| Tue 12 Oct 2004, 8:42 | | Introduction of a strategic equity partner |
|
Zambia Copper Investments Limited - Further announcement in respect of the
introduction of a strategic equity partner for Konkola Copper Mines plc
Zambia Copper Investments Limited
(Registered in Bermuda)
JSE code: ZCI ISIN: BMG988431240
LSE code: ZCI Euronext code: BMG988431240
(`ZCI` or `the company`)
Further announcement in respect of the introduction of a
strategic equity partner for Konkola Copper Mines plc
1. Introduction
Shareholders are referred to the detailed terms announcement published on 20
August 2004 relating to the purchase by Vedanta Resources plc (`Vedanta`) of
a 51% equity stake in Konkola Copper Mines plc (`KCM`) (`the Vedanta
investment`).
2. Shareholders` meeting
A general meeting of ZCI ordinary shareholders to consider the Vedanta
investment will be held at 10:00 on Tuesday 26 October 2004, at Hermes
Amphitheatre, Paris Expo Coeur Defense, 110 Esplanade du General de Gaulle,
92032 Paris La Defence Cedex, France.
3. Important dates and times
2004
Last day to lodge form of proxy for general meeting
by 10:00 on Monday 25 October
General meeting of shareholders to be held at 10:00 on Tuesday 26 October
Results announcement published on Stock Exchange
News Service of the JSE Securities Exchange
South Africa (`JSE`), London Stock Exchange plc (`LSE`) and
Paris Euronext on Tuesday 26 October
Results announcement published in the South African
press on Wednesday 27 October
Notes:
1: These dates and times are subject to change. Any changes will be
published on SENS, LSE and Paris Euronext and in the South African press.
2: These times are South African and Central European times.
4. Pro forma financial effects of the Vedanta investment
The pro forma financial effects of the transaction are set out below and
are based on the published unaudited interim results for the six month period
ended 30 June 2004. The pro forma financial effects are calculated taking into
account that, post the Vedanta investment, KCM will no longer be considered a
subsidiary company of ZCI for accounting purposes. Therefore, ZCI will no
longer consolidate KCM and will treat it as an associate company for
accounting purposes.
The pro forma financial effects set out below do not necessarily
represent or indicate sustainable earnings or future profits of ZCI.
Accordingly, the pro forma financial effects set out below have been prepared
for illustrative purposes only.
Actual Pro forma
Before After the Increase/
the Vedanta Vedanta Increase/ (Decrease)
Notes investment investment (Decrease) (%)
Earnings per
ordinary share
(cents) 3 24,161 19,844 (4,32) (17,88)
Headline earnings
per ordinary
share (cents) 24,161 19,844 (4,32) (17,88)
Tangible net asset
value (`NAV`) per
ordinary share
(cents) 5 57,831 51,312 (6,52) (11,27)
Actual number of
ordinary shares in
issue (`000) 6 126 197 126 197 - -
Weighted average
number of ordinary
shares in issue
(`000) 6 126 197 126 197 - -
Notes:
The pro forma financial effects of the Vedanta investment set out above are
based on the following assumptions:
1. the earnings, headline earnings and tangible NAV per ordinary share
reflected in the `Before the Vedanta investment` column were extracted from
the company`s unaudited results for the six months ended 30 June 2004;
2. the effect on tangible NAV per ordinary share reflected in the `After
the Vedanta investment` column assumes that the transaction was effective on
30 June 2004;
3. earnings per ordinary share are equal to fully diluted earnings per
ordinary share;
4. the effect on earnings and headline earnings per ordinary share
reflected in the `After the Vedanta investment` column assumes that the
transaction was effective on 1 January 2004;
5. there is no difference in the value for NAV per ordinary share and
tangible NAV per ordinary share as there are no intangible assets on the ZCI
balance sheet;
6. the number of ordinary shares is indicative only and is based on the
ordinary shares in issue at 1 January 2004;
7. the deferred consideration, payable by Vedanta, to be received from 2005
to 2008 was discounted to a net present value at 30 June 2004 and 1 January
2004 using a discount rate of 2,46% per annum;
8. the deferred consideration was amortised on a straight-line basis over
the period from the effective date to December 2008;
9. ZCI had a 28,4% share in the KCM value increase resulting from the $25
million cash injection into KCM;
10. due to its contingent nature the shortfall funding commitment, provided
by Vedanta pursuant to the terms of the Vedanta investment, has not been
included in the above calculations; and
11. the financial effects have been prepared on the basis of the non-
consolidation of the KCM Employee Share Ownership Trust (`ESOT`). The
directors of ZCI are of the opinion that the ESOT should not be consolidated
as it does not constitute a trust or scheme in terms of, and therefore subject
to, the provisions of Schedule 14 of the JSE Listings Requirements.
5. Documentation
A circular setting out the terms of the Vedanta investment and
containing a notice of a general meeting of ZCI shareholders was posted to ZCI
shareholders on Monday 11 October 2004.
By order of the board
Bermuda
11 October 2004
Sponsor and independent financial advisor
Rand Merchant Bank
A division of FirstRand Bank Limited
Corporate Finance
South African legal advisor
Webber Wentzel Bowens
International legal advisor
Maitland
Maitland & Co, London
Reporting accountants and auditors
Deloitte
Deloitte & Touche Chartered Accountants (SA)
Registered Accountants and Auditors
Date: 12/10/2004 08:36:27 AM
Produced by the JSE SENS Department
