| Wed 4 Jul 2012, 10:30 | | Metmar Ltd - FURTHER ANNOUNCEMENT REGARDING THE GENERAL AND SPECIFIC ISSUE OF SHARES FOR CASH AND THE FULENI ACQUISITION |
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MML
FURTHER ANNOUNCEMENT REGARDING THE GENERAL AND SPECIFIC ISSUE OF SHARES FOR CASH AND THE FULENI ACQUISITION
METMAR LIMITED
Incorporated in the Republic of South Africa
(Registration number 1998/007269/06)
Share code: MML
ISIN code: ZAE000078747
('Metmar' or 'the Company')
FURTHER ANNOUNCEMENT REGARDING THE GENERAL ISSUE OF SHARES
FOR CASH, THE SPECIFIC ISSUE OF SHARES FOR CASH, THE ACQUISITION
OF AN INTEREST IN THE FULENI ANTHRACITE PROJECT ('FULENI') ('THE
TRANSACTION') AND FURTHER CAUTIONARY ANNOUNCEMENT
Metmar shareholders ('Shareholders') are referred to the announcement published
by the Company on 7 June 2012 and 8 June 2012 on the Securities Exchange News
Service and in the South African press, respectively, ('Announcement') which set
out details of the Transaction entered into in terms of the heads of agreement dated
6 June 2012 ('Heads of Agreement').
PROGRESS ON PHASE 1 AND PHASE 2 OF THE TRANSACTION
Phase 1
Phase 1 comprised the issue of 34 866 072 new Metmar ordinary shares at a price of
R2.85 per ordinary share for cash to Wasat Investments (Proprietary) Limited
('Wasat'), the entity representing the Consortium previously referred to in the
Announcement, and Rupert Smith ('Smith') for a total amount of R99 368 305 in
terms of Metmar's general authority to issue shares for cash. This has been
successfully implemented and Metmar has advanced the cash received to Metmar
Investments and Resources (Proprietary) Limited ("MIR") by subscribing for 317
ordinary shares at par value of R1 per share in MIR for a consideration of R317 and
applying the remainder (being R99 367 988) as a shareholder loan owed by MIR to
Metmar.
Phase 2
Phase 2 involves the further issue of 43 478 261 new Metmar ordinary shares at a
price of R3.45 per ordinary share for cash to Wasat and Smith in terms of a specific
authority to issue shares for cash ('Specific Issue') for a total amount of
R150 000 000. Of this amount, R100 600 637 will be used to subscribe for 320
ordinary shares in MIR at par value of R1 per share for a consideration of R320 and
applying the remainder (being R100 600 317) as a shareholder loan owed by MIR to
Metmar. The remaining cash (being R49 399 363) will be used to reduce Metmar
group debt.
Phase 2 further involves the acquisition by MIR of an effective 55% interest in Fuleni
from Wasat ('Fuleni Acquisition') by acquiring 5% of the issued share capital of
Ibutho Coal (Proprietary) Limited ('Ibutho Coal'), 56% in the issued share capital of
Ibutho Coal Holdings (Proprietary) Limited ('Ibutho') (which entity holds 90% of
Ibutho Coal and 90% of Masa Mzantsi Cement (Proprietary) Limited ('Masa
Mzantsi')) and all claims against Ibutho, Ibutho Coal and Masa Mzantsi ('Sale
Assets').
The total purchase consideration payable by MIR to Wasat for the Sale Assets is
R225 000 000, to be settled partly through the issue of 263 ordinary shares in the
authorised share capital of MIR (which will constitute 26.3% of the entire issued
share capital of MIR on implementation of Phase 2) for a consideration of
R19 020 217 and the remainder (being R205 979 783) to be allocated as a
shareholder loan owed by MIR to Wasat.
Subsequent to the Heads of Agreement, the following agreements have been
entered into, in order to effect Phase 2:
' an agreement governing the Specific Issue ('Phase II Agreement');
' the sale and purchase agreement governing the Fuleni Acquisition ('Sale of
Fuleni Shares Agreement');
' the agreement entered into between Wasat, Metmar and MIR in terms of
which the conduct of the business and affairs of MIR and the relationship
between Metmar and Wasat as shareholders of MIR will be governed
('Shareholders' Agreement'); and
' the agreement entered into between Beacon Rock Corporate Services
(Proprietary) Limited ('BRCS') and Metmar in terms of which BRCS will
provide monthly and ad hoc services to the Metmar group, in relation to the
commercialisation, development and optimisation of metals and minerals
projects and any future opportunities in the metals and minerals industry
('Services Agreement');
(collectively 'Transaction Agreements').
The Services Agreement and the Shareholders Agreement are subject to the
successful implementation of the Phase II Agreement and the Sale of Fuleni Shares
Agreement.
Conditions precedent to Phase 2
Phase 2 is subject to the fulfilment, inter alia, of the following conditions precedent:
' the execution of the renewal of the Fuleni prospecting right;
' the Fuleni Acquisition having obtained the necessary approval from the
Competition Authorities and the Minister of Mineral Resources;
' the Metmar board approving the implementation of Phase 2; and
' Shareholders approving all the resolutions necessary for the implementation
of Phase 2.
FURTHER CAUTIONARY ANNOUNCEMENT AND CIRCULAR
Shareholders are advised to continue exercising caution when dealing in the
Company's securities until a further announcement containing the pro forma financial
effects of Phase 2 has been published. A circular containing full details of the
Transaction Agreements and incorporating a notice to convene a general meeting of
Shareholders will be posted to Shareholders in due course.
Johannesburg
4 July 2012
Transaction Sponsor and Sponsor
One Capital
Legal Advisors
Tabacks
Date: 04/07/2012 10:30:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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