its economic interest in SAB;



•         for so long as Philip Morris' economic interest is 10 per cent. or
more of the Enlarged Group, Philip Morris shall have the right to receive
certain financial information; and



•         Philip Morris also has the right to participate in and/or underwrite
certain future equity capital raisings, excluding the non pre-emptive capital
raising for which approval is sought.



Under the terms of the Relationship Agreement, Philip Morris has agreed to a
number of restrictions in respect of its shares in SAB, the principal items
being:



•         Philip Morris shall not, save in certain specified circumstances,
prior to 31 December 2004, acquire any equity securities in SAB as a result of
which Philip Morris' voting rights in SAB would exceed 24.99 per cent;



•         Philip Morris shall not, save in certain specified circumstances,
prior to 30 June 2005, dispose of or take any charge over any equity securities
in SAB; and



•         Philip Morris may dispose of Ordinary Shares after 30 June 2005, but
any such disposal must be in accordance with orderly marketing arrangements.



The Panel on Takeovers and Mergers (the 'Panel') has indicated to SAB and Philip
Morris that the standstill and lock up provisions in the Relationship Agreement,
together with the proposed changes to the Articles of Association, may give rise
to a deemed concert party between Philip Morris and persons connected with
Philip Morris on the one hand and SAB and the Board of SAB and persons connected
with them on the other hand.  Accordingly, the Relationship Agreement provides
that if circumstances arise where any interest in shares in SAB is acquired by
SAB or persons connected with SAB, such that (when taken together with the
shares in SAB in which SAB and persons connected with SAB are then interested
aggregated with the shares in SAB then held by Philip Morris and persons
connected with Philip Morris) the aggregate Voting Interest of all those persons
exceeds 29.99%, the standstill and lock up restrictions described above will
cease to apply. SAB and Philip Morris have confirmed to the Panel that they will
advise the Panel if they become aware that such circumstances are likely to
arise or have arisen.



The Relationship Agreement has no fixed term, but ceases to apply if Philip
Morris' total voting interest in SAB falls below 10 per cent.



Summary of the principal terms of the Transitional Services Agreement



Under the terms of the Transitional Services Agreement, a subsidiary of Philip
Morris will provide Miller with certain services for a transitional period of up
to 30 months from Completion.  These services will be provided on a comparable
basis as provided historically to Miller.  The cost of providing each service
will be on an actual cost plus a service fee and expenses basis.



Board of Directors



The composition of the Board of Directors of SABMiller will change following the
completion of this transaction.  There will be two Executive Directors - namely
Graham Mackay (Chief Executive) and Malcolm Wyman (CFO).



In addition the SABMiller board will initially consist of 11 non-executive
Directors, of which Philip Morris can nominate three.



Dividends



The Consideration Shares will not be entitled to participate in the final
dividend of US18.5 cents declared by SAB in respect of its financial year ended
31 March 2002. The Consideration Shares shall entitle Philip Morris to receive a
pro rata dividend (based on the date of Completion) for the six-month period
ending 30 September 2002.



SABMiller generally will seek to maintain its current dividend policy (adjusted
earnings per Ordinary Share dividend cover of 2.2 to 2.5 times).



Dividends will continue to be paid to SABMiller shareholders on the United
Kingdom section of the register in pounds sterling and US dollars and to those
SABMiller shareholders on the South African section of the register in Rand at,
in each case, the exchange rates prevailing at such time.



Financial reporting



SABMiller will continue to publish financial statements denominated in both US
dollars and Rand and prepared in accordance with UK GAAP.  The financial
year-end will continue to be 31 March.



Announcement of results



SAB also today announced its preliminary results for the financial year ended 31
March 2002.



Employees and SAB employee share schemes



SAB and Miller currently employ approximately 38,000 people in aggregate
worldwide. The existing employment terms and conditions, including pension
rights of employees, will be appropriately safeguarded.  Both SAB and Miller
will continue to inform and, where appropriate, consult with relevant employee
organisations regarding the Transaction in accordance with applicable legal and
contractual requirements.



The Transaction will have no effect on the existing entitlements under the SAB
employee share schemes.



Amendment of the Articles of Association



As part of the arrangements for the Transaction, SAB shareholders will be asked
to approve amendments to the Articles of Association to create the new class of
Participating Shares and to give Philip Morris the right to appoint up to three
non-executive directors to the SAB board and to convert the Ordinary Shares
registered in the name of Safari Limited into non-voting convertible shares.



The principal features of the Participating Shares are:



•         save as set out below, the Participating Shares shall rank pari passu
with the Ordinary Shares;

•         the Participating Shares carry a vote at general meetings of SAB on
the basis of one-tenth of a vote for every Participating Share on all
resolutions other than certain specified resolutions where they carry one vote
for each Participating Share; and

•         the Participating Shares are convertible into Ordinary Shares in
certain specified circumstances on a one for one basis.

Potential equity raising



In order to maintain the future financial flexibility of the Enlarged Group, the
SAB board is seeking the approval of SAB shareholders at the Extraordinary
General Meeting for the disapplication of pre-emptive rights on an equity
raising, depending on market conditions, for cash up to a maximum of 170 million
Ordinary Shares, which would represent approximately 14 per cent. of the
enlarged equity share capital. Philip Morris has agreed not to participate in
this potential equity raising. This resolution will be valid until the
conclusion of the 2003 annual general meeting. In the event of any such equity
raising, qualifying shareholders, being shareholders on the register at a date
yet to be fixed, who duly evidence their holdings will receive a greater
allocation of shares, on a basis to be determined, than they would otherwise
have received.



Listings, dealing and settlement



Following Completion, SAB will retain its existing stock market listings,
including its listing of Ordinary Shares on the Official List of the UK Listing
Authority and on the JSE Securities Exchange South Africa.



Application has been made to the UK Listing Authority for approximately 235
million new Ordinary Shares to be admitted to the Official List and to the
London Stock Exchange for these SAB Shares to be admitted to trading on the
London Stock Exchange's market for listed securities.  Application has also been
made for approximately a further 195 million Ordinary Shares to be admitted to
the Official List, in order that Ordinary Shares arising on conversion of the
Participating Shares can be listed.



Application has also been made for the New SAB Shares to be listed with a
secondary listing on the JSE Securities Exchange South Africa.





                      This information is provided by RNS
            The company news service from the London Stock Exchange