| Tue 17 Mar 2009, 10:26 | | SIM - Simmer And Jack Provides Financial Guarantee For Tau Lekoa Acquisition |
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SIM
SIIF
SIM - Simmer And Jack Provides Financial Guarantee For Tau Lekoa Acquisition
Simmer & Jack Mines, Limited
(Incorporated in the Republic of South Africa)
(Registration number 1924/007778/06)
Share code: SIM
ISIN Code: ZAE000006722
("Simmers")
SIMMER AND JACK PROVIDES FINANCIAL GUARANTEE FOR
TAU LEKOA ACQUISITION
Simmers announced today that it had furnished the financial guarantee required
by AngloGold Ashanti Limited ("AngloGold") for the acquisition of the Tau Lekoa
Mine, inclusive of the Weltevreden and Goedgenoeg properties ("Tau Lekoa").
As previously announced, the R600 million required to purchase Tau Lekoa was
raised through an offering by Simmers of 19 600 000 common shares of First
Uranium Corporation ("First Uranium") at a price of C$4.60 per share (the
"Offering") for aggregate gross proceeds of C$90 160 000. Additionally, Simmers
has granted to the underwriters an over-allotment option (the "Over-allotment
Option") which expires on 09 April 2009, to purchase up to 2 940 000 additional
shares on the same terms as set out above solely to cover over-allotments, if
any, and for market stabilization purposes.
Gordon Miller, chief executive of Simmers, said that the purchase of Tau Lekoa
was a strategic acquisition aimed at strengthening and growing Simmers` gold
operations and that the sale of a portion of its holding in First Uranium had
been an effective method of financing the acquisition during difficult economic
times.
"We have successfully financed the acquisition and raised sufficient funds to
facilitate the integration of Tau Lekoa into Buffelsfontein Gold Mine. Other
than the outstanding Over-allotment Option, that may or may not be exercised, we
have no intention of selling down our stake in First Uranium beyond what we
currently hold. We expect the market to re-rate First Uranium once it graduates
from a mine developer to a fully-fledged gold and uranium producer, and Simmers
would like to benefit from this to the fullest extent possible," said Miller.
Simmers currently owns 62 122 653 common shares of First Uranium, representing
41% of First Uranium`s 151 574 037 common shares issued and outstanding.
Should the Over-allotment Option on the Offering be exercised, this will raise
further gross proceeds of C$13.5 million for Simmers and reduce the ownership
level in First Uranium from its current level of 41% to 39%.
Simmers` percentage holding in First Uranium will also be affected from time to
time by the exercise of the common share purchase warrants (the "Warrants")
issued by First Uranium on 11 February 2009 in connection with a private
placement. An aggregate of 10 250 000 Warrants were issued by First Uranium and
each Warrant is exercisable for one common share at a purchase price of C$4.15
per share until 11 February 2011. Assuming that the entire Over-allotment
Option and all of the Warrants are exercised, Simmers` holding in First Uranium
would reduce to 37%.
About Simmers
Simmer & Jack is a gold and uranium miner focused on the development and
expansion of surface and underground operations in South Africa. These include a
41% stake in TSX and JSE-listed First Uranium Corporation which is aiming to
become a significant low-cost producer through the re-opening and underground
development of the Ezulwini Mine and the expansion of the Mine Waste Solutions
tailings recovery operation. Simmers` has two wholly-owned gold operations:
Buffelsfontein Gold Mine in the North West Province and Transvaal Gold Mining
Estates Limited (TGME) in the Pilgrim`s Rest/Sabie gold field. Simmers entered
into an agreement with AngloGold Ashanti on 17 February 2009 to purchase 100% of
the Tau Lekoa mine, situated 12 km`s from Buffelsfontein Gold Mine. The deal is
subject to certain conditions precedent and is expected to close on 01 January
2010.
For further information please contact Gail Strauss on 084 777 4060, or email
gail@simmers.co.za
Johannesburg
17 March 2009
Sponsor
Sasfin Capital
(A division of Sasfin Bank Limited)
Date: 17/03/2009 10:26:01 Produced by the JSE SENS Department.
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