| Thu 27 Nov 2008, 17:32 | | MTX - Metorex - Announcement |
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MTX
MEMTX
MTX - Metorex - Announcement
METOREX LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1934/005478/06)
JSE code: MTX
ISIN: ZAE000022745
("Metorex" or "the Company")
ANNOUNCEMENT REGARDING:
- A R3 BILLION CAPITAL AND DEBT RESTRUCTURING PROGRAMME;
- A SPECIFIC ISSUE OF SHARES FOR CASH;
- DECLARATION DATA IN TERMS OF A RENOUNCEABLE CLAW BACK OFFER;
- NOTICE OF GENERAL MEETING; AND
- FURTHER CAUTIONARY ANNOUNCEMENT
1. INTRODUCTION
Metorex`s liquidity position has been adversely affected by a number of factors
that were exacerbated by the recent decline in metal prices.
These factors include, inter alia:
- delays experienced in the commissioning and production ramp-up of the
Ruashi Copper Project undertaken by Metorex and its affiliates in the
Democratic Republic of the Congo ("the Ruashi Project");
- additional capital expenditure overruns on the Ruashi Project;
- further funding requirements arising from Metorex`s controlling
interest in Copper Resources Corporation ("CRC"); and
- the requirement to reinvest the copper hedge book profits from the
Ruashi Project into the project finance facility pertaining to the
Ruashi Project in order to maintain sound funding principles in the
light of recent metal price volatility and weakness.
At the end of October 2008, the Metorex group of companies ("Metorex Group") had
long-term and medium-term debt commitments totalling approximately R2.392
billion ("Metorex Group Debt"), comprising the following:
- R1.965 billion in respect of The Standard Bank of South Africa Limited
("Standard Bank"), Export Credit Insurance Corporation Limited and
other lenders` project finance facility pertaining to the Ruashi
Project ("the Ruashi Debt");
- R386 million in respect of the Chibuluma mining operation ("Chibuluma
Debt"); and
- R41 million in respect of other Metorex Group operations ("Other
Metorex Debt").
The repayment periods of the Metorex Group Debt vary from 42 months to 60 months
and the debt is mainly US Dollar denominated.
The recent weakening of the exchange rate further increased Metorex`s debt
exposure (expressed in South African Rands).
The board of directors of Metorex ("the Board") appointed Barnard Jacobs Mellet
Corporate Finance (Proprietary) Limited ("BJM") to assist the Company in co-
ordinating a suitable debt and capital restructuring programme to address the
Company`s immediate liquidity requirements and to ensure that Metorex is
adequately capitalised over the medium term ("the Capital and Debt Restructuring
Programme").
This announcement sets out the results and terms and conditions pertaining to
the Capital and Debt Restructuring Programme.
2. THE CAPITAL AND DEBT RESTRUCTURING PROGRAMME
BJM is authorised to announce that Metorex has entered into various agreements
that, subject to the fulfilment of the conditions detailed in this announcement,
will result in a R3 billion Capital and Debt Restructuring Programme, the
salient features of which are:
- a fresh equity capital injection of R744 million ("the Capital
Raising");
- a bridging finance facility of R300 million ("the Bridging Finance
Facility");
- a term loan facility (which converts from the Bridging Finance
Facility) being an amount after the set-off as described in paragraph
7 below ("the Term Loan Facility");
- a restructuring of the approximately R2 billion Ruashi Debt, as well
as the accompanying repayment terms with Standard Bank ("the Ruashi
Debt Restructuring Agreement"); and
- a waiver by Standard Bank of certain of its rights in terms of the
agreements pertaining to the Ruashi Debt in order to allow the
successful implementation of the Capital Raising and the above
mentioned other agreements ("the Waiver"),
(collectively referring to the Bridging Finance Facility, the Term Loan
Facility, the Ruashi Debt Restructuring Agreement and the Waiver hereinafter as
"the Banking Agreements").
3. PURPOSE AND APPLICATION OF THE CAPITAL AND DEBT RESTRUCTURING PROGRAMME
3.1 Funding required for the Ruashi Project
Metorex requires additional capital for the completion of
commissioning and the ramp-up to full production of the Ruashi
Project. The additional funding requirement arose principally as a
result of the following:
- increases in the scope and extent of the Ruashi Project from the
original feasibility study (which study was completed in 2006);
- commissioning delays, resulting in the loss of anticipated
revenue and cash flow from the project;
- delays in the completion of the cobalt circuit;
inflation-related capital cost escalations during the
construction and commissioning phases, particularly in relation
to stainless steel, cement and diesel prices; and
- further capital and social investment cost overruns.
Metorex estimates that it requires approximately R700 million of
additional funding to ensure completion and ramp-up to full production
of the Ruashi Project. The Capital Raising and, preceding full
implementation thereof, the Bridging Financing Facility, will be
applied principally towards the funding requirements relating to the
Ruashi Project.
In view of:
- the existing level of Ruashi Debt;
- the existing level of Metorex Group Debt; and
- the current global economic climate (including metal price
volatility),
the Board agreed that new equity capital was required to capitalise
Metorex appropriately in the medium-term, thus necessitating the
Capital Raising. Standard Bank agreed to provide the Bridging Finance
Facility (as more fully set out in paragraph 7 below) to allow Metorex
to implement the Capital Raising exercise.
3.2 Other funding requirements
Metorex is acutely aware of the recent volatility and weakness in
metal prices and the potential funding implication thereof on its
other operations. At present, Metorex`s principal non-copper key
operations (notably, Vergenoeg Mining Company (Proprietary) Limited
and Barberton Mines (Proprietary) Limited, the latter operated by
Metorex`s subsidiary, Pan African Resources PLC) are operating in line
with expectations and are generating significant cash flows.
Notwithstanding the above, Metorex considered it prudent to raise
sufficient capital to withstand further metal price weakness and other
market forces that could impact the Metorex Group`s cash flow position
in the foreseeable future.
3.3 Triggering the Banking Agreements
The Capital Raising and the Banking Agreements are inter-conditional.
As such, Metorex requires the implementation of the agreements
pertaining to the Capital Raising to ensure access to the additional
lending facilities and ancillary benefits to be derived from the
Banking Agreements.
3.4 The Ruashi Debt Restructuring Agreement
The repayment terms pertaining to the Ruashi Debt have been
restructured in order to allow Metorex and its affiliates in the
Ruashi Project the opportunity to complete commissioning and ramp-up
to full production in an orderly fashion.
To this end, the first capital repayment date on the Ruashi Debt has
been extended from 30 June 2009 to 31 December 2009 and the remainder
of capital and interest repayments have been extended by a similar
time frame.
The other terms and conditions pertaining to the Ruashi Debt have
remained materially unchanged, save for Metorex agreeing to provide
further security to Standard Bank, full details of which will be set
out in the circular to shareholders pertaining to the proposed
specific issue for cash, referred to in paragraph 13 below.
3.5 The Waiver
In terms of the Waiver, Standard Bank and other lending parties to the
Ruashi Debt Restructuring Agreement have agreed to waive, subject to
specified conditions, certain rights and conditions pertaining to the
existing agreements governing the Ruashi Debt. The purpose of the
Waiver is, inter alia, to allow:
- Metorex to raise further medium-term funding (as provided for in
the Bridging Finance Facility and the resultant Term Loan
Facility);
- implementation of the Ruashi Debt Restructuring Agreement; and
- implementation of the Capital Raising.
4. IMPLEMENTATION OF THE CAPITAL AND DEBT RESTRUCTURING PROGRAMME
At the date of this announcement, Metorex has 500 000 000 authorised
shares, of which 370 538 403 shares are in issue ("Issued Shares"),
resulting in 129 461 597 shares being authorised but unissued ("Unissued
Shares").
In order to access the funding provided by the Bridging Finance Facility
and to fulfil a condition precedent to the other agreements constituting
the Banking Agreements, Metorex agreed to place the full Unissued Shares
("Claw Back Shares") with certain parties. This part of the Capital Raising
is dealt with more fully in paragraph 6 below.
Furthermore, in order to provide certainty to Metorex`s lenders in terms of
the conditions precedent to the Banking Agreements, Metorex undertook and
forthwith placed a further 242 538 403 shares with the same parties, as
well as with Standard Bank, however this constitutes a conditional
subscription for shares subject to, inter alia, an increase in Metorex`s
authorised share capital. This element of the Capital Raising is dealt
with more fully in paragraph 5 below.
5. TERMS OF THE SPECIFIC ISSUE
At a general meeting of shareholders, details of which are set out in
paragraph 10 below ("the General Meeting"), authorisation will be sought
for Metorex to create a further 1 000 000 000 ordinary shares and issue
242 538 403 shares at an issue price of 200 cents per share ("the Issue
Price"), resulting in a total cash consideration of R485 076 806 to be
received from various parties before expenses ("the Specific Issue").
The Issue Price was determined by the Board after a book-building exercise
by BJM amongst selected institutions ("the Book-Build"). The Book-Build
simultaneously dealt with the allocation and issue price of the Claw Back
Offer, as more fully set out in paragraph 6 below.
The Issue Price represents a discount of 67% to the weighted average traded
price of Metorex shares for the 30 trading days ended on 20 November 2008,
being the day before the finalisation of the Book-Build. It represents a
48% discount to the weighted average traded price of Metorex shares for the
trading day ended on 20 November 2008.
In order to effect the Specific Issue, Metorex is required to increase its
authorised share capital. The Board has recommended an increase in the
authorised share capital of the Company to 1 500 000 000 ordinary shares
with a par value of 10 cents each.
The Specific Issue is, inter alia, conditional upon certain of the
suspensive conditions as set out in paragraph 8(ii) below.
At the date of listing of these shares, all the issued shares (including
the new shares to be issued) will be of the same class and will rank pari
passu in all respects.
No application will be made to the Financial Services Authority ("FSA") for
the new shares to be admitted to the Official List in the United Kingdom
and no application will be made to the London Stock Exchange ("LSE") for
the new shares to be admitted to trading on the LSE`s main market until the
Company has issued a prospectus to its shareholders.
The circular pertaining to the Specific Issue remains subject to JSE
Limited ("JSE") approval.
6. TERMS OF THE CLAW BACK OFFER
Metorex will proceed with a claw back offer for a total of 129 461 597
Unissued Shares ("the Claw Back Shares") offered to Metorex shareholders
recorded in the register as shareholders on Friday, 19 December 2008 ("the
Record Date") in the ratio of 34.94 shares for every 100 shares held at an
issue price of 200 cents per share ("the Claw Back Offer").
Fractional entitlements to Claw Back Shares arising from the Claw Back
Offer will be rounded down to the nearest whole number if they are less
than 0.5 and will be rounded up to the nearest whole number if they are
equal to or greater than 0.5. No excess applications will be allowed.
At the date of this announcement the Claw Back Offer is subject to, inter
alia, the Banking Agreements becoming unconditional.
The circular and letters of allocation pertaining to the Claw Back Offer
remains subject to JSE and the Companies and Intellectual Property
Registration Office ("CIPRO") approval.
7. TERMS OF THE BRIDGING FINANCE FACILITY
Standard Bank has agreed to provide Metorex with the Bridging Finance
Facility in terms of which a maximum amount of R300 million will be
extended to Metorex.
The salient terms of the Bridging Finance Facility are as follows:
- an upfront facility fee, equal to 5.0% of the facility amount (being
R300 million), payable out of the proceeds of the Claw Back Offer
undertaken by Metorex, shall be paid to Standard Bank within two days
of Metorex or its agent unconditionally receiving the cash proceeds
from the Claw Back Offer;
- interest is payable quarterly in arrears at a rate equal to JIBAR
(Johannesburg Interbank Agreed Rate) plus 7.5% per annum (nominal
annual compounded monthly);
- a commitment fee of 3.75% per annum will be charged on any committed
but undrawn amount of the Bridging Finance Facility from the earlier
of the first business day after the date on which the suspensive and
advance conditions are met and/or waived by Standard Bank or the date
on which Standard Bank makes any advance to Metorex on account of the
Bridging Finance Facility, and will be payable quarterly in arrears;
- draw down on the facility occurs at Metorex`s request and instance;
and
- Metorex may effect early repayment and/or cancellation of the whole or
any portion of the undrawn amount of the facility by providing notice
in writing to Standard Bank of not less than ten business days, in
respect of which Metorex shall not be liable for any penalties or
commitment or other fees.
Subsequent to implementation of the Capital Raising, the outstanding
balance on the Bridging Finance Facility will convert into a Term Loan
Facility, the salient terms and conditions of which are similar to the
Bridging Finance Facility, save for the fact that no upfront or facility
fee will be payable. Once converted, the final repayment date of the
balance of the Term Loan Facility, subject to certain conditions, will be
30 November 2009.
The equity contribution from Standard Bank arising from its participation
in the Specific Issue (refer to paragraph 5 above, as well as paragraph 8
below) shall be settled by means of set off against the outstanding balance
of the Bridging Finance Facility at the time of the Specific Issue. To the
extent that the outstanding balance of the Bridging Finance Facility is
less than the amount of Standard Bank`s equity subscription, the balance of
the subscription will be settled in cash.
Standard Bank`s equity contribution amounts to R122 million and, assuming
the full Bridging Finance Facility is drawn down at the time of the
Specific Issue, the Bridging Finance Facility will convert into a Term Loan
Facility with a facility amount of R178 million.
8. THE SUBSCRIBERS
The following entities have subscribed for the shares offered in terms of
the Capital Raising:
- Allan Gray Limited;
- Coronation Asset Management (Proprietary) Limited;
- The Industrial Development Corporation of South Africa Limited;
- Minerales Y Productos Derivados SA ("Minersa");
- The Public Investment Corporation Limited;
- Beankin Investments (Proprietary) Limited ("Beankin");
Standard Bank; and
- Stanlib Asset Management Limited,
(collectively referred to as "the Subscribers").
In terms of the subscription agreements entered into ("the Subscription
Agreements"), the Subscribers have irrevocably undertaken to subscribe for
242 538 403 shares in terms of the Specific Issue and 129 461 597 Claw Back
Shares at an issue price of 200 cents per share. Such subscriptions are on
the basis that the South African resident Metorex shareholders, recorded in
the register as such on the Record Date, be afforded the opportunity to
subscribe for the Claw Back Shares in terms of this announcement and the
circular to be posted to shareholders detailing the terms and conditions of
the Claw Back Offer (refer to paragraphs 11 and 12 below).
The salient features of the Subscription Agreements are detailed below:
i. Liquidity fee
In consideration for the Subscribers agreeing to subscribe for the
Claw Back Shares and paying the subscription price, Metorex shall pay
to the Subscribers a liquidity fee equal to 5% of the total value
subscribed for in terms of the Claw Back Offer.
ii. Suspensive conditions
The Subscription Agreements relating to the Specific Issue contain,
inter alia, the following suspensive conditions:
- the JSE agreeing to list the new shares issued in terms of the
Specific Issue;
- Metorex shareholders passing the special resolution authorising
an increase in the authorised share capital of Metorex and such
resolution being duly registered by CIPRO;
- approval of the Specific Issue by not less than a 75% majority of
the votes cast in favour of a general resolution by all Metorex
shareholders, which are not disqualified from doing so in terms
of the Listings Requirements of the JSE ("Listings
Requirements");
- the Banking Agreements becoming unconditionally operative;
- the Subscribers entering into a subscription agreement with the
Company in respect of the Claw Back Offer and such agreement
becoming unconditionally operative; and
- Metorex entering into conditional subscription agreements which,
together with the subscription for all the Unissued Shares,
constitutes a capital raising of no less than R 700 million.
iii. Irrevocable undertakings
In terms of the Subscription Agreements, the Subscribers representing
approximately 40.3% of the Issued Shares have provided Metorex with
irrevocable undertakings stating that they will vote in favour of the
resolutions pertaining to the increase in authorised share capital and
the Specific Issue.
iv. Related parties
Minersa and Beankin are classified as "related parties" in terms of
the Listings Requirements. Accordingly, the Board has appointed an
independent expert to provide a fairness opinion in accordance with
the Listings Requirements. Their opinion and the subsequent opinion of
the Board will be included in a circular to shareholders, the details
of which are provided in paragraph 12 below.
v. Ruling from the Securities Regulation Panel ("SRP") on Take-Overs and
Mergers ("the Code")
The SRP has issued a ruling to the effect that the Capital Raising
does not constitute an affected transaction, as defined in the Code.
9. FINANCIAL EFFECTS OF THE CAPITAL RAISING
The table below sets out the unaudited pro forma financial effects of the
Capital Raising and Term Loan Facility based on the Company`s published
preliminary results for the year ended 30 June 2008 and are presented in a
manner consistent with the format and accounting policies adopted by
Metorex.
The unaudited pro forma financial effects are presented for illustrative
purposes only and because of their nature may not give a fair reflection of
the Company`s financial position after the Capital Raising. It has been
assumed for purposes of the pro forma financial effects that the Capital
Raising took place with effect from 30 June 2008 for balance sheet purposes
and 1 July 2007 for income statement purposes.
It has also been assumed that the Capital Raising will amount to R744
million with the Specific Issue`s cash consideration amounting to R485 076
806 and the Claw Back Offer being subscribed for at a total amount of R258
923 194. The Term Loan Facility has been assumed to be drawn down by
R178 million at the respective dates.
These pro forma financial effects are the responsibility of the directors
of Metorex and have not been reviewed by Metorex`s auditors.
After
the
Specific After the Term
Issue Loan Facility
Before Movement
(cents) (cents) (%) (cents)
Net asset value 934.60 641.10 -31.4 638.60
per share1
Net tangible 871.40 603.00 -31.0 600.50
asset value per
share1
Earnings per 159.40 93.90 -41.1 86.10
share2
Diluted earnings 156.50 92.90 -41.0 85.10
per share3
Headline 131.70 77.60 -41.1 69.70
earnings per
share4
Diluted headline 129.30 76.80 -41.0 69.00
earnings per
share5
Weighted average 347,797 590,335 70.0 590,335
number of shares
in issue (000)6
Weighted average 354,447 596,985 68.4 596,985
diluted number
of shares in
issue (000)7
Number of shares 369,173 611,711 66.0 611,711
in issue (000)8
Table continued
After
the Claw
Back Total movement
Movement Offer Movement
(%) (cents) (%) (%)
Net asset value -0.4 559.20 -12.4 -40.2
per share1
Net tangible -0.4 527.70 -12.1 -39.4
asset value per
share1
Earnings per -8.3 70.60 -18.0 -55.7
share2
Diluted earnings -8.4 69.90 -17.9 -55.3
per share3
Headline -10.2 57.20 -17.9 -56.6
earnings per
share4
Diluted headline -10.2 56.70 -17.8 -56.1
earnings per
share5
Weighted average 0.0 719,797 21.9 107.0
number of shares
in issue (000)6
Weighted average 0.0 726,447 21.7 105.0
diluted number
of shares in
issue (000)7
Number of shares 0.0 741,173 21.2 100.8
in issue (000)8
Notes:
1. Net asset value per share is computed by dividing total equity by the
number of shares in issue. Net tangible asset value per share is
computed by dividing total equity (excluding intangible assets) by the
number of shares in issue.
2. Earnings per share is computed by dividing net profit attributable to
equity holders of parent by the weighted average number of shares in
issue.
3. The diluted earnings per share is computed by dividing net earnings
attributable to the equity holders of parent by the weighted average
diluted number of shares in issue.
4. Headline earnings removes items of a capital nature and earnings in
respect of discontinued operations from the calculation of earnings
per share. Headline earnings per share is computed by dividing
headline earnings by the weighted average number of shares in issue.
5. The diluted headline earnings per share is computed by dividing net
headline earnings attributable to the equity holders of parent by the
weighted average diluted number of shares in issue.
6. The weighted average number of Metorex shares in issue was 347.797
million for the year ended 30 June 2008 and as a result of the
issuance of 242.538 million and 129.462 million Metorex Shares in
respect of the Specific Issue and the Claw Back Offer, respectively,
the weighted average number of Metorex shares in issue for that period
would have been 590.335 million and 719.797 million shares after the
Specific Issue and Claw Back Offer, respectively.
7. The weighted average diluted number of Metorex shares in issue for the
year ended 30 June 2008 does assume the effect of 6.65 million shares
issuable upon the exercise of the share incentive options.
8. The number of Metorex shares in issue as at 30 June 2008 was 369.173
million and, as a result of the issues of shares, the number of
Metorex shares in issue as at that date would have been 611.711
million and 741.173 million after the Specific Issue and Claw Back
Offer, respectively.
9. Estimated issue and related issue expenses comprise the following:
Description Specific Issue Claw Back Offer
(R) (R)
Placement fees 12,126,920 6,473,080
Liquidity fee - 12,946,160
Legal fees 1,000,000 1,000,000
Other costs 593,000 438,000
Total 13,719,920 20,857,240
10. The following costs in respect of the Term Loan Facility were taken
into account:
Description Pro forma income Pro forma balance
statement sheet
(R) (R)
Facility fee 15,000,000 15,000,000
Interest expense * 33,483,900 -
Total 48,483,900 15,000,000
* Assuming an amount of R 178 million is drawn down upon inception and
remains outstanding for the entire period.
11. The issue price per Metorex share was assumed to be R2.00 in respect
of the Claw Back Offer and the Specific Issue.
10. SALIENT DATES AND TIMES OF THE SPECIFIC ISSUE
Set out below are the proposed salient dates and times pertaining to the
Specific Issue:
Date
Circular posted to shareholders on Monday, 1 December 2008
Last day to lodge forms of proxy for
the General Meeting by 10h00 on Friday, 19 December 2008
General Meeting of shareholders to be
held at The Kwacha Room, The Rosebank
Hotel, Corner Tyrwhitt and Sturdee Tuesday, 23 December 2008
Avenue, Rosebank 10h00 on
Results of General Meeting published Tuesday, 23 December 2008
on SENS on
Results of General Meeting published Wednesday, 24 December 2008
in press on
Notes:
1. All dates and times are South African dates and times unless otherwise
stated.
2. Holders of dematerialised shares are required to notify their CSDP or
broker of the action they wish to take in respect of the General
Meeting in the manner and by the time stipulated in the agreement
governing the relationship between the Metorex shareholder and his
CSDP or broker, although the directors recommend that such
notification be given not less than 5 (five) days prior to the General
Meeting.
11. SALIENT DATES AND TIMES OF THE CLAW BACK OFFER
Set out below are the proposed salient dates and times pertaining to the
Claw Back Offer:
Date
Last day to trade in Metorex shares on the
JSE in order to participate in the Claw Thursday, 11 December
Back Offer (cum rights) on 2008
Metorex shares trade ex Claw Back Offer Friday, 12 December 2008
rights on the JSE on
Listing and trading on the JSE of the
renounceable letters of allocation from the Friday, 12 December 2008
commencement of trade on
Record date in order to be entitled as a
Metorex shareholder to participate in the Friday, 19 December 2008
Claw Back Offer
Claw Back Offer opens at 09h00 and the
circular including form of instruction, Monday, 22 December 2008
where applicable, is posted to shareholders
on
Dematerialised shareholders will have their
accounts at their CSDP or broker
automatically credited with their
renounceable letters of allocation. Monday, 22 December 2008
Certificated shareholders will have letters
of allocation credited electronically to an
account at Link Market Services South
Africa (Pty) Limited on
Last date to trade in the renounceable
letters of allocation on the JSE in order Friday, 9 January 2009
to settle by Friday, 16 January 2009 on
Listing and trading on the JSE of Claw Back Monday, 12 January 2009
Shares commences at 09h00 on
Claw Back Offer closes at 12h00 and payment
and forms of instruction to be received by Friday, 16 January 2009
the transfer secretaries on (see notes 1
and 5)
Results of Claw Back Offer announcement Monday, 19 January 2009
released on SENS on
Expected date from which share certificates
are mailed in respect of certificated
shareholders or accounts at the relevant
CSDP or broker are updated with their new Monday, 19 January 2009
shares and debited with the costs of the
purchase in respect of the dematerialised
shareholders on
Announcement giving results of the Claw Tuesday, 20 January 2009
Back Offer published in the press on
Notes:
1. Dematerialised shareholders are required to notify their duly
appointed CSDP or broker of their acceptance of the Claw Back Offer in
the manner and time stipulated in the agreement governing the
relationship between the shareholder and his CSDP or broker.
2. All times indicated are South African times unless otherwise stated.
3. Share certificates may not be dematerialised or rematerialised between
Friday, 12 December 2008 and Friday, 19 December 2008, both days
inclusive.
4. The CSDP / broker accounts of dematerialised shareholders will be
automatically credited with new Metorex shares to the extent to which
they have accepted the Claw Back Offer on Monday, 19 January 2009.
Metorex share certificates will be posted, by registered post at the
shareholders` risk, to certificated shareholders in respect of the
Claw Back Offer shares which have been accepted on or about Monday, 19
January 2009.
5. CSDPs or brokers effect payment in respect of dematerialised
shareholders on a delivery versus payment method.
12. INVESTORS OUTSIDE SOUTH AFRICA
The Claw Back Shares have not been and will not be registered for the
purposes of the Claw Back Offer under the securities laws of the United
Kingdom, Canada, United States of America or any other country except South
Africa and accordingly, except as stated below, are not being offered,
sold, taken up, re-sold or delivered directly or indirectly to shareholders
with registered addresses outside South Africa ("Non-Resident
Shareholders").
Therefore, the circular detailing details of the Claw Back Offer will be
sent to them for information purposes only. In this regard, the approval of
CIPRO in terms of section 142(2) (a) of the Companies Act has been sought,
to the effect that Metorex is not obliged to extend the Claw Back Offer to
shareholders who are not resident in the Republic of South Africa. The
rights attributable to such rights Non-Resident Shareholders will, if a
premium can be obtained over the expenses of sale, be sold on the JSE, for
the benefit of such Non-Resident Shareholders as soon as practicable.
However, if the net proceeds of sale in relation to any such rights
recipient are less than R5.00, they will be retained for the benefit of
Metorex.
No renounceable letters of allocation will be sent, therefore, to any
shareholder whose registered address is in the United Kingdom, Canada, the
United States or any other country except South Africa.
As at the date of listing of the Claw Back Shares, all the issued shares
(including the Claw Back Shares) will be of the same class and will rank
pari passu in all respects.
No application will be made to the FSA for the Claw Back Shares to be
admitted to the Official List in the United Kingdom and no application will
be made to LSE for the Claw Back Shares to be admitted to trading on the
LSE`s main market until the Company has issued a prospectus to its
shareholders.
This document is not a prospectus but comprises an advertisement for the
purposes of paragraph 3.3.2R of the United Kingdom prospectus rules made
under Part VI of the Financial Services and Markets Act 2000.
A prospectus will be published in due course, copies of which will,
following production, be available from the registered offices of Metorex
and from the offices of Beaumont Cornish Limited.
13. DETAILS OF CIRCULARS TO SHAREHOLDERS
A circular to shareholders containing details of the proposed increase in
the authorised share capital and the Specific Issue and a notice of the
General Meeting will be posted to shareholders on or about Monday, 1
December 2008.
A circular to shareholders containing details of the Claw Back Offer will
be posted to shareholders on or about Monday, 22 December 2008.
14. FURTHER CAUTIONARY ANNOUNCEMENT
Shareholders are referred to the cautionary announcement dated 10 November
2008 and are advised that Metorex remains involved in negotiations which
may have an effect on the price of the Company`s securities. Accordingly,
shareholders are advised to continue to exercise caution when dealing in
the Company`s shares until a further announcement is made.
Johannesburg
27 November 2008
Corporate advisor, sole book-runner and lead sponsor on the JSE to Metorex
Barnard Jacobs Mellet Corporate Finance (Pty) Limited
Independent sponsor on the JSE to Metorex
Deloitte & Touche Sponsor Services (Pty) Limited
South African legal advisor to Metorex
Bowman Gilfillan Incorporated
South African legal advisor to Barnard Jacobs Mellet Corporate Finance (Pty) Ltd
Cliffe Dekker Hofmeyr Inc.
United Kingdom legal advisor to Barnard Jacobs Mellet Corporate Finance (Pty)
Ltd
DLA Piper UK LLP
United Kingdom legal advisors to Metorex
Maclay Murray & Spens LLP
Investment Bank to Standard Bank and Bankers to Metorex
Standard Bank
South African legal advisor to the Standard Bank of South Africa Limited
Deneys Reitz Inc.
English Law legal advisors to the Standard Bank of South Africa Limited
Africa Legal
Date: 27/11/2008 17:32:47 Produced by the JSE SENS Department.
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