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Here's an excellent analysis of AdvTech growth prospects from Moneyweb's Investor magazine. They have always been more conservative than Curro. But now they have a R3 billion investment plan, especially in their schools division.

They remain a takeover target both locally and internationally. Remember the Curro offer was at a 42% premium.

All successful businesses are funded by debt to enable them to grow. I wouldn't read too much into the ratio, they are doing a restructuring of their debt.
You missed out on 40% YTD appreciation in the share price. This one along with Curro are buys, certainly for the long term for reasons known to all of us.

Capital structure and funding

Net Group gearing as at 30 June 2015 reflects a debt to equity ratio of 132%. While this is well within the Group’s covenants with its bankers, ABSA

(member of Barclays), it is evident that the Group’s accessible funds to maintain its accelerating investment plan will become constrained. The Group

holds or is securing 20 sites for expansion and development. The Board has approved further new investments as part of the previously-announced

R3 billion rolling capital expansions programme, and management has identified and is developing other new projects totalling almost R1 billion.


The Board is therefore considering the optimal capital structure for the Group and is formulating a financing strategy that it believes will allow it to

sustain this accelerating growth strategy in the most efficient manner. In particular, the Board believes it is important to have certainty of access to

various funding sources in order to be best positioned to execute in competitive situations.


As part of this process ADvTECH is looking to put in place long-term debt facilities which will be used to refinance existing bank borrowings. This will

allow the Group to raise further debt facilities as and when needed and thus enhance the scope and flexibility of ADvTECH’s planning and the execution

of its growth and acquisition strategy.

POSTING OF RIGHTS OFFER CIRCULAR

ADvTECH shareholders are referred to the finalisation announcement released on the Stock Exchange News
Service (“SENS”) on 5 November 2015 relating to a rights offer to raise up to R850 million.

ADvTECH shareholders are advised that the circular in respect of the rights offer will be posted to certificated
shareholders on Tuesday, 17 November 2015 and to dematerialised shareholders who have elected to receive
such documents on Tuesday, 24 November 2015. The circular will also be available on the Company’s
website: www.advtech.co.za.

The letters of allocation were listed and commenced trading today, Monday, 16 November 2015, and will
continue trading until Friday, 27 November 2015.


Johannesburg
16 November 2015

Based on this...

In terms of the rights offer, 75,555,556 new ADvTECH ordinary shares (“rights offer shares”) will be
         offered to ADvTECH shareholders recorded in ADvTECH’s share register at the close of business on
         Friday, 20 November 2015 (“record date”), at a subscription price of R11.25 cents per rights offer
         share, in the ratio of 16.59818 rights offer shares for every 100 ADvTECH ordinary shares held.

         The subscription price per rights offer share represents a 10% discount to the 30 day volume
         weighted average price of ADvTECH ordinary shares listed on the JSE Limited (“JSE”) as at the close
         of business on Wednesday, 21 October 2015, being the date on which the rights offer was priced.

I get an ex rights share price of about R12.62. Deduct the rights offer price of R11.25 and you get R1.37 for the value of the nil paid letters.

I would just follow your rights as things stand now.

Record date for the rights offer                                                         Friday, 20 November

Rights offer opens at 09:00                                                              Monday, 23 November