1.   Introduction

Shareholders are referred to the cautionary announcement published on 31 July 2002 and are advised that the board of directors of the Company (“the Board”)   has resolved unanimously to propose that the Company make a specific pro rata offer to all its shareholders to purchase 75% of all their respective shares in the Company (“the Repurchase Offer”). The Repurchase Offer will be funded  primary out of the Net Proceeds referred to in paragraph 3.5 below.     
2.   Rationale
The shares in the Company have been trading on the JSE Securities Exchange South Africa (“the JSE”) at a discount to the underlying value of the Company`s assets. The Board is of the view that the Repurchase Offer will give shareholders an opportunity to unlock such value, should they wish to do so.

3.   Suspensive conditions 
The Repurchase Offer is subject to the fulfillment, by not later than 31 March  2003, of inter alia, the following suspensive conditions:

3.1   the approval of the JSE;
3.2   the requisite resolutions being passed in general meeting by  shareholders;
3.3   the registration of the relevant special resolution(s) by the Registrar of Companies;
3.4   the Securities Regulation Panel (“SRP”) granting to the dominant controlling shareholder of the Company, namely SACTWU Investments Group (Proprietary) Limited (“SACTWU”) an exemption from any obligation that it may   have to make a mandatory offer that may be triggered in terms of the Securities Regulation Code on Takeovers and Mergers in consequence of the implementation of the Repurchase Offer;  and
3.5   the Company disposes of its entire interest of 5% in Vodacom Group   (Proprietary) Limited (“the Vodacom Interest”) and receives a net amount of not less than R1.5 billion (“the Net Proceeds”) from such disposal (“the Proposed   Disposal”).

The SRP has advised that it will grant SACTWU the exemption referred to in paragraph 3.4 above, subject to independent shareholders` approval.

4.   The Vodacom Interest 
The Board has entered into negotiations with Venfin Limited regarding the Proposed Disposal of the Vodacom Interest. If such negotiations are concluded it is likely that the Company will receive Net Proceeds of R1.5 billion.

5.   The purchase consideration
The purchase consideration payable by the Company for each HCI share purchased  by it shall be an amount calculated in accordance with the following formula:   R3.04 – [ ( R1.75 billion – A) divided by 370 million ] + (B divided by 370  million)
A = the Net Proceeds;
B = interest on A calculated at 70% of the call rate applicable to Nedcor Bank Limited`s call rate for overnight deposits reckoned from the date of receipt by the Company of the Net Proceeds to the date of payment of the purchase consideration.
The amount of 370 million referred to in the above formula is fixed and was     based on the current number of HCI shares in issue.
Accordingly if the Net Proceeds are R1.75 billion, the consideration per HCI share shall be 304 cents and if the Net Proceeds are R1.5 billion, the  consideration per HCI share shall be 236.4 cents. Such consideration shall be increased by an appropriate amount as calculated in the last part of the above  formula.

It is anticipated that the purchase consideration will be payable to shareholders by no later than 10 April 2003.

6.   Irrevocable undertakings
The Company has received written irrevocable undertakings from shareholders who currently collectively hold in excess of: 
*    70% of all the issued shares in the Company, to vote in favour of such resolutions and grant such approvals that may be required to give effect to the Repurchase Offer;  and 
*    45% of all the issued shares in the Company, to accept the Repurchase Offer in respect of such shares. 

7.   Last day to register, further announcement and documentation
A further announcement will be made in due course setting out, inter alia the last day to register, the terms, financial effects, the salient dates and the   date of the circular, which circular will contain full details of the Repurchase Offer and the Proposed Disposal.

8.   Further cautionary announcement
Shareholders are advised to continue to exercise caution in dealing in their HCI shares until a further announcement is made.

29 August 2002