| Wed 4 May 2011, 8:00 | | NHM - Northam Platinum Limited - Announcement relating to the proposed sale of |
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NHM
NHM
NHM - Northam Platinum Limited - Announcement relating to the proposed sale of
the Southern portion of the Booysendal mining right to Aquarius Platinum
NORTHAM PLATINUM LIMITED
(Incorporated in the Republic of South Africa)
(Registration Number: 1977/003282/06
(ISIN: ZAE000030912)
(Share Code: NHM)
("Northam" or "the Company")
ANNOUNCEMENT RELATING TO THE PROPOSED SALE OF THE SOUTHERN PORTION OF THE
BOOYSENDAL MINING RIGHT TO AQUARIUS PLATINUM (SOUTH AFRICA) (PROPRIETARY)
LIMITED, A WHOLLY OWNED SUBSIDIARY OF AQUARIUS PLATINUM LIMITED FOR R1.2 BILLION
IN CASH ("THE TRANSACTION")
Northam is pleased to advise of significant progress in finalising funding
arrangements to bring the Company`s Booysendal project into production by early
2013.
Northam and its wholly-owned subsidiaries Micawber 278 (Proprietary) Limited
("Micawber") and Khumama Platinum (Proprietary) Limited ("Khumama") have
concluded an agreement with Aquarius Platinum Limited ("AQP") and Aquarius
Platinum (South Africa) (Proprietary) Limited ("AQPSA") to dispose of the
mineral rights attached to the southern portion of Booysendal ("Booysendal
South") to AQPSA for an amount of R1.2 billion, net of value added tax and tax
charges arising from the disposal.
The purchase price is payable within one business day after the abandonment by
Micawber of such mining rights and their simultaneous inclusion in the Everest
South mining right of AQPSA. The agreement is subject to the fulfillment of
certain conditions, referred to below.
The Transaction will permit Northam to realise value from Booysendal South much
earlier than would otherwise have been the case.
The funds emanating from the Transaction will be applied to the development of
the Booysendal North UG2 ("BYD North UG2") mine, which is currently under
construction. The amount of R1.2 billion, plus cash of R650 million from the
acquisition of Mvelaphanda Resources Limited, funds on hand and future earnings
will contribute significantly to bringing the BYD North UG2 mine into production
as expeditiously as possible, thereby reducing the operating risk attaching to
the Company`s single operating asset, while adding some 60% to current metal
output.
The Transaction is classified as a category 2 transaction in terms of the JSE
Limited Listings Requirements.
In a separate agreement between Northam and AQPSA, provision is made for AQPSA
to assist Northam with access to a suite of infrastructural services from
AQPSA`s contiguous Everest property. This includes power, water, road access and
tailings disposal facilities. These services could potentially expedite the
development of the second phase of Northam`s Booysendal expansion.
The Booysendal mining right (including Booysendal South) comprises a 3PGE + Au
resource estimated at 103 million ounces, made up as follows:-
Merensky reef UG2 reef Total
(Moz) (Moz) (Moz)
Measured 6.1 13.8 19.9
Indicated 9.7 12.8 22.5
Inferred 22.7 38.2 60.9
Total 38.5 64.8 103.3
Given the constraints associated with the availability of Eskom power, Northam
plans to develop Booysendal on a phased, modular basis as illustrated on the
sketch plan available on the Northam website (www.northam.co.za). This approach
precludes Northam from accessing Booysendal South (which contains some 31.1Moz
(3PGE)) by mining development from the north for some 30 years.
The Booysendal South resource comprises:
Merensky reef UG2 reef Total
(Moz) (Moz) (Moz)
Measured 0.3 1.6 1.9
Indicated 1.7 5.8 7.5
Inferred 8.4 13.3 21.7
Total 10.4 20.7 31.1
The Booysendal South resource statement was compiled by Damian Smith BSc (Hons),
MSc, Pr.Sci.Nat. (400323/04), who has consented to the inclusion in this
announcement of the above information prior to publication thereof.
CONDITIONS PRECEDENT
The Transaction is subject, inter alia, to the following conditions precedent:
- Written consent by the Minister of Mineral Resources in terms, inter alia,
of Section 102 of the Mineral and Petroleum Resources Development Act 28 of
2002 to amend the Everest Mine Converted Mining Right to include Booysendal
South and to amend the Booysendal Converted Mining Right to exclude it;
- Regulatory approvals including, inter alia approval of the South African
Competition Commission; and
- A binding tax ruling from SARS, acceptable to the parties, confirming the
tax consequences of the Transaction.
The Transaction will become effective on the first business day after the
fulfillment or waiver, as the case may be, of the last condition precedent to
the Transaction.
PRO FORMA FINANCIAL EFFECTS AND CAUTIONARY ANNOUNCMENT
Shareholders are advised to exercise caution when dealing in the Company`s
securities until such time as a further announcement containing the pro forma
financial effects of the Transaction is published.
Johannesburg
4 May 2011
Attorneys
Bowman Gilfillan Inc.
Sponsor
One Capital
Date: 04/05/2011 08:00:01 Produced by the JSE SENS Department.
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