| Mon 28 Jun 2004, 9:39 | | DRD CLOSES OUT LAST REMAINING HEDGE |
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DURBAN ROODEPOORT DEEP LIMITED - DRD CLOSES OUT LAST REMAINING HEDGE
Durban Roodepoort Deep, Limited
(Incorporated in the Republic of South Africa)
(Registration number 1895/000926/06)
JSE Share code: DUR
ISIN: ZAE000015079
ARBN number: 086 277 616
NASDAQ Trading Symbol: DROOY
(`DRD`)
DRD CLOSES OUT LAST REMAINING HEDGE
DRD is pleased to announce that it will be closing out its only remaining hedge
contract in line with its policy of not hedging gold production.
The hedge is a `gold for electricity` contract with Eskom, the South African
power utility, and was largely closed out in early 2004. The remaining 135 000
ounces of gold hedged under the contract covers the period January 2005 to
September 2005 and DRD expects that it will be closed out by next week.
DRD Chief Executive Officer Ian Murray said: `We have been keen to close out
this remaining hedge contract and the current low Rand gold price has presented
an ideal opportunity to achieve this. DRD will now provide shareholders with
even more direct exposure to the gold price.`
To fund the closing out of the Eskom hedge, DRD has agreed a R100 million
(US$15.8 million/A$22.6 million) short-term loan facility with Investec Bank
Limited (`Investec`), a South African bank. The loan is based on commercial
terms and conditions and is repayable at DRD`s election, either in cash, in DRD
shares or a combination of both.
The number of shares that could be issued to Investec under this loan is
dependent on the average price of DRD shares as traded on the JSE Securities
Exchange South Africa (`JSE`) for the ten trading days prior to the dates of
repayment. At the closing share price on the JSE on 24 June 2004 of R16,
approximately 6.25 million shares may be issued or 2.6% of the enlarged capital,
assuming the full facility is drawn down.
DRD estimates the cost of closing out the hedge will be around R60 million
(U$9.5 million/A$13.6 million).
The balance of R40 million (U$6.3 million/A$9.0 million) will be available for
any required injection of funds into Emperor Mines Limited (`Emperor`) if and
when that company comes under DRD`s full ownership. The funds will not be used
for the acquisition of Emperor shares.
DRD has previously indicated that, in its view, Emperor will require additional
funding to complete its Phase II capital expansion plan and possibly for other
plant upgrades, including those required to release the significant build up of
gold in circuit.
Any injection of funds into Emperor will depend in part on the level of
acceptances under the current takeover offer. DRD has received a recommendation
by a majority of the independent directors of the Emperor Mines Limited board
that shareholders accept DRD`s final, revised offer of five DRD shares for every
22 Emperor shares it does not already own. DRD currently has an interest in 26%
of Emperor. If the offer is unsuccessful, DRD may choose not to further draw
down the loan facility or, alternatively, will use the funds for general
corporate purposes.
DRD is offering to acquire all of the shares in Emperor by way of a takeover
offer. The outcome of the takeover is not yet known, as the remaining 50.1%
minimum acceptance requirement has not yet been satisfied. The offer is
scheduled to close on 14 July 2004 unless extended.
Johannesburg
28 June 2004
U.S. DISCLOSURES
The DRD shares mentioned in this release and offered in the take-over offer have
not been registered under the U.S. Securities Act and may not be offered or sold
within the United States or to U.S. persons unless they are registered under the
U.S. Securities Act or an exemption from the registration requirements of the
U.S. Securities Act is available.
The offer described in DRD`s Bidder`s Statement dispatched on 13 April 2004 is
made for the securities of an Australian company. The offer is subject to
disclosure requirements in Australia that are different from those of the United
States. Certain financial statements included in the Bidder`s Statement have
been prepared in accordance with South African, Australian and/or International
Accounting Standards that may not be comparable to the financial statements of
United States companies. It may be difficult for Emperor`s shareholders to
enforce their rights and any claim they may have arising under the U.S. federal
securities laws, since DRD is located in South Africa, and all of its officers
and directors are residents of countries other than the United States.
Emperor`s shareholders may not be able to sue DRD or its officers or directors
in a non-U.S. court for violations of U.S. securities laws. It may be difficult
to compel DRD and its affiliates to subject themselves to a U.S. court`s
judgment. You should be aware that DRD may purchase securities otherwise than
under the offer in DRD`s Bidder`s Statement, such as in the open market or
privately negotiated transactions to the extent permitted under Australian law.
Queries
South Africa
Investor and Media Relations
Ilja Graulich,
Durban Roodepoort Deep, Limited
+27 11 381 7826 (office)
+27 83 604 0820 (mobile)
James Duncan,
Russell & Associates
+27 11 880 3924 (office)
+27 82 892 8052 (mobile)
Australasia
Investor and Media Relations
Paul Downie, Porter Novelli
+61 893 861 233 (office)
+61 414 947 129 (mobile)
United Kingdom/Europe
Investor and Media Relations
Phil Dexter, St James`s Corporate
+44 20 7499 3916 (office)
+44 779 863 4398
North America
Investor Relations
Susan Borinelli,
Breakstone & Ruth International
+1 646-536-7018 (office)
+1 917-570-8421 (mobile)
Media Relations
Jessica Anderson,
Breakstone & Ruth International
+1 646-536-7002 (office)
+1 347-423-5859 (mobile)
Date: 28/06/2004 09:30:13 AM
Produced by the JSE SENS Department
