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Schamin - Announcement Relating To A Black Economic Empowerment (`BEE`)
Transaction
Scharrig Mining Limited
Incorporated in the Republic of South Africa
Registration number 1992/001973/06
Share code:SCN ISIN Code:ZAE000006474
(`Schamin` or `the Company`)
ANNOUNCEMENT RELATING TO A BLACK ECONOMIC EMPOWERMENT (`BEE`) TRANSACTION
Introduction
Shareholders are advised that a BEE consortium led by Mr Dines Gihwala and Mr
Richard Jonah (`the BEE consortium`) has acquired 22.2 million ordinary shares
(`the shares`) in the Company for a total purchase consideration of R49.95
million in cash (`the transaction`). Accordingly, the BEE consortium`s
shareholding in the Company pursuant to the transaction is approximately 17.3%
of the Company`s issued share capital.
The shares were acquired from certain members of the Scharrighuisen family (`the
sellers`) at a price of 225 cents per share (`the price`). The price was based
on the ruling price the shares were trading at on the JSE Securities Exchange
South Africa (`the JSE`) when negotiations between the BEE consortium and the
sellers commenced.
The BEE consortium has also been granted an option to acquire a further 34.38
million shares in the Company from companies and trusts associated with Mr
Theunis Scharrighuisen (`the option`). The option can be exercised in whole or
in part by the BEE consortium on or before 22 July 2005 at a price per share of
225 cents plus 0.043 cent per day from 22 April 2005 until the date the option
is exercised (`option price`). Should the option be exercised and result in the
BEE consortium acquiring 35% or more of the shares in Schamin, an offer to
minorities in terms of the SRP Code on Takeovers and Mergers will be made.
Should the option be exercised in full, Schamin could become a black-controlled
mining services company listed on the JSE.
Background to the Company and rationale for the transaction
Schamin is listed on the Main Board of the JSE. Schamin is one of the major
providers of outsourced opencast mining and mine rehabilitation services to the
South African coal-mining industry. Its principal clients include BHP Billiton
Limited (`BHP Billiton`), Ingwe Collieries Limited (a member of the BHP Billiton
group) and Eyesizwe Coal Limited.
Key management, including the managing director Mr Casper Scharrighuisen, have
signed service agreements with the Company for periods ranging from 3 to 5
years.
The BEE consortium has been introduced as a strategic shareholder in Schamin in
cognisance of the relevant empowerment charters influencing the Company. The
BEE consortium through its networks and knowledge will also contribute to
ensuring that the Company complies with other BEE requirements specified in such
charters.
The BEE consortium is confident that the Company will benefit from the extensive
mining contacts and experience of Mr Dines Gihwala, Mr Richard Jonah and Mr
Richard Jonah`s family. Opportunities identified include the sourcing of new
contracts and the diversification of the Company`s earnings base.
Mr Dines Gihwala and Mr Richard Jonah will in due course be appointed to the
board of directors of Schamin.
Financial effects of the transaction
Neither the transaction nor the exercising of the option will have an effect on
Schamin`s net asset value or earnings per share.
Boksburg
22 April 2005
Sponsor
Sasfin Corporate Finance - A division of Sasfin Bank Limited
Legal advisors to the BEE Consortium
Hofmeyr Herbstein & Gihwala Inc
Date: 22/04/2005 04:30:10 PM
Produced by the JSE SENS Department
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