| Mon 5 Dec 2011, 8:00 | | GGM - Goliath Gold Mining Limited - Tender of 5 333 101 Gold One International |
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GGM
GGM
GGM - Goliath Gold Mining Limited - Tender of 5 333 101 Gold One International
Limited shares into the offer
GOLIATH GOLD MINING LIMITED
(Formerly White Water Resources Limited)
Incorporated in the Republic of South Africa
(Registration number 1933/004523/06)
Share code: GGM ISIN: ZAE000154753
("Goliath Gold" or "the Company")
TENDER OF 5 333 101 GOLD ONE INTERNATIONAL LIMITED SHARES INTO THE OFFER
1 INTRODUCTION
Shareholders are hereby advised that Goliath Gold, together with its wholly
owned subsidiary, Witnigel Investments Proprietary Limited ("Witnigel"),
intend to tender 5 333 101 of their Gold One International Limited ("Gold
One") ordinary shares into the cash offer by BCX Gold Investments Holdings
Limited ("BCX Gold") of A$0.55 per Gold One ordinary share ("Offer") ("the
Disposal of Gold One Shares").
2 THE DISPOSAL OF GOLD ONE SHARES
2.1 Nature of Gold One
Gold One is a gold producer listed on the financial markets operated by the
ASX Limited and the JSE Limited ("JSE"), issuer code GDO. Its flagship
operation is the newly built shallow Modder East mine on the East Rand,
some 30 kilometres from Johannesburg. Modder East is the first new mine to
be built in the region in 28 years and distinguishes itself from most of
the other gold mines in South Africa owing to its shallow nature (300
metres to 500 metres below surface). Gold One`s other projects and targets
include Ventersburg in the Free State Goldfields, the Tulo concession in
Mozambique and the Etendeka Greenfield project in Namibia.
On 16 May 2011, Gold One announced that it had entered into an agreement to
implement a transaction with a consortium of Chinese investors ("the
Consortium") whereby the Consortium is seeking to become the major
shareholder and long term strategic partner to Gold One. The transaction
comprises BCX Gold, a special purpose vehicle formed by the Consortium,
making the Offer and injecting a minimum A$150 million capital into Gold
One ("Gold One Transaction"). On 28 November 2011, Gold One announced that
the Gold One Transaction had become unconditional and that in order to
participate in the Offer, Gold One shareholders must accept the Offer by no
later than 15 December 2011.
2.2 The rationale for the Disposal of Gold One Shares
The main business of Goliath Gold, which has a primary listing on the JSE,
is that of a mining exploration company. Its subsidiaries are primarily
engaged in the resource sector.
On 12 November 2010, Goliath Gold (formerly White Water Resources Limited)
entered into an acquisition agreement with Gold One. The acquisition
agreement stipulates that Goliath Gold will acquire the Megamine Business,
as defined in the Goliath Gold Acquisition Circular dated 25 February 2011,
from Gold One Africa Limited ("Gold One Africa"), a wholly-owned subsidiary
of Gold One. The acquisition of the Megamine Business by Goliath Gold will
effectively result in a reverse takeover of the Company by Gold One Africa,
with Gold One Africa ultimately holding at least 71% of the share capital
in Goliath Gold.
Although shareholders voted overwhelmingly in favour of the transaction on
22 March 2011, subsequent to which a new management team was appointed, the
conclusion of the transaction is still dependent on the fulfillment of
certain conditions precedent, which relate mainly to regulatory approvals
that are pending.
Goliath Gold`s new management team is focused on creating value by
exploring and ultimately developing the Company`s extensive future asset
base. This has already begun in earnest with the first few exploration
drill holes at Megamine having already been completed by Gold One. Although
the majority of the current resources have a medium depth profile, a number
of shallower targets also exist which are being explored with a view to
providing initial development opportunities as well as the necessary
foundations to access the deeper resources in future. An economic scoping
study has already been initiated at Megamine.
Given that the main business of Goliath Gold is that of a mining
exploration company and that the ordinary shares held in Gold One by
Goliath Gold and Witnigel were always intended as available for sale
assets, the board of directors of Goliath Gold ("Board") believe that the
Disposal of the Gold One Shares will be beneficial to the Company and to
its shareholders as the proceeds will be used to fund the Company`s working
capital requirements.
2.3 Consideration and effective date
Goliath Gold, together with Witnigel, will receive the South African Rand
equivalent of a total of A$2 933 205.55 for the Disposal of the Gold One
Shares. BCX Gold has confirmed that shareholders who validly accept the
Offer on or before 7 December 2011 will receive payment on 23 December
2011, even if the Offer is extended.
2.4 Conditions precedent
The Disposal of the Gold One Shares is not subject to any conditions.
3 PRO FORMA FINANCIAL EFFECTS OF THE DISPOSAL OF GOLD ONE SHARES
The table below sets out the unaudited pro forma financial effects of the
Disposal of Gold One Shares on Goliath Gold`s earnings per share, headline
earnings per share, net asset value per share and net tangible asset value
per share.
The unaudited pro forma financial effects have been prepared to illustrate
the impact of the Disposal of Gold One Shares on the reported financial
information of Goliath Gold for the six months ended 30 September 2011, had
the Disposal of Gold One Shares occurred on 1 April 2011 for statement of
comprehensive income purposes and on 30 September 2011 for statement of
financial position 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 Goliath Gold for the year ended 31 March
2011.
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 Goliath Gold`s financial
position, changes in equity, results of operations or cash flow.
Before the After Percenta
Disposal the ge
of Gold Disposal change
One Shares of Gold (%)
One
Shares
Basic earnings per share 6.47 10.69 65.2
(cents)
Headline earnings per share 6.47 10.69 65.2
(cents)
Net asset value per share 76.79 81.11 5.6
(cents)
Net tangible asset value per 76.79 81.11 5.6
share (cents)
Weighted average number of 42 462 958 42 462
shares in issue 958
Notes:
1 The amounts in the "Before the Disposal of Gold One Shares" column have
been extracted from the reported results of Goliath Gold for the six months
ended 30 September 2011.
2 The amounts in the "After the Disposal of Gold One Shares" column reflect
the financial effects of the Disposal of Gold One Shares on Goliath Gold.
3 The effects on basic earnings per share and headline earnings per share are
calculated based on the assumption that the Disposal of Gold One Shares was
effected on 1 April 2011.
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 of Gold One
Shares was effected on 30 September 2011.
5 An exchange rate of A$1:ZAR8.23, being the closing spot rate as at 2
December 2011, has been used to calculate the pro forma financial effects.
4 CLASSIFICATION OF THE DISPOSAL OF GOLD ONE SHARES
The Disposal of Gold One Shares is classified as a Category 2 announcement
in terms of the Listings Requirements of the JSE.
Johannesburg
5 December 2011
Sponsor
Merchantec Capital
For further information contact:
Neal Froneman
Chief Executive Officer
+27 11 726 1047 (office)
+27 83 628 0226 (mobile)
neal.froneman@gold1.co.za
Ilja Graulich
Investor Relations
+27 11 726 1047 (office)
+27 83 604 0820 (mobile)
ilja.graulich@gold1.co.za
Date: 05/12/2011 08:00:01 Produced by the JSE SENS Department.
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