| Thu 2 Feb 2012, 15:05 | | ARQ - Anooraq Resources Corporation - Anooraq Anglo American Platinum Limited |
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ARQ
ARQ
ARQ - Anooraq Resources Corporation - Anooraq, Anglo American Platinum Limited
announce restructure, recapitalization and refinancing transaction for Anooraq
and Bokoni Group
Anooraq Resources Corporation
(Incorporated in British Columbia, Canada)
(Registration number 10022-2033)
TSXV/JSE share code: ARQ
NYSE AMEX share code: ANO
ISIN: CA03633E1088
("Anooraq" or the "Company")
ANOORAQ, ANGLO AMERICAN PLATINUM LIMITED ANNOUNCE RESTRUCTURE, RECAPITALIZATION
AND REFINANCING TRANSACTION FOR ANOORAQ AND BOKONI GROUP
Attention is drawn to the joint announcement dated February 2, 2012 in which
Anooraq Resources Corporation ("Anooraq" or the "Company") and Anglo American
Platinum Limited ("Amplats") (collectively, "the Parties") announced that they
have agreed to refinance Anooraq, restructure and recapitalize the Bokoni
Platinum group of companies ("Bokoni group") ("the transaction").
Key highlights of the transaction for Anooraq include:
- The Parties agree to a new strategic plan for the Bokoni group resulting in
the disposal of undeveloped platinum group metals (PGM*) ounces to Amplats,
recapitalization and refinancing of Anooraq and the Bokoni group, together with
accelerated production growth at Bokoni Platinum Mine. The new plan includes:
- accelerating production growth at Bokoni Platinum Mine through a new
ZAR2.6 billion (US$325 million) capital development programme, adding 100,000
PGM ounces per annum to the Bokoni Platinum Mine production profile by 2016,
which had previously been deferred until after 2020;
- implementing a strategic re-alignment of the Bokoni group exploration and
development mineral assets, by consolidating these assets into existing mine
operations at Amplats` Twickenham and Mogalakwena mines, as well as an enlarged
Bokoni Platinum Mines operation. The net effect of the strategic re-alignment is
that Anooraq will dispose of its entire interest in the Boikgantsho Project and
the Eastern section of the Ga-Phasha Project to Amplats for a net consideration
of ZAR1.7 billion (US$213 million) and utilize these proceeds to partially
reduce its debt outstanding to Amplats. Anooraq will continue to hold a 51%
majority interest in the enlarged Bokoni Platinum Mine with Amplats retaining a
49% minority interest.
- The Parties solidify a long-term strategic partnership by Amplats extending
its 26% equity investment in Anooraq through to 31 December 2018.
- The Parties agree to deleverage, recapitalize and refinance the Anooraq and
Bokoni group balance sheets by:
- entering into an interest standstill agreement effective 1 July 2011,
resulting in a ZAR300 million (US$37.5 million) interest saving for Anooraq;
- Anooraq utilizing the proceeds of the mineral asset disposal and interest
standstill agreement to reduce its debt owing to Amplats by 66% from
approximately ZAR3 billion (US$375 million) to approximately ZAR1 billion
(US$125 million);
- Anooraq consolidating all of its historical debt owing to Amplats (ZAR1
billion (US$125 million)) under one debt facility (the "Consolidated Debt
Facility");
- Amplats extending to Anooraq an additional amount of up to ZAR1.3 billion
(US$163 million) under the Consolidated Debt Facility to fund its share of
growth at the Bokoni Platinum Mine operations through to 2020, with a maximum
facility limit of ZAR2.3 billion (US$288 million);
- reducing Anooraq`s cost of borrowing from 16% to a weighted average
interest rate escalating from 0% to approximately 12% through to 2020, with a
low interest rate during the capital intensive growth phase at Bokoni Platinum
Mines through to 2016 as detailed in the indicative interest table below:
Debt balance 2012 2013 2014 2015 2016 2017 2018 2019 2020
(%) (%) (%) (%) (%) (%) (%) (%) (%)
First tranche 0.0 0.0 0.0 2.5 5.0 7.5 10.0 15.0 15.0
(ZAR1 billion)
Second tranche 5.0 5.0 10.0 10.0 12.5 15.0 15.0 20.0 20.0
(ZAR1 billion)
Third tranche 15.0 15.0 15.0 15.0 20.0 20.0 20.0 25.0 25.0
(ZAR300 million)
Estimated weighted 0.5 1.4 4.3 6.9 9.4 10.8 11.6 15.0 15.0
average interest
rate (%)
- Anooraq not being required to issue any new equity under the financial
restructure, recapitalization and refinancing plan.
- The Parties extending their existing concentrate purchase agreement between
Amplats and Bokoni Platinum Mine through to 2020 on the same terms.
- Amplats providing Anooraq with a working capital facility of ZAR90 million
(US$11 million) to fund its corporate and administrative expenses through to
2015.
- Amplats and Anooraq agreed on a new operating protocol for the management of
the Bokoni operations, which will increase Amplats` active involvement in areas
of the operations relating to mining, processing and capital projects execution.
- A new Managing Director, Dawid Stander, has been appointed at Bokoni Platinum
Mine (refer to the Company announcement of 1 February 2012).
Commenting on the transaction, Harold Motaung, the Chief Executive of Anooraq,
said, "This transaction lays the foundation for a sustainable future for Anooraq
and a workable growth plan at Bokoni Platinum Mine. We have worked closely with
our partners, Amplats, to put the right team and financial framework in place to
facilitate a fully funded and exciting new growth phase at Bokoni Platinum Mine
going forward."
Chief Executive Officer of Amplats, Neville Nicolau, commented, "This
transaction provides Amplats with access to mineral properties that provide
synergies with our operations at Mogalakwena and Twickenham. The refinancing and
restructuring position the Bokoni Platinum Mine for expansion into a substantial
and sustainable operation.
The transaction is in line with our commitment to black economic empowerment. We
seek not only to comply with the MPRDA but also to transfer technical, mining,
project execution and management skills to our joint venture partners. We
believe that this is a more sustainable BEE model. Our mining, process and
capital projects teams will become more involved in the day-to-day running of
the Bokoni Platinum Mine in order to facilitate skills transfer. We recognise
that the successful implementation of BEE policies in the mining industry
requires commitment and cooperation between mining companies, the BEE partners
and Government."
The DMR said, "We are pleased that the parties have made progress with their
restructure plan and look forward to them completing definitive agreements for
review by the regulator. We are encouraged that the transaction supports the
objectives of the MPRDA, read together with the Mining Charter and look forward
to seeing both Anooraq and the Bokoni group realising their full potential as
meaningful and significant participants in the South African PGM sector into the
future".
*PGM ounces refer to platinum, palladium, rhodium and gold
Conference call
This transaction announcement will be followed by a conference call hosted by
Anooraq and Amplats to discuss further details of the transaction at 10:00
Eastern Standard Time ("EST") (17:00 Central African Time ("CAT")) on Thursday,
February 2, 2012. The dial-in details for the conference call are listed below.
A playback will be available for three days after the call. The presentation to
be used during the call will be available for downloading on the Company`s
website at 09:30 EST (16:30 CAT) on Thursday, February 2, 2012.
Conference call dial-in details:
Conference call
Johannesburg, South 17:00 (local time) Toll: 011 535 3600
Africa Toll-free: 0 800 200 648
London, United 15:00 (local time) Toll-free: 0 800 917 7042
Kingdom
New York, United 10:00 (local time) Toll-free: 1 800 860 2442
States
Toronto, Canada 10:00 (local time) Toll-free: 1 866 605 3852
Other countries International toll: +27 11 535 3600
Playback facility
SA and other Code 2159# Toll: +27 11 305 2030
United Kingdom Code 2159# Toll-free: 0 808 234 6771
United States & Code 2159# Toll: 1 412 317 0088
Canada
Johannesburg
1 February 2012
JSE Sponsor
Macquarie First South Capital (Pty) Limited
Issued on behalf of Anooraq Resources Corporation
On behalf of Anooraq
Russell and Associates
Nicola Taylor
Office: +27 11 880 3924
Mobile: +27 82 927 8957
Macquarie First South Capital
Annerie Britz/ Yvette Labuschagne/ Melanie de
Nysschen
Office: +27 11 583 2000
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that
term is defined in policies of the TSX Venture Exchange) accepts responsibility
for the adequacy or accuracy of this release. The NYSE Amex has neither approved
nor disapproved the contents of this press release.
Cautionary and forward-looking information
This document contains "forward-looking statements" that were based on Anooraq`s
expectations, estimates and projections as of the dates as of which those
statements were made, including statements relating to the Bokoni Group
restructure and refinancing and anticipated financial or operational
performance. Generally, these forward-looking statements can be identified by
the use of forward-looking terminology such as "may", "will", "outlook",
"anticipate", "project", "target", "believe", "estimate", "expect", "intend",
"should" and similar expressions.
Anooraq believes that such forward-looking statements are based on material
factors and reasonable assumptions, including the following assumptions: the
Bokoni Mine will increase or continue to achieve production levels similar to
previous years; the Ga-Phasha, Boikgantsho, Kwanda and Platreef Projects
exploration results will continue to be positive; contracted parties provide
goods and/or services on the agreed timeframes; equipment necessary for
construction and development is available as scheduled and does not incur
unforeseen breakdowns; no material labour slowdowns or strikes are incurred;
plant and equipment functions as specified; geological or financial parameters
do not necessitate future mine plan changes; and no geological or technical
problems occur.
Forward-looking statements are subject to known and unknown risks, uncertainties
and other factors that may cause the Company`s actual results, level of
activity, performance or achievements to be materially different from those
expressed or implied by such forward-looking statements. These include but are
not limited to:
- uncertainties related to the completion of the Bokoni Group restructure and
refinancing;
- uncertainties and costs related to the Company`s exploration and development
activities, such as those associated with determining whether mineral resources
or reserves exist on a property;
- uncertainties related to feasibility studies that provide estimates of
expected or anticipated costs, expenditures and economic returns from a mining
project;
- uncertainties related to expected production rates, timing of production and
the cash and total costs of production and milling;
- uncertainties related to the ability to obtain necessary licenses, permits,
electricity, surface rights and title for development projects;
- operating and technical difficulties in connection with mining development
activities;
- uncertainties related to the accuracy of our mineral reserve and mineral
resource estimates and our estimates of future production and future cash and
total costs of production, and the geotechnical or hydrogeological nature of ore
deposits, and diminishing quantities or grades of mineral reserves;
- uncertainties related to unexpected judicial or regulatory proceedings;
- changes in, and the effects of, the laws, regulations and government policies
affecting our mining operations, particularly laws, regulations and policies
relating to:
- mine expansions, environmental protection and associated compliance costs
arising from exploration, mine development, mine operations and mine closures;
- expected effective future tax rates in jurisdictions in which our operations
are located;
- the protection of the health and safety of mine workers; and
- mineral rights ownership in countries where our mineral deposits are located,
including the effect of the Mineral and Petroleum Resources Development Act
(South Africa);
- changes in general economic conditions, the financial markets and in the
demand and market price for gold, copper and other minerals and commodities,
such as diesel fuel, coal, petroleum coke, steel, concrete, electricity and
other forms of energy, mining equipment, and fluctuations in exchange rates,
particularly with respect to the value of the U.S. dollar, Canadian dollar and
South African rand;
- unusual or unexpected formation, cave-ins, flooding, pressures, and precious
metals losses (and the risk of inadequate insurance or inability to obtain
insurance to cover these risks);
- changes in accounting policies and methods we use to report our financial
condition, including uncertainties associated with critical accounting
assumptions and estimates; environmental issues and liabilities associated with
mining including processing and stock piling ore;
- geopolitical uncertainty and political and economic instability in countries
which we operate; and
- labour strikes, work stoppages, or other interruptions to, or difficulties in,
the employment of labour in markets in which we operate mines, or environmental
hazards, industrial accidents or other events or occurrences, including third
party interference that interrupt the production of minerals in our mines.
For further information on Anooraq, investors should review the Company`s annual
Form 40-F filing with the United States Securities and Exchange Commission
www.sec.gov and annual information form for the year ended December 31, 2010 and
other disclosure documents that are available on SEDAR at www.sedar.com.
Date: 02/02/2012 15:05:14 Produced by the JSE SENS Department.
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