| Wed 31 Oct 2007, 8:05 | | JCD / RNG - JCI Limited / RandGold & Exploration C |
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JCD RNG KRHT
JCD RNG
JCD / RNG - JCI Limited / RandGold & Exploration Company - Merger update
JCI LIMITED
(Incorporated in the Republic of South Africa)
Registration number 1894/00854/06
Share code: JCD ISIN: ZAE0000039681 (Suspended)
("JCI")
RANDGOLD & EXPLORATION COMPANY LIMITED
(Incorporated in the Republic of South Africa)
(Registration Number 1992/005642/06)
Share code: RNG & ISIN: ZAE000008819 (Suspended)
ADR Ticker symbol: RNG
Nasdaq trading symbol: RANGY (Delisted)
("R&E")
JOINT ANNOUNCEMENT BY R&E AND JCI (COLLECTIVELY "THE COMPANIES" or "BOTH
COMPANIES")UPDATE TO R&E AND JCI SHAREHOLDERS ON THE MERGER PROPOSAL OF THE
COMPANIES AND FURTHER RENEWAL OF CAUTIONARY ANNOUNCEMENTS
On 23 April 2007 the directors of R&E and JCI proposed a merger of the
companies ("the merger proposal") to be effected by way of a scheme of
arrangement ("the scheme") in terms of Section 311 of the Companies Act,
1973, as amended, ("Companies Act").
If acceptable to the shareholders of R&E and JCI, and subject to various
regulatory approvals, including sanction by the High Court of South Africa,
JCI shareholders will be required to exchange their shares in JCI for shares
in R&E, thereby effectively merging the two companies. The proposed exchange
ratio, which has been recommended by the boards of directors of both
companies, is 1 R&E share for every 95 JCI shares in issue, excluding those
held by R&E ("the exchange ratio").
The concept of a merger was also supported by the mediators as described in
their interim recommendation published on 28 February and 5 March 2007.
As reported on 29 June 2007, the companies applied for relaxation of certain
disclosure requirements of the Securities Regulation Panel ("the SRP") and
JSE Limited.
Shareholders are hereby advised that the companies have submitted a draft
scheme circular incorporating documentation relied upon by each company to
support its respective claim including additional information to the SRP in
support of their application referred to above. As soon as possible following
a ruling from the SRP, the companies will finalise their draft circulars and
commence the formal regulatory approval process with the SRP and JSE.
Following the requisite regulatory approvals, the circulars, incorporating
notices of general meetings of both companies to approve the merger
proposals, will be posted to shareholders
Shareholders will be kept updated on further developments in this regard.
Renewal of cautionary announcements to R&E and JCI shareholders
Until the publication of further information as set out above, shareholders
in both companies are advised to continue to exercise caution in trading
their shares over-the-counter until the merger proposal documentation is
finalised.
FORWARD-LOOKING STATEMENT DISCLAIMER FOR R&E AND JCI
Certain statements in this circular, as well as oral statements that may be
made by the officers, directors or employees of each of R&E or JCI acting on
its behalf relating to such information, contain "forward-looking statements"
within the meaning of the U.S. Private Securities Litigation Reform Act of
1995, specifically Section 27A of the U.S. Securities Act of 1933 and Section
21E of the U.S. Securities Exchange Act of 1934. All statements, other than
statements of historical facts, are "forward-looking statements". These
include, without limitation, those statements concerning completion of the
relinquishment by R&E and JCI and certain of their subsidiaries of rights
contiguous to the South Deep gold mine to GFO; the value of the net assets of
R&E and JCI; the pro forma effects of the relinquishment of the contiguous
rights on the financial information and NAV statement of R&E; the ability of
R&E and JCI to successfully consummate a merger that is approved by the
shareholders and is acceptable to the necessary governmental authorities, the
fraud and misappropriation that are alleged to have occurred and the time
periods affected thereby; the ability of R&E and JCI to recover any
misappropriated assets and investments; the outcome of any proceedings on
behalf of, or against R&E or JCI; the ability of each of R&E and JCI to
complete its forensic investigation and prepare audited financial statements;
the time period for completing the forensic investigation and audited
financial statements; the amount of any claims R&E is or is not able to
recover against others, including JCI, and the success of its mediation with
JCI; the likelihood and economic parameters of any merger arrangement between
JCI and R&E; and the ultimate impact on the previously released financial
statements and results, assets and investments, including with respect to
Randgold Resources Limited, business, operations, economic performance,
financial condition, outlook and trading markets of R&E and JCI. Although R&E
and JCI believe that the expectations reflected in such forward-looking
statements are reasonable, no assurance can be given that such expectations
will prove to be correct, particularly in light of the extent of the alleged
frauds and misappropriations uncovered to date. Actual results could differ
materially from those implied by or set out in the forward-looking
statements.
Among other factors, these include the inherent difficulties and
uncertainties in ascertaining the values of the net assets of R&E and JCI,
particularly in light of the absence of any independent valuations, the
existence of any unknown liabilities, the willingness of any governmental
authority to sanction any merger in light of the absence of independent
valuations or otherwise; the extent, magnitude and scope of any fraud and
misappropriation that may be ultimately determined to have occurred and the
time periods and facts related thereto following the completion of the
forensic investigation and any other investigations that may be commenced and
the ultimate outcome of such forensic investigation; the ability of R&E to
successfully assert any claims it may have against other parties for fraud or
misappropriation of R&E assets or otherwise and the solvency of any such
parties, including JCI; the determinations of the mediators and acceptance of
any such determinations by the shareholders of R&E and JCI; the ability of
R&E to defend successfully any counterclaims or proceedings against it; the
ability of each of R&E and JCI and the forensic investigators to obtain the
necessary information with respect to the transactions, assets, investments,
subsidiaries and associated entities of R&E and JCI to complete the forensic
investigation and prepare audited financial statements; the willingness and
ability of the forensic investigators and auditors to issue any final
opinions with respect thereto; the ability of R&E to implement improved
systems and to correct its late reporting; the JSE Limited`s willingness to
lift its suspension of the trading of R&E`s securities on that exchange;
changes in economic and market conditions; fluctuations in commodity prices
and exchange rates; the success of any business and operating initiatives,
including any mining rights; changes in the regulatory environment and other
government actions; business and operational risk management; other matters
not yet known to R&E or JCI or not currently considered material by R&E or
JCI; and the risks identified in Item 3 of R&E`s most recent annual report on
Form 20-F filed with the SEC and its other filings and submissions with the
SEC.
All forward-looking statements attributable to R&E, or persons acting on its
behalf, are qualified in their entirety by these cautionary statements. R&E
expressly disclaims any obligation to release publicly any update or
revisions to any forward-looking statements to reflect any changes in
expectations, or any change in events or circumstances on which those
statements are based, unless otherwise required by law.
Johannesburg
31 October 2007
Sponsor to R&E and JCI
Sasfin Capital
(A division of Sasfin Bank Limited)
Date: 31/10/2007 08:05:28 Produced by the JSE SENS Department.
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employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature,
howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
