Cautionary
RARE EARTH EXTRACTION CO. LIMITED
(Registration number 1989/003212/06)
JSE code : RCO - ISIN code : ZAE000005807
("Rareco")
Withdrawal of litigation Issue of shares for cash and Withdrawal of
Cautionary
Following a cautionary announcement published on 27 November 2001, The Janus
Corporation (Pty) Ltd is authorised to announce that progress has been made
as follows:
Withdrawal of litigation
The application to the High Court for the winding-up of Rareco has been
withdrawn by the minority shareholder who brought the application. The
effect of this withdrawal is that Rareco may now proceed with its plans to
develop its rare earth project in the Western Cape without this legal
impediment. In addition, the end to the litigation means that Rareco has
fulfilled one of the conditions for the R16 million development capital loan
approved by the Industrial Development Corporation of South Africa Limited.
General issue of shares for cash
The board of directors also wishes to inform shareholders that it has
completed a general issue of shares for cash whereby 3 000 000 ordinary
shares have been placed with a number of independent public shareholders at
a price of 36 cents each. The price for the issue was determined by the
directors on 10 December 2001 based on the weighted average price of 31,2
cents for the period from 1 July 2001 to that date. This issue increases the
number of shares in issue from 30 000 000 shares to 33 000 000 shares. The
capital raised, amounting of R1 080 000, will provide Rareco with working
capital until a rights offer is undertaken in the next few months. The cash
issue was made in terms of the general authority to issue shares for cash
granted to the board by shareholders at the annual general meeting held on
14 December 2001.
The financial effects of the issue on the earnings per share and net asset
value of Rareco based on the audited balance sheet of Rareco as at the 30
June 2001 year-end and for purposes of the earnings per share calculation
assuming that interest of 10% per annum before and after tax was earned for
the year from 1 July 2000, are as follows:
Before Pro Increase/
forma (Decrease
After )
Net asset value per 40,3 39,9 (1)%
share (cents)
Earnings per share 11,0 11,4 3,3%
(cents)
Headline earnings per 0,0 0,3 n/a
share (cents)
Future developments
The board of directors will be proceeding with plans to conclude additional
financing arrangements in preparation for an intended rights offer to
shareholders which is anticipated to be concluded by mid-year. An
announcement in this regard will be made in due course.
Withdrawal of cautionary announcement
Following the finalisation of the litigation matter and the conclusion of
the issue of shares for cash, shareholders are no longer required to
exercise caution in dealing in their Rareco shares.
Somerset West
1 February 2002
Corporate adviser and sponsor
The Janus Corporation
Profile Group (Pty) Ltd. has taken care in preparing all information on this website, but does not accept any liability for errors or out-of-date information.
