| Tue 12 Oct 2010, 11:14 | | RNG - R&E - Distribution in Specie and Special Dividend to R&E Shareholders |
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RNG
RNG
RNG - R&E - Distribution in Specie and Special Dividend to R&E Shareholders
Randgold & Exploration Company Limited
(Incorporated in the Republic of South Africa)
(Registration number 1992/005642/06)
Share code: RNG
ISIN: ZAE000008819
("R&E" or "the Company")
DISTRIBUTION IN SPECIE AND SPECIAL DIVIDEND TO R&E SHAREHOLDERS
1. INTRODUCTION
Shareholders of R&E are advised that the board has approved a distribution in
specie of R&E`s shareholding in Gold Fields Limited ("Gold Fields"), comprising
2,270,687 ordinary shares in Gold Fields ("the Gold Fields Shares"), to
shareholders of R&E ("R&E Shareholders" or "the Shareholders") by way of a
reduction of share premium and a reduction of reserves in terms of section 90 of
the Companies Act, 61 of 1973, as amended. The board also approved a special
dividend of 90 cents per share to the R&E Shareholders by way of a payment from
retained earnings. The distribution in specie and the special dividend are
collectively referred to as "the Distributions" and result in a total
distribution of R310 million (at current market prices) or R4,32 per share. The
3 million treasury shares currently held within the R&E group will not
participate in the Distributions.
2. RATIONALE
During the past five years R&E has focused on the recovery of misappropriated
assets and during the same time resumed its trading and operational activities
to facilitate the preservation of shareholder value. By 5 July 2010 the company
had successfully recovered and distributed over 6 million and 1.5 billion
ordinary shares in Gold Fields and JCI Limited respectively. In addition, some R
250 million was recovered from various third parties in the form of assets and
cash.
Currently and subsequent to the 5 July 2010 distribution, R&E`s assets
effectively consist of net cash (after liabilities) of approximately R 260
million, 2,270,687 ordinary shares in Gold Fields and a suite of prospecting
rights.
The company`s current asset base is in excess of its medium term operational
requirements and it is therefore an opportune time to release further value to
the shareholders by way of the Distributions, as proposed. The Distributions as
proposed represent approximately 75% of the current market capitalisation.
3. DISTRIBUTION IN SPECIE
R&E Shareholders will receive approximately 3.161 Gold Fields shares for every
100 ordinary shares held in R&E.
4. PRO FORMA FINANCIAL EFFECTS
The unaudited pro forma financial effects of the Distributions, as set out below
are the responsibility of the directors of R&E. The unaudited pro forma
financial effects are presented in a manner consistent with the basis on which
the historical financial information has been prepared and in terms of R&E`s
accounting policies. The unaudited pro forma financial effects have been
presented for illustrative purposes only and, because of their nature, may not
give a fair reflection of R&E`s financial position, nor of the effect on future
earnings after the Distributions.
The table below sets out the unaudited pro forma financial effects of the
Distributions, based on the unaudited consolidated interim financial results for
the six months ended 30 June 2010 and on the assumption that:
- For calculating the earnings per share ("EPS") and headline earnings per
share ("HEPS"), the Distributions were effected on 1 January 2010; and
- For calculating the net asset value per share ("NAV") and net tangible
asset value per share ("NTAV"), the Distributions were effected on 30 June
2010.
Unaudited Unaudited
Before the Distributions After the Change
Distributions Distributions (%)
EPS (cents) 1103 2 1105 +0,2%
HEPS (cents) 1122 -15 1107 -1,3%
NAV per R&E 701 -398 303 -56,8%
share
(cents)
NTAV per R&E 701 -398 303 -56,8%
share
(cents)
Shares in 71,813,128 - 71,813,128 -
issue
throughout
the period
(excluding
treasury
shares)
Notes and assumptions:
1. The "Before the Distributions" EPS and HEPS have been extracted
without adjustment from the unaudited consolidated statement of
comprehensive income for the six months ended 30 June 2010.
2. The "Before the Distributions" NAV per share and NTAV per share have
been extracted without adjustment from the consolidated statement of
financial position for the six months ended 30 June 2010.
3. The "After the Distributions" EPS, HEPS, NAV per share and NTAV per
share have been adjusted to include the effect of the Distributions,
as well as estimated transaction costs of R781 576 (excluding VAT) and
expected STC and STT of R9,7 million.
4. The profit realised on the disposal of the Gold Fields Shares is
assumed to have no tax effect as it is off-set against the Company`s
calculated tax losses from prior years.
5. SHAREHOLDER APPROVAL AND CIRCULAR
The Distributions are subject to the passing of the requisite resolutions by the
shareholders of R&E at a general meeting approving the Distributions. In this
regard, to the extent that the distribution in specie and the special dividend,
when taken together, may be considered to be a disposal of the assets of the
Company as regulated by section 228 of the Companies Act, the Company will seek
the approval of the Distributions by way of a special resolution of the
Shareholders, as required by section 228 of the Companies Act. A circular will
be posted to shareholders in due course containing full details of the
Distributions and incorporating a notice convening the general meeting of
shareholders.
6. US SHAREHOLDERS
US shareholders are referred to the company`s website (www.randgoldexp.co.za),
specifically the announcement published on 8 July 2010 for information regarding
the US market.
Johannesburg
12 October 2010
Sponsor
PSG Capital (Pty) Limited
Date: 12/10/2010 11:14:01 Produced by the JSE SENS Department.
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