| Fri 13 Jun 2008, 9:13 | | CZA - Coal - Secures long term black empowerment status |
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CZA
CZA
CZA - Coal - Secures long term black empowerment status
Coal of Africa Limited
(previously, "GVM Metals Limited")
(Incorporated and registered in Australia)
(Registration number ABN 008 905 388)
Share code on the JSE Limited: CZA
ISIN AU000000CZA6
Share code on the Australian Stock Exchange Limited: CZA
ISIN AU000000CZA6
(`CoAL` or `the Company`)
SECURES LONG TERM BLACK EMPOWERMENT STATUS
Coal of Africa Limited ("CoAL" or "Company"), the AIM/ASX/JSE listed coal
development company operating in South Africa (ticker: CZA), is pleased to
announce that after several months of negotiations, agreement has been reached
with Coal Investments Limited ("CIL") whereby CIL will subscribe for shares and
options which if exercised, will result in African Global Capital I, L.P.
("AGC"), CIL and their affiliates holding in excess of 26% of the Company,
ensuring full compliance with South African legislative requirements for BEE
Groups to hold at least a 26% equity interest in mining companies by 2014 (the
"Agreement").
AGC is the first fund managed by the recently-formed private equity initiative
involving Mvelaphanda Holdings (Proprietary) Limited ("Mvela "), OZ Management
LP ("OZ Management"), an operating entity of Och-Ziff Capital Management Group
LLC (NYSE: OZM) ("Och-Ziff"), and Palladino Holdings Ltd. CIL is owned by
affiliated investment funds of Och-Ziff.
AGC currently owns 33,810,512 shares in CoAL. Such shares represent, pre-
issuance of the Placement Shares (as defined below), approximately 9.1% of
CoAL`s issued share capital. Post-issuance of the Placement Shares, CIL, AGC and
their affiliates will collectively own approximately 17.4% of CoAL`s issued
share capital and together with the options (assuming the Option Issuance (as
defined below) is approved by the shareholders of CoAL and exercised) will
collectively own approximately 26.4% of CoAL`s issued share capital.
CIL, AGC and their affiliates intend on transferring their shares and options
into a black empowered entity to ensure that CoAL is fully compliant with BEE
requirements.
"The Company`s BEE status is absolutely critical to the future of CoAL and the
Company is therefore pleased to have reached this agreement. The quality of our
BEE partner cannot be understated and we believe that Mvela, AGC and Och-Ziff
will add significant value to CoAL." said Simon Farrell, Managing Director of
CoAL.
"This is an important transaction for Mvela and AGC, as it strengthens our
relationship with CoAL which we see as a strategic investment. As we have done
in previous Mvela BEE transactions, we will bring together a broad based group
of beneficiaries to ensure that the historically disadvantaged community
benefits from exposure to the mining sector in South Africa." said Mark Willcox,
Chief Executive Officer of Mvela and recently-appointed Chief Executive Officer
of Africa Management (UK) Limited, a subsidiary of Africa Management Limited.
The Agreement consists of CoAL issuing 37,500,000 new ordinary shares in CoAL
("Placement Shares") at an issue price of GBP1.30 per Placement Share, to CIL,
raising up to GBP48.75 million. The Placement will represent approximately 9.1%
of CoAL`s issued capital as expanded by the issue of the Placement Shares, and
the Placement Shares will be issued out of the Company`s existing authorities.
The Placement Shares will be issued in two tranches. The first tranche will
comprise 25,500,000 shares being the number of shares that, when aggregated with
AGC`s existing shareholding in CoAL, will result in a holding of 14.9% of the
issued capital of the Company ("First Tranche"). The First Tranche will be
issued pursuant to ASX Listing Rule 7.1.
The balance of 12,000,000 shares ("Second Tranche"), or such lower number that
ensures CIL`s and AGC`s aggregate holding in CoAL does not exceed 20% of the
enlarged issued capital, will be issued upon the FIRB`s approval being obtained
and also pursuant to Listing Rule 7.1.
In addition to the Placement Shares, CoAL has agreed to issue CIL with
50,000,000 options (the "Option Issuance"), exercisable at GBP1.80 each within 2
years of the satisfaction of certain conditions, subject to CoAL obtaining
conversion of its Makhado (formerly Baobab) and Vele (formerly Thuli) New Order
Prospecting Rights to New Order Mining Rights within 12 months of the date of
entry of the option agreement ("Options"). The issue of the Options is subject
to shareholder approval at a meeting to be convened in due course.
The Agreement includes a condition that CIL cannot dispose of the Placement
Shares nor the Options within a period of 12 months from the issuance of the
First Tranche of Placement Shares, unless such disposal is to an affiliate of
CIL or another BEE group.
AUTHORISED BY:
Shannon Coates
Company Secretary
For more information contact:
Simon Farrell, Managing Director CZA +61 417 985 383
Olly Cairns / Romil Patel Blue Oar Securities Plc +618 6430 1631 or +44 20
7448 4400
Jos Simson/ Leesa Peters Conduit PR +44(0) 20 7429 6603
Petronella Gorrie The Event Shop +27 82 827 8815
www.coalofafrica.com
About CoAL:
Coal of Africa Limited ("CoAL") is primarily focused on the acquisition,
exploration and development of thermal and metallurgical coal projects. The
Company`s key projects, along with its leading metals processing company NiMag
Group (Pty) Ltd are in South Africa. The Company was incorporated in Western
Australia and listed in 1980. Since 2005, the Company has also listed on both
the AIM and JSE markets, allowing further growth in the Company`s coal assets.
About African Global Capital I, L.P.
AGC is the first fund managed by AML, the recently-formed private equity
initiative involving Mvela Holdings, OZ Management and Palladino Holdings Ltd.
AML has established AGC as a platform to invest in natural resources and related
businesses in both the private and public markets across Africa.
About Mvela Holdings
Mvela Holdings is one of the largest black-owned businesses in South Africa with
a strong and proven track record in significant and highly accretive investments
over a broad range of industries across Africa. A private investment company,
it was founded in 1998 by Tokyo Sexwale, Mikki Xayiya and Mark Willcox. It is
the controlling shareholder of JSE-listed Mvelaphanda Group Ltd and has a
significant interest in JSE-listed Mvelaphanda Resources Ltd. It has other
substantial interests in the mining, energy, real estate and various other
industrial sectors in South Africa and Africa.
About Och-Ziff Capital Management Group LLC
Och-Ziff is one of the world`s largest institutional alternative asset managers
with offices in New York, London, Hong Kong, Tokyo, Bangalore and Beijing. Och-
Ziff`s funds seek to deliver consistent, positive, risk-adjusted returns
throughout market cycles, with a strong focus on risk management and capital
preservation. Och-Ziff`s multi-strategy approach combines global investment
strategies, including merger arbitrage, convertible and derivative arbitrage,
equity restructuring, credit and distressed credit investments, private
investments and real estate. As of June 1, 2008, Och-Ziff had approximately
$33.8 billion in assets under management with over 700 investor relationships.
For more information, please visit www.ozcap.com.
13 June 2008
Sponsor
PricewaterhouseCoopers Corporate Finance (Pty) Ltd
Date: 13/06/2008 09:13:01 Produced by the JSE SENS Department.
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