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1 Fa 275 Kent Avenue, Ferndale, Randburg 2125 / Private Bag X10095, Randburg 2125 Tel: (011) 561 - 9300 / Fax: (011) 787 - 3046/2849 steinhoff INTERNATIONAL HOLDINGS 14 December 2017 Dear Members Headlines in the business press over the past couple of days have been dominated by both the resignation of steinhoff CEO, Markus Jooste, and his replacement by the Chairman, Christo Wiese, with immediate effect. As a result, the share price of steinhoff International Holdings ( steinhoff ) has fallen substantially, down 83% for the period from 30 November 2017 to the time of preparing this correspondence. The table below shows the actual percentage exposure to steinhoff in the Funds at 31 October 2017 : Fund % exposure to steinhoff 12 month Local Equity contribution to the Fund % Approximate performance impact based on share price movement to date Motor Industry Provident Fund Auto Workers Provident Fund For Retirement Funds such as the Motor Industry Provident Fund and which are regarded as long-term investments, it is crucial that the principle of diversification is applied.
2 The Fund applies this principle in its investment strategy and has a diversified asset allocation in place. This means that the Fund invests in a range of different asset classes such as equity (shares), fixed interest (inflation linked bonds, bonds and cash), property and offshore investments. This strategy allows for the risk to be spread across different investments, so that the Fund is not exposed to only one type of asset class. Furthermore, within asset classes, the risk is spread across different managers. In turn, these managers also have diversity in their underlying investments. The Fund also complies with Regulation 28 restrictions, which limit the exposures to individual underlying investments.
3 This in turn further limits the risk. The Fund continues to monitor the steinhoff situation and will provide members with updates when further details are made public. Kind regards KEITH WEBB PRINCIPAL OFFICER MOTOR INDUSTRY FUND ADMINISTRATION
