| Tue 10 Feb 2009, 14:39 | | MTZ - Matodzi Resources - Disposal Of 100 752 612 JCI Limited Shares And |
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MTZ
MTZ
MTZ - Matodzi Resources - Disposal Of 100 752 612 JCI Limited Shares And
Withdrawal Of Cautionary Announcement
MATODZI RESOURCES LIMITED
Incorporated in the Republic of South Africa
(Registration number 1933/004523/06)
Share code: MTZ ISIN: ZAE000042412
("Matodzi" or "the company")
DISPOSAL OF 100 752 612 JCI LIMITED SHARES AND WITHDRAWAL OF CAUTIONARY
ANNOUNCEMENT
1. INTRODUCTION
Further to the announcement released on SENS on 22 January 2009, shareholders
are advised that Matodzi has entered into an agreement with Trinity Asset
Management (Proprietary) Limited ("TAM") to dispose of 100 752 612 of its JCI
Limited ("JCI") ordinary shares to TAM in exchange for 10 605 540 Aflease Gold
Limited ("Afgold") ordinary shares ("the disposal"). The exchange ratio is
approximately 9.5 JCI ordinary shares for each Afgold ordinary share.
TAM has an established share swapping facility with Afgold which it will utilise
to obtain an equal exchange ratio being, 10 605 540 Afgold shares for 100 752
612 JCI shares.
In terms of the Listings Requirements of JSE Limited ("JSE"), the disposal
constitutes a Category 1 transaction which requires a circular to shareholders,
as referred to in paragraph 4 below.
In addition, the disposal constitutes an affected transaction in terms of the
Securities Regulation Code on Takeovers and Mergers and the Rules of the
Securities Regulation Panel ("SRP") ("the Code"). The Code accordingly requires
the board to obtain appropriate external advice and RAiN Chartered Accountants
SA has been appointed to assist the board in this regard, and such external
advice will be included in the circular to shareholders.
2. THE DISPOSAL
2.1 Nature of JCI
JCI is a specialised resource finance house investing in opportunities in South
Africa and elsewhere in Africa, the shares of which are listed on the Main Board
of JSE Limited ("JSE"), but which shares are currently suspended.
2.2 The rationale for the disposal
It has been the intention of the board of Matodzi ("the board") to reduce the
direct exposure that the company has in JCI and therefore, the disposal of its
remaining shareholding in JCI, being 100 752 612 ordinary shares, is in line
with the company`s strategy. Furthermore, the board believes that the holding of
Afgold shares is in its shareholders` best interest when compared to the holding
of suspended shares in JCI, whose future as a listed entity remains uncertain.
2.3 Consideration
Matodzi has received 10 605 540 Afgold ordinary shares for the disposal of the
100 752 612 JCI ordinary shares at an exchange ratio of approximately 9.5 JCI
ordinary shares for each Afgold ordinary share. The board believes that holding
the Afgold ordinary shares in the interim is in its shareholders` best interest.
2.4 Conditions precedent and effective date
The disposal is conditional upon:
- regulatory approvals from JSE and the SRP; and
- approval by way of a special resolution by shareholders at the general
meeting.
- The effective date of the disposal is 5 February 2009.
3. PRO FORMA FINANCIAL EFFECTS OF THE DISPOSAL
The table below sets out the unaudited pro forma financial effects of the
disposal on Matodzi`s earnings per share, headline earnings per share, net asset
value per share and tangible net asset value per share.
The unaudited pro forma financial effects have been prepared to illustrate the
impact of the disposal on the reported financial information of Matodzi for the
six months ended 30 September 2008, had the disposal occurred on 1 April 2008
for income statement purposes and on 30 September 2008 for balance sheet
purposes.
The unaudited pro forma financial effects have been prepared using accounting
policies that comply with International Financial Reporting Standards and that
are consistent with those applied in preparing the annual financial statements
of Matodzi for the year ended 31 March 2008.
The unaudited pro forma financial effects, which are the responsibility of the
directors, are provided for illustrative purposes only and, because of their pro
forma nature, may not fairly present Matodzi`s financial position, changes in
equity, results of operations or cash flow.
Before the After the Percenta
disposal disposal ge
change
(%)
Basic earnings per share (1.86) (1.77) 5
(cents)
Headline earnings per share (1.86) (1.77) 5
(cents)
Net asset value per share 8.10 8.20 1
(cents)
Tangible net asset value per 8.10 8.20 1
share (cents)
Weighted average number of 370 547 370 547
shares in issue (000`s)
Notes:
1. The amounts in the "Before the disposal" column have been extracted from
the reported results of Matodzi for the six months ended 30 September 2008 after
taking into account the disposal of 105 015 461 JCI ordinary shares to Investec
Limited as set out in the announcement released on SENS on 22 January 2009.
2. The amounts in the "After the disposal" column reflect the financial
effects of the disposal on Matodzi.
3. The effects on basic earnings per share and headline earnings per share are
calculated based on the assumption that the disposal was effected on 1 April
2008.
4. The effects on net asset value per share and tangible net asset value per
share are calculated based on the assumption that the disposal was effected on
30 September 2008.
4. CLASSIFICATION OF THE DISPOSAL
A circular containing full details of the disposal and a notice to convene a
general meeting of Matodzi shareholders in order to consider and, if deemed fit
to pass, the resolution necessary to ratify the disposal, will be sent to
Matodzi shareholders in due course.
5. WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT
The cautionary announcement is accordingly withdrawn.
10 February 2009
Sponsor
Merchantec (Proprietary) Limited
Legal adviser
Russell Turner Attorneys
Independent external adviser
RAiN
Date: 10/02/2009 14:39:01 Produced by the JSE SENS Department.
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