| Wed 11 Aug 2004, 15:29 | | Combination of Gold Fields' International Assets |
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Gold Fields - Combination of Gold Fields` International Assets with AIMGOLD to
create a major new gold producer
Gold Fields Limited
Incorporated in the Republic of South Africa
Registration number 1968/004880/06
Share code: GFI
Issuer code: GOGOF
ISIN: ZAE000018123
COMBINATION OF GOLD FIELDS` INTERNATIONAL ASSETS WITH IAMGOLD TO CREATE A MAJOR
NEW GOLD PRODUCER
Toronto, Canada and Johannesburg, South Africa, August 11, 2004 - Gold Fields
Limited (JSE, NYSE:GFI) (`Gold Fields`) and IAMGOLD Corporation, (TSX:IMG;
AMEX:IAG) (`IAMGOLD`) today announced that they have agreed to combine the
international assets of Gold Fields located outside the Southern African
Development Community (`SADC`) with IAMGOLD in exchange for Gold Fields
receiving IAMGOLD shares, to create one of the world`s largest gold producers.
Following the completion of the transaction, Gold Fields will own approximately
70 percent of the fully diluted equity of the enlarged company. Existing IAMGOLD
shareholders will own the remaining 30 percent of the company, and will also
receive a special cash dividend of Cdn$0,50 per share at completion of the
transaction. The enlarged company will become the fourth largest North American
gold producer and the seventh largest gold producer worldwide.
Following completion of the transaction, IAMGOLD will be renamed `GOLD FIELDS
INTERNATIONAL LIMITED` (`GOLD FIELDS INTERNATIONAL`) and will become an
international growth vehicle for Gold Fields and IAMGOLD shareholders outside of
the SADC region.
Conference Call / Presentation / Webcast
A joint and simultaneous market presentation and webcast by Gold Fields and
IAMGOLD executives is scheduled for Wednesday, August 11, 2004 at 17.00 pm South
Africa time, 16.00 pm London time and 11.00 am Toronto Time.
For those who can attend the conference call and market presentation in person,
the Johannesburg presentation will be at the Sandton Convention Centre,
Committee Room 2, Level 4, Maude Street, Sandown and the Toronto presentation at
the Royal York Hotel, Territories Room, 100 Front Street West, Toronto.
The conference call and market presentation will be webcast live onto the Gold
Fields and IAMGOLD web pages, at www.goldfields.co.za or www.iamgold.com.
In South Africa the market presentation will be broadcast live on Summit TV.
Key attributes of GOLD FIELDS INTERNATIONAL
* Anticipated production of approximately 2 million ounces in 2005, projected
to increase to approximately 2.4 million gold equivalent ounces in 2007
* Proven and probable attributable gold reserves of 14.6 million ounces,
measured and indicated resources (including reserves) of 25.9 million
ounces, and additional inferred resources of 9.9 million ounces
* Strong pipeline of near-term development projects and a portfolio of
attractive advanced-stage exploration projects
* Unhedged production and reserves
* Geographically diversified asset base including operations and projects in
Australia, West Africa, Europe and the Americas
* Strong balance sheet with approximately US$350 million in cash and bullion,
together with a further US$95 million in realized currency gains to be
received in cash over the next 18 months; anticipated operating cash flow
in financial year 2005 of approximately US$265 million, assuming a gold
price of US$400 per ounce
* Experienced management team drawn from Gold Fields and IAMGOLD with
established international mine development and operating track records
Listings on the Toronto Stock Exchange and the American Stock Exchange,
with good liquidity and access to capital markets
Chris Thompson, Chairman of Gold Fields, commented, `We are tremendously excited
by the creation of this enlarged company which combines our non-SADC assets with
IAMGOLD`s quality asset base. The transaction will position GOLD FIELDS
INTERNATIONAL as a competitive global industry player with the ability to pursue
growth organically at its existing operations, to develop its impressive
portfolio of projects in the near term, and to advance its exploration pipeline.
With its high quality assets, cash reserves, experienced management, critical
mass and direct access to international capital markets, GOLD FIELDS
INTERNATIONAL will be in a strong position to take advantage of any other
opportunities as they emerge.`
Joseph Conway, President and CEO of IAMGOLD said, `Over the previous weeks, and
in response to the unsolicited offer from Golden Star Resources, management has
worked closely with the special committee of the Board and RBC Capital Markets
to identify the best opportunity to maximize value for IAMGOLD shareholders.
This transaction is clearly accretive to IAMGOLD shareholders along a number of
valuation metrics. Furthermore, it delivers on IAMGOLD`s previously stated
strategic objectives of growing its share of gold production and diversifying
its operating base. The board and management of IAMGOLD have concluded that this
combination is superior to any of the other proposals received or currently on
the table and should result in the creation of sustainable value for
shareholders. In addition, the board of IAMGOLD has received the opinion of RBC
Capital Markets that, as at the date hereof, the consideration under the
transaction is fair from a financial point of view to IAMGOLD.`
Ian Cockerill, Chief Executive Officer of Gold Fields, added, `GOLD FIELDS
INTERNATIONAL will now become the vehicle through which Gold Fields will pursue
its well established international growth strategy outside of the SADC region.
Through our shareholding in GOLD FIELDS INTERNATIONAL, shareholders of Gold
Fields will continue to benefit from further value creation through
international growth, whilst Gold Fields investment in North American listed
GOLD FIELDS INTERNATIONAL will better reflect the true value of our
international assets outside of the SADC region. The management of Gold Fields
remains focused on the continued release of value from our South African and
SADC region assets and on maintaining our position as a preeminent South African
gold producer.`
Transaction Structure
IAMGOLD will purchase the assets of Gold Fields located outside of the SADC
region by the issuance of 351,690,218 ordinary shares, which have a market value
of approximately US$2,1 billion based on IAMGOLD`s volume weighted share price
over the 20 trading days to August 10, 2004. The issue of these shares will
result in Gold Fields holding approximately 70 percent of the enlarged company
with the remaining 30 percent held by IAMGOLD shareholders. The number of shares
to be issued will be subject to adjustment based on the total cash contributed
by Gold Fields to the ongoing capital expenditure programs of the assets to be
acquired by IAMGOLD from and after June 24, 2004 through closing. This
adjustment will be made based on the 20-day average trading price of IAMGOLD
shares prior to closing and is capped at US$50 million. The transaction is
subject to the approval of the majority of shareholders of both Gold Fields and
IAMGOLD, as well as regulatory approvals and third party consents. An
information circular is expected to be delivered to shareholders in the coming
weeks upon which a date for shareholder meetings will be announced. The
transaction is anticipated to close prior to the end of this calendar year.
Special dividend
At completion, IAMGOLD shareholders (other than Gold Fields) will receive a
special cash dividend of Cdn$0,50 per share. The aggregate value of this payment
will be approximately C$75 million (US$57 million).
Exchange control clearances obtained
Gold Fields has received approval for the transaction from the South African
Reserve Bank (`SARB`) on the basis that:
* At all times Gold Fields maintains a shareholding of at least 50,1 percent
in GOLD FIELDS INTERNATIONAL
* Gold Fields, in order to maintain a shareholding of at least 50,1 percent
in GOLD FIELDS INTERNATIONAL, will be permitted, subject to the approval of
the SARB on a case-by-case basis, to follow its rights in any equity
capital market fund raising by GOLD FIELDS INTERNATIONAL by using funds
sourced from within South Africa, provided that:
- funds sourced from within South Africa are to be applied towards
capital expenditure on a specific project or towards the funding of
any corporate acquisition of GOLD FIELDS INTERNATIONAL;
- the requirements as set out below are complied with; and
- the financing of the following of such rights must be done within the
foreign direct investment limits or other exchange control policy
parameters prevailing at such time;
* GOLD FIELDS INTERNATIONAL will be permitted to pursue subsequent corporate
acquisitions or projects without seeking prior approval from the SARB on
the following terms:
- the acquisition or project should be in the same line of business that
IAMGOLD is currently pursuing - i.e. gold mining as well as platinum
group metals. However, in some cases copper and other base metals
could be by-product revenue to the main process of mining for gold and
platinum group metals;
- any acquisition or project that is pursued would also be subject to
GOLD FIELDS INTERNATIONAL maintaining an ownership interest of at
least 50,1 percent therein;
- any financing arrangements relating to such acquisitions must be
without recourse to South Africa;
- any acquisition or project pursued by GOLD FIELDS INTERNATIONAL should
result in a benefit to South Africa over the longer term. Over and
above the normal benefits in terms of added value through such
acquisitions or projects, Gold Fields has agreed to use its reasonable
commercial endeavours to source technical skills from South Africa in
developing any acquisitions, consider procurement opportunities from
South Africa and investigate the possibility of providing employment
opportunities in areas where specific expertise is required and is
available; and
- Gold Fields is required to report back to the SARB after any
acquisition, giving full details of the acquisition and the financing
mechanisms and details of the specific benefits accruing to South
Africa.
The SARB has agreed to allow the annual earnings of GOLD FIELDS INTERNATIONAL to
be retained offshore to the extent required for working capital, funds for
expansion programmes and projects, corporate acquisitions and debt servicing. In
this regard Gold Fields is required to report annually to SARB on GOLD FIELDS
INTERNATIONAL`s requirements.
Overview of Gold Fields International
GOLD FIELDS INTERNATIONAL will have interests in six operating mines; four in
West Africa (Tarkwa and Damang in Ghana, Sadiola and Yatela in Mali) and two in
Australia (St. Ives and Agnew). In addition, GOLD FIELDS INTERNATIONAL will have
two near-term greenfield development projects located in Finland (Arctic
Platinum) and, subject to completion of Gold Fields` acquisition thereof, Peru
(Cerro Corona), along with various royalty interests and an attractive portfolio
of advanced-stage exploration projects in Latin America, Australia, China and
Africa.
Management and Board of Gold Fields International
Subject to formal process, it is anticipated that Gordon R. Parker will resign
from the current Gold Fields board to become Chairman of GOLD FIELDS
INTERNATIONAL. Mr. Parker is the former Chairman and CEO of Newmont Mining.
Similarly Chris Thompson will resign from his post as Chairman of Gold Fields to
become President and CEO of the new company. William Pugliese, current Chairman
of IAMGOLD, will become Deputy Chairman.
Alan Wright, currently Deputy Chairman of Gold Fields, is anticipated to succeed
Mr. Thompson as Chairman of Gold Fields. Other key appointments to the
management of GOLD FIELDS INTERNATIONAL will include John Munro as Chief
Operating Officer, Grant Edey from IAMGOLD as head of the finance function and
Craig Nelsen will head Exploration and Corporate Development.
The number of directors of the new company will be limited to ten with three
nominees from the IAMGOLD board and seven to come from Gold Fields. The list
will include some prominent Canadian nationals.
The Gold Fields` nominees will include Ian Cockerill and Nick Holland, currently
CEO and CFO, respectively, of Gold Fields. GOLD FIELDS INTERNATIONAL will retain
the current IAMGOLD listings on the Toronto and American Stock Exchanges.
Conference call participants can access and follow the slides to be used for the
conference call from the Gold Fields and IAMGOLD web pages.
Gold Fields web site: www.goldfields.co.za
IAMGOLD website: www.iamgold.com
Cautionary Statements
Safe Harbor Statement under the United States Private Securities Litigation
Reform Act of 1995 Certain statements in this document constitute `forward
looking statements` within the meaning of Section 27A of the US Securities Act
of 1933 and Section 21E of the US Securities Exchange Act of 1934. Such forward-
looking statements, including but not limited to those with respect to the price
of gold, the timing and amount of estimated future production, costs of
production, estimated operating results, reserve determination and reserve
conversion rates, involve known and unknown risks, uncertainties and other
factors which may cause the actual results, performance or achievement of
IAMGOLD or Gold Fields to be materially different from any future results,
performance or achievements expressed or implied by such forward-looking
statements. Such risks, uncertainties and other factors include, among others,
risks related to the integration of acquisitions, increased production costs,
risks related to international operations, risks related to joint venture
operations, the actual results of current exploration activities, actual results
of current reclamation activities, conclusions of economic evaluations, changes
in project parameters as plans continue to be refined, future prices of gold,
currency devaluations, labour disruptions; changes in government regulations,
particularly environmental regulations, changes in exchange rates, inflation and
other macro-economic factors, as well as those factors discussed in the section
entitled `Risk Factors` in the Form 40-F for IAMGOLD and the Form 20-F for Gold
Fields as on file with the U.S. Securities and Exchange Commission in
Washington, D.C. Although IAMGOLD and Gold Fields have attempted to identify
important factors that could cause actual results to differ materially, there
may be other factors that cause results not to be as anticipated, estimated or
intended. There can be no assurance that such statements will prove to be
accurate as actual results and future events could differ materially from those
anticipated in such statements. Accordingly, readers should not place undue
reliance on forward-looking statements. These forward-looking statements speak
only as of the date of this document.
Investors are advised that National Policy 43-101 of the Canadian Securities
Administrators requires that each category of mineral reserves and mineral
resources be reported separately. Investors and securities holders should refer
to the annual information form of IAMGOLD, for the year ended December 31, 2003,
and material change reports filed by IAMGOLD since January 1, 2003 available at
www.sedar.com, for this detailed information with respect to IAMGOLD , which is
subject to the qualifications and notes set forth therein. United States
investors are advised that while the terms `measured` and `indicated` resources
are recognized and required by Canadian regulations, the SEC does not recognize
them. Investors are cautioned not to assume that all or any part of mineral
deposits in these categories will ever be converted into reserves.
As required by the JSE Securities Exchange in South Africa, a Cautionary
Announcement has been issued by Gold Fields via SENS and will be reproduced in
the South African Press. A slide presentation summarizing the transaction will
be made available on the Gold Fields and IAMGOLD web sites directly before the
conference call. The full text of Gold Fields` Cautionary Announcement can also
be found on its web site: www.goldfields.co.za
Enquiries
Gold Fields: IAMGOLD:
Willie Jacobsz Tom Atkins
+27 11 644-2460 +1 416 360 4710
toll-free +1 888 IMG 9999
Cheryl Martin
+1 303 796-8683
Additional Information for Editors
IAMGOLD Corporation
IAMGOLD is a leading gold mining exploration and development company. Its
principal assets, located in West Africa, include a 38 percent stake in the
Sadiola Gold Mine, a 40 percent stake in the Yatela Gold Mine, both located in
Mali, and an 18.9 percent stake in the Tarkwa/Damang complex in Ghana. The
combined annual expected gold production from these properties for 2004 is
expected to be approximately 420,000 ounces. IAMGOLD also has a diverse royalty
portfolio, which includes a 1 percent royalty interest in the Diavik Diamond
Project in Canada. IAMGOLD is listed on both the Toronto Stock Exchange and the
American Stock Exchange.
Gold Fields Limited
Gold Fields is one of the world`s largest unhedged gold companies with annual
gold production of approximately 4.2 million ounces for the financial year ended
30 June 2004, with proven and probable gold reserves of 81 million ounces and
mineral resources of 186 million ounces as at 30 June 2003. Gold Fields has
operations in South Africa, Australia and Ghana (West Africa) and has an
exciting growth project pipeline. This includes a geographically diverse
exploration portfolio as well as the Arctic Platinum Project, an advanced stage
PGM project in Northern Finland and the Cerro Corona Copper/Gold Project in Peru
and subject to completion of this transaction. Gold Fields has its primary
listing on the JSE Securities Exchange South Africa with secondary listings on
the London Stock Exchange, Euronext Paris and the SWX Swiss exchanges. The
company`s American Depositary shares are listed on the New York Stock Exchange,
where they trade under the symbol `GFI` and its International Depository Shares
are listed on Euronext Brussels.
Southern African Development Community
The Southern African Development Community (`SADC`) includes 14 member states,
namely Angola, Botswana, Democratic Republic of Congo, Lesotho, Malawi,
Mauritius, Mozambique, Namibia, Seychelles, South Africa, Swaziland, United
Republic of Tanzania, Zambia and Zimbabwe.
Date: 11/08/2004 02:45:40 PM Supplied
Produced by the JSE SENS Department
