| Mon 10 Sep 2007, 15:30 | | MML - Metmar - Acquisition of an additional intere |
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MML
MML
MML - Metmar - Acquisition of an additional interest in Manganese and Stainless
Steel Alloy Producer
Metmar Limited
Incorporated in the Republic of South Africa
(Registration number 1998/007269/06)
Share code: MML & ISIN code: ZAE000078747
("Metmar" or "the Company")
ACQUISITION OF AN ADDITIONAL INTEREST IN MANGANESE AND STAINLESS STEEL ALLOY
PRODUCER
1. Introduction
Metmar shareholders are referred to the Cautionary Announcement made on 20
August 2007 and the Acquisition Announcement made on 26 April 2007 in terms
of which Metmar acquired an effective interest of 9.86% in Mogale Alloys
(Pty) Limited ("Mogale Alloys"). Metmar is pleased to announce that on 30
August 2007, an agreement was signed regarding the acquisition by the
Company of an additional 5.2% interest in PGR 17 Investments (Pty) Limited
("PGR")("the acquisition"), bringing its total interest in PGR up to 21.0%.
PGR is an investment holding company and is the controlling shareholder in
Mogale Alloys. This further acquisition gives Metmar an effective interest
of 11.81% in Mogale Alloys. PGR also has other interests in chrome ore
production.
In terms of the Listings Requirements of the JSE Limited ("JSE"), the
acquisition is classified as a category three transaction. This
announcement is therefore for information purposes only and no action is
required by Metmar shareholders.
2. Details of the acquisition
2.1 The vendors
The vendors of the 5.2% shareholding in PGR are the Ferguson Family Trust,
Isak Carel Pienaar and Johan Frederick Oosthuizen ("the vendors").
2.2 The purchase consideration
The purchase consideration in respect of the additional shareholding
amounts to R14 810 127 and has been settled in cash.
2.3 The effective date
The effective date of the acquisition is 1 September 2007.
3. Rationale for the acquisition
Mogale Alloys is an alloy producer situated in Krugersdorp which produces
silico manganese from manganese ore and a stainless steel alloy from
stainless steel dust. Metmar has a sales/marketing relationship with Mogale
Alloys. The acquisition is therefore in line with Metmar`s stated aim of
acquiring strategic minority shareholdings in commodity producers in order
to secure long term marketing income.
4. Put Option
Metmar has entered into a Put Option Agreement to acquire a further 10.6%
interest in PGR from another shareholder on or before 25 February 2008 for
a purchase consideration of R30 189 873 to be settled in cash or Metmar
shares. If the event that the Put Option is not exercised by the
shareholder on or before 25 February 2008, the option will lapse and
neither party shall have a claim against the other.
5. Pro forma financial effects of the cumulative acquisitions
The pro forma financial effects of the cumulative acquisitions, as
presented below, are the responsibility of the board of Metmar and are
presented for illustrative purposes only to provide information on how the
cumulative acquisitions might have impacted on the reported financial
information of the Company if it had been implemented in the year ended 28
February 2007. Because of their nature, the pro forma financial effects
may not give a fair indication of the Company`s financial position at 28
February 2007 or its future earnings.
Before the After the % change
acquisitions1 acquisitions 3
Headline earnings per 25.3 28.0 10.7
ordinary share for the
year ended 28 February
2007 (cents)
Basic earnings per 28 0 30.6 9.3
ordinary share for the
year ended 28 February
2007 (cents)
Net asset value ("NAV") 56.3 72.4 28.6
per ordinary share at 28
February 2007 (cents)
_______________________ ________________ _______________ ________________
Net tangible asset value 52.1 68.4 31.3
("NTAV") per ordinary
share at 28 February
2007 (cents)
Weighted average number 175 362 058 185 362 058 5.7
of ordinary shares in
issue for the period
Number of ordinary 175 362 058 185 362 058 5.7
shares in issue at the
end of the period
Notes:
1. The figures in this column are extracted from the audited annual financial
results of the Company for the year ended 28 February 2007 as released on
SENS on 21 May 2007 and posted to shareholders on 31 May 2007.
2. For the purposes of the cumulative acquisitions, the audited annual
financial statements of Mogale Alloys for the year ended 31 March 2007 and
the unaudited management accounts for the year ended 31 August 2007 of PGR
have been used. All inter-company transactions between Mogale Alloys and
PGR have been eliminated. As part of the first acquisition of 15.8% in PGR
for a purchase consideration of R36 million, effective 1 March 2007, the
Company placed 10 million Metmar ordinary shares with institutions at an
issue price of R3.55 per share. The purchase consideration for the
additional 5.2% was settled in cash.
3. The figures in this column are based on the figures set out in the previous
column after the implementation of the cumulative acquisitions. For
purposes of the headline and basic earnings per ordinary share it was
assumed that the cumulative acquisitions of a 21% interest in PGR had been
in effect for the year ended 28 February 2007 and, for purposes of net
asset value and net tangible asset value per ordinary share, that it had
been implemented on 28 February 2007.
10 September 2007
Bryanston
Sponsor
BDO QuestCo (Pty) Ltd
Date: 10/09/2007 15:30:01 Produced by the JSE SENS Department.
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