| Thu 31 May 2001, 0:00 | | Associated Manganese Mines - Disposal |
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The Associated Manganese Mines of SA Limited
(to be changed to "Assmang Limited")
(Incorporated in the Republic of South Africa)
(Registration number 1935/007343/06)
("Assmang" or "the company")
DISPOSAL OF THE FARM DWARS RIVIER PLATINUM GROUP METAL MINERAL RIGHTS AND
THE ASSOCIATED FREEHOLD
NM Rothschild & Sons is authorised to announce that, subject to the
conditions precedent detailed below, Assmang has reached agreement in terms
of which it has disposed of the Farm Dwars Rivier platinum group metal
mineral rights contained in the UG2 and Merensky reefs, and the associated
freehold ("the Dwars Rivier PGM rights") to Two Rivers Platinum
(Proprietary) Limited ("Two Rivers Platinum"). The shareholders of Two
Rivers Platinum are Anglovaal Mining Limited ("Avmin"), holding 55%, and
Impala Platinum Holdings Limited, holding 45%, (collectively "the
Purchaser"). An announcement by the Purchaser dealing with this transaction
appears elsewhere in this publication.
1. Rationale
Assmang acquired the mineral rights on the Farm Dwars Rivier ("the
property") in 1998, in order to exploit the chrome situated on the property,
as is currently occurring. Included in these rights are the Dwars Rivier PGM
rights. As Assmang is not involved in the platinum industry, the Dwars
Rivier PGM rights were regarded as non-core assets.
The proceeds from the disposal of this non-core asset will be applied to the
financing of Assmang's capital expenditure programme for its core businesses
of chrome, manganese, and iron ores, ferro-chrome and ferro-manganese. The
disposal process has resulted in the realisation of the Dwars Rivier PGM
rights in an efficient manner for Assmang shareholders without impinging on
the core business.
2. The disposal process
On 11 September 2001 Assmang announced that it was to explore the disposal
of the Dwars Rivier PGM rights. As Avmin owns 50.35% of the ordinary shares
in Assmang, and indicated that it was a potential purchaser of the Dwars
Rivier PGM rights, a subcommittee of the Assmang board, comprising
representatives independent of Avmin, was established to conduct the
disposal process, assisted by NM Rothschild & Sons. The disposal was
conducted by a competitive tender process.
3. The disposal
Subject to the fulfilment of the conditions precedent set out in paragraph 5
of this announcement, Assmang has disposed of the Dwars Rivier PGM rights
for a cash total consideration of R551 million, to be paid in cash on
transfer of the Dwars Rivier PGM rights.
4. The Dwars Rivier PGM rights
The Dwars Rivier PGM rights sold are specific to the UG2 and Merensky PGM-
bearing reef sequences, both of which outcrop within the surface rights
being soldthat are included in the associated freehold. The prospect forms
part of the Bushveld Igneous Complex, which contains the largest known
resources of platinum group metals, chromium and vanadium in the world. The
Farm Dwars Rivier is on the eastern lobe of the this complex where
significant outcrops of both the Merensky and UG2 reef sequences occur.The
consideration
5. Related party transaction
This transaction constitutes a related party transaction in terms of the JSE
Securities Exchange South Africa ("JSE Securities Exchange") Listings
Requirements and therefore will require a 75% shareholder approval,
excluding Avmin, at a general meeting of shareholders.
6. Financial effects
The table below sets out the pro-forma financial effects of the disposal on
the earnings of Assmang for the six month period ended 31 December 2000 and
the net asset value of Assmang as at 31 December 2000 based on:
The purchase consideration of R551 million;
Interest earned on positive cash balances was 10.25% (before tax); and
3 548 206 shares were in issue.
Per Assmang ordinary share Before After %
(Rands) (Rands) increase
Earnings * 29.81 35.38 18,69
Net asset value ** 302.22 457.51 51,38
* The effects on headline earnings and earnings are not materially
different.
** The effects on net asset value and net tangible asset value are not
materially different.
7. Conditions precedent
The disposal is subject to:
* Requisite approvals being obtained from the JSE Securities Exchange;
* The approval of the sale by 75% of the shareholders of Assmang, other than
Avmin, in general meeting; and
* Obtaining the necessary regulatory and statutory consents and
authorizations, such as those required from the Competition Commission, to
the extent necessary.
8. Circular
A circular, which is subject to JSE Securities Exchange approval, providing
full details of the disposal will be despatched to shareholders within 28
days of this announcement.
9. Other Matters
It was announced on 10 May 2001 that the ordinary shareholders of Assmang
had passed all necessary resolutions to give effect to the change of name of
the company to Assmang Limited. The new name has been reserved with the
Registrar of Companies ("the Registrar") and the special resolutions have
been lodged with the Registrar. It was announced on 10 May 2001 that the
name would be changed with effect from 28 May 2001, however the Registrar
has not yet registered the change of name. A further announcement will be
made in this regard in due course.
By order of the board
Johannesburg
31 May 2001
Independent Financial Advisor Attorneys
and Sponsor
NM Rothschild & Sons WWB
