| Thu 1 Nov 2007, 16:07 | | SAM - Samroc - Revised terms of proposed capital r |
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SAM
SAM
SAM - Samroc - Revised terms of proposed capital restructure and
recapitalisation change of control mandatory offer to Samroc minority
shareholders
SA MINERAL RESOURCES CORPORATION LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1993/000460/06)
Share code: SAM
ISIN: ZAE000012019
("Samroc" or "the company")
REVISED TERMS OF PROPOSED CAPITAL RESTRUCTURE AND RECAPITALISATION CHANGE OF
CONTROL MANDATORY OFFER TO SAMROC MINORITY SHAREHOLDERS
Further to the announcement regarding a capital restructure and
recapitalisation of Samroc released on SENS on 8 June 2007, Samroc shareholders
are advised that the terms of the capital restructure and recapitalisation
referred to therein have been revised.
Encha Group Limited ("Encha") is a company wholly owned by black persons and
controlled by the Moseneke family. Encha has formed a special purpose
investment vehicle with Investec Private Bank ("Investec") to facilitate a
combined shareholding which will have a controlling shareholding in Samroc
("Encha Capital"). Following the implementation of the recapitalisation and the
acquisition, Encha Capital will become the controlling shareholder of Samroc
("change of control") and will be required to make an offer ("mandatory offer")
to Samroc minority shareholders.
Encha Capital has provided evidence to the satisfaction of the Securities
Regulation Panel that it has the facilities available to meet its obligations
in terms of the mandatory offer.
The purpose of this announcement is to provide information on the revised terms
of the capital restructure, the recapitalisation, the change of control and the
terms of the mandatory offer.
Revised terms of the capital restructure and recapitalisation
It was previously announced that Samroc would raise R10 million by means of the
issue (post a 1 - for - 100 consolidation of Samroc shares) of 10 million
shares for cash at 100 cents per share. It has now been decided that:
- instead of consolidating the shares 1 - for - 100, they will be converted
to no par value shares and consolidated 1 - for - 10 ("new ordinary
shares"); and
- a total of 235 million new ordinary shares will be issued at 10 cents per
new ordinary share to raise a total of R23.5 million. Part of the proceeds
of the additional subscription will be applied to retire the shareholder`s
loan owing to GVM Metals Limited ("GVM"), which stands at approximately
R9.8 million.
The following parties have irrevocably undertaken to subscribe for the new
ordinary shares:
Number of shares Subscription amount
Encha Capital 147 859 889 R14 785 989
BH Christie (note 1) 27 140 111 R2 714 011
SA Export Development 10 000 000 R1 000 000
Fund
Riccla (note 2) 30 000 000 R3 000 000
Encha Group Limited 20 000 000 R2 000 000
TOTAL 235 000 000 R23 500 000
Notes:
1. In terms of Section 10 of the JSE Limited ("JSE") Listings Requirements,
Mr Christie, a director of Samroc, is a related party and accordingly a
fairness opinion from an independent professional expert is required in
terms of paragraph 5.51(f) of the JSE Listings Requirements. Mazars Moores
Rowland, Chartered Accountants (SA) has been appointed as independent
professional expert. The expert`s opinion will be contained in the
circular regarding the transactions to be sent to shareholders in due
course.
2. Riccla 1758 (Pty) Limited ("Riccla"), is an investment vehicle for a
consortium of investors, represented by Michiel Wilhelm Gerhardus Voges, a
South African national and resident. .Riccla`s sole shareholder is Banjara
Holdings Limited, a British Virgin Islands incorporated entity, whose
directors are Cannon Corporate Directors Limited and Cannon Corporate
Services Limited of PO Box 393, St Peter Port, Guernsey, GY1 3FN, Channel
Islands.
The change of control and mandatory offer
Encha Capital has undertaken to acquire 9 800 000 new ordinary shares
(post the capital restructure) from GVM Metals Limited ("GVM"), the
principal shareholder of Samroc, at 10 cents per new ordinary share. In
addition, Encha Capital has irrevocably undertaken to subscribe for 147
859 889 new ordinary shares in terms of the recapitalisation resulting in
Encha Capital holding a total of 57.9% of the issued shares. This will in
terms of the requirements of the SRP Code on Takeovers and Mergers ("the
Code"), lead to a change of control as defined in the Code with the
consequence that Encha Capital will be obliged to make an offer to
minority shareholders to acquire their new ordinary shares at 10 cents per
new ordinary share. Encha has underwritten the obligation to make such an
offer.
Rationale
The purpose of the capital restructure and the recapitalisation is to
place Samroc on a sound financial footing and to set it up as a black
controlled diversified mineral resources company that would focus on
acquiring mineral prospects, taking them up the value chain, and entering
into joint venture agreements with recognised operators to turn such
resources, primarily in South Africa but also in the SADC region, into
account.
Pro forma financial effects of the restructure and recapitalization
The table below sets out the unaudited pro forma financial effects of the
capital restructure and specific issue on Samroc. The unaudited pro forma
financial effects are presented for illustrative purposes only and because
of their nature may not give a fair reflection of Samroc`s results,
financial position and changes in equity after the capital restructure and
specific issue. It has been assumed for purposes of the pro forma
financial effects that the capital restructure and specific issue took
place with effect from 1 July 2006 for income statement purposes and 30
June 2007 for balance sheet purposes. The directors of Samroc are
responsible for the preparation of the unaudited pro forma financial
effects.
Before 1 After the capital After the capital % improvement
restructure 2 restructure and
recapitalisation
3
Published Pro forma Pro forma
Reviewed
(Loss) (0.23) (2.26) (0.08) 97%
per share
(cents)
Headline (0.23) (2.26) (0.08) 97%
(loss)
per share
(cents)
Net asset 0.30 2.97 8.76 295%
value per
share
(cents)
Tangible 0.30 2.97 8.76 295%
net asset
value per
share
(cents)
Number of 374 275 37 427 272 427
shares in
issue
(000)
Weighted 374 275 37 427 272 427
average
number of
shares in
issue
(000)
Notes and assumptions:
1. The "Before" financial information is based on Samroc`s published reviewed
results for the twelve months ended 30 June 2007.
2. The "After the capital restructure" financial information is based on the
consolidation on a 1 for 10 basis and the restructure of the issued share
capital of 374 274 923 ordinary shares of 1 cent each into 37 427 492
ordinary shares of no par value.
3. The "After the capital restructure and specific issue" financial
information is based on the following assumptions:
- the issued share capital of 374 274 923 ordinary shares of 1 cent
each is consolidated and restructured on a 1 for 10 basis into 37 427
492 ordinary shares of no par value;
- 235 million shares of no par value were subscribed for in terms of
the recapitalisation;
- net cash received from the recapitalisation will be utilised to repay
the GVM loan in full; and
- estimated costs relating to the implementation of the capital
restructure and recapitalisation of R760 000 have been written off
against share premium.
4. The pro forma financial information has been prepared in accordance with
IFRS and in terms of The Guide on Pro Forma Financial Information issued
by The South African Institute of Chartered Accountants, in line with the
JSE Limited Listings Requirements.
Documentation and further announcements
Documentation in relation to the capital restructure, the recapitalisation
and the mandatory offer is in the course of being prepared and will be
posted to shareholders upon receiving the appropriate regulatory
approvals.
A further announcement will be made giving the salient dates of the
mandatory offer once the relevant regulatory approvals have been given.
Withdrawal of cautionary announcement
While the company continues actively to evaluate a number of possible
investments, the discussions referred to in the cautionary announcement dated
26 September 2007 are not proceeding until after the completion of the
proposals set out herein. Accordingly, the cautionary announcement is
withdrawn.
Woodmead
1 November 2007
Sponsor Financed by Corporate adviser Independent
expert
Sasfin Capital Investec Lonsa (Pty)
(a division of Private Limited Mazars Moores
Sasfin Bank Bank Rowland Chartered
Limited) Accountants (SA)
Transactional Corporate legal Reporting
sponsor adviser accountants and
auditors
Tlotlisa Brink Cohen Le
Corporate Finance Roux Inc. Moore Stephens
(Pty) Limited MWM Inc
Date: 01/11/2007 16:07:33 Produced by the JSE SENS Department.
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