| Wed 30 Sep 2009, 17:15 | | LON - Lonmin Plc - Update on Incwala Resources (Pty) Ltd |
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LON
LOLMI
LON - Lonmin Plc - Update on Incwala Resources (Pty) Ltd
Lonmin Plc (Incorporated in England and Wales)
(Registered in the Republic of South Africa under registration number
1969/000015/10)
JSE code: LON
Issuer Code: LOLMI & ISIN: GB0031192486 ("Lonmin")
Update on Incwala Resources (Pty) Ltd
Lonmin Plc ("Lonmin" or "the Company") today provides an update regarding
Incwala Resources (Pty) Ltd ("Incwala"), Lonmin`s Black Economic Empowerment
partner.
Lonmin confirms that discussions are on-going with the Historically
Disadvantaged South African ("HDSA") shareholders of Incwala and the HDSAs`
providers of finance regarding the future ownership of Incwala.
There can be no certainty that these discussions will be successfully concluded
and, if no conclusion is reached, there is a possibility that Lonmin could be
called upon under guarantees given at the time of the formation of Incwala in
2004. In these circumstances, these guarantees would be funded from Lonmin`s
existing bank facilities.
A further announcement will be made as and when appropriate.
- Ends -
30 September 2009
ENQUIRIES:
Investors / Analysts:
Rob Gurner + 44 (0) 207 201 6050
Head of Investor Relations
Media:
Cardew Group + 44 (0) 207 930 0777
Anthony Cardew / Rupert Pittman
Financial Dynamics + 27 (0) 11 214 2400 / 2410
Dani Cohen / Ravin Maharaj
Notes to Editors:
Lonmin was a key facilitator of the original BEE transaction with Incwala
Resources in September 2004, and was a provider of certain vendor financing,
third party loan indemnifications and related arrangements which enabled broad-
based equity participation by HDSA shareholders in Lonmin`s assets.
A substantial proportion of the HDSA shareholders` bank-funded debt and vendor-
financed debt is due to mature in September 2009 and will require refinancing.
If the HDSA shareholders are unsuccessful in their attempts to secure
refinancing of their debts then it is possible that some or all of Lonmin`s
contingent liabilities in respect of such debts may crystallise. As at 31 March
2009, Lonmin recognised contingent liabilities associated with these
arrangements of a maximum of R930 million, of which R177 million would not
become payable until 30 September 2011, if at all. Further details of these
contingent liabilities can be found in Note 10 on page 34 of Lonmin`s 2009
Interim Report for the six months ending 31 March 2009.
However, it is also possible that alternative solutions involving the
participation of Lonmin could be found, some of which could involve an economic
cost to Lonmin in excess of the currently recognised contingent liabilities.
Such solutions will only be considered if the Board believes they will promote
the success of Lonmin for the benefit of its shareholders.
Date: 30/09/2009 17:15:35 Produced by the JSE SENS Department.
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