| Tue 23 Aug 2005, 11:38 | | Aflease proposes to acquire a controlling sharehol |
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Aflease proposes to acquire a controlling shareholding in Sub Nigel
Aflease Gold and Uranium Resources Limited
(Formerly The Afrikander Lease Limited)
(Incorporated in the Republic of South Africa)
AFL (JSE) AFLUY (NASDAQ)
(Registration number 1921/006955/06)
ISIN: ZAE000061461 & JSE Share Code: AFL
Aflease Gold and Uranium proposes to acquire a controlling shareholding in Sub
Nigel
Aflease announced today that it wishes to acquire a majority shareholding in Sub
Nigel Gold Mining Company Ltd. through the transfer of Aflease`s wholly-owned
New Kleinfontein Mining Company (NKMC) subsidiary to Sub Nigel in exchange for
the issuance of ordinary shares in Sub Nigel (the Transaction).
If accepted, the Transaction would result in Aflease acquiring control and
owning 80% of Sub Nigel pursuant to the implementation of the Transaction.
Current Sub Nigel shareholders would own the 20% balance.
The new Sub Nigel - to be renamed Aflease Gold - would hold Aflease`s East Rand
gold assets, including the high quality Modder East project, which is housed in
NKMC, as well as Sub Nigel`s East Rand and Free State gold assets. Aflease Gold
would continue to be listed on the JSE Ltd.
The Transaction exchange ratios were based on an independent assessment of
reserves and resources of both Aflease and Sub Nigel, which was conducted by
Steffen, Robertson and Kirsten (SRK). Based on recent Sub Nigel share prices,
the merged entity would have an estimated market capitalisation of R416 million.
The successful implementation of the Transaction is subject to approval by the
Sub Nigel board of directors, as well as the Aflease board, and to acceptance by
a majority of Sub Nigel`s shareholders.
The offer is conditional on Sub Nigel`s shareholders waiving their rights to an
offer to minorities in terms of the Securities Regulation Panel (SRP) code. The
three largest shareholders of Sub Nigel -Gold Fields Ltd., Trinity Asset
Management and Mr. Les Holmes - have agreed to support the Transaction.
The Transaction is also subject to approvals from the regulatory authorities who
include the Competition Authorities, the JSE, the SRP and the South African
Reserve Bank.
In commenting on today`s Transaction, Neal Froneman, Aflease CE, said: `This
Transaction starts the consolidation of the East Rand goldfields and creates a
gold vehicle with high-quality assets. The Transaction will also achieve our
recently announced objective of separately listing our pure gold assets. The
combination of our gold assets is also in line with our stated strategy of
operating in a shallow, low cost and low technical risk mining environment. We
look forward to working with Sub Nigel and its shareholders in growing the value
of our combined gold assets.`
Adrian Reynolds, CE of Sub Nigel, said: `Our board will now consider the
proposal, and will take independent advice. I welcome the proposa;, and believe
there are significant synergies, which could be realized through the proposed
merger. The proposal will also help to unlock the great potential of Sub
Nigel, notably by enhancing our access to capital.`
The Weltevreden Gold mine has not been included in the merger with Sub Nigel as
Aflease is in the process of determining the uranium potential of the
Weltevreden gold mine. Should this high quality gold mine not have any
significant uranium potential it will at a later date, subject to the
appropriate approvals, become part of the Sub Nigel asset base.
If the Transaction is accepted, Aflease`s 80% stake in Sub Nigel would, upon
completion of Aflease`s previously announced planned merger with Southern Cross
Resources Inc (Southern Cross), form part of the assets of sxr URANIUM ONE. The
Transaction is accordingly subject to formal acceptance by Southern Cross, which
has already voiced its provisional support.
`Just as we are planning to merge with Southern Cross to create a focused
uranium business, we now intend to pursue a majority share in Sub Nigel in order
to list our gold assets. We see this as the most efficient and cost- effective
way of bringing our pure gold assets onto the Johannesburg bourse in a separate
listing,` said Froneman. `We see our interest in Sub Nigel as a strategic
stake, and plan on retaining it, to give sxr URANIUM ONE shareholders the
continuing benefit of exposure to gold,` he said.
The Sub Nigel Transaction is expected to be completed after the formation of sxr
URANIUM ONE, and is not expected to affect the timing of the sxr URANIUM ONE
Transaction.
This press release does not constitute an offer of securities for sale in the
United States. No securities may be offered or sold in the United States absent
registration under the U.S. Securities Act of 1933, as amended, or an exemption
from registration thereunder. Any public offering will only be made by means of
a prospectus that may be obtained from issuer and that will contain detailed
information about the company and management, as well as financial statements.
Contacts:
Neal Froneman +27 83 628 0226
Adrian Reynolds +27 83 306 4707
John Fraser + 27 82 331 7330
Carol Smith + 27 82 338 2228
23 August 2005
Date: 23/08/2005 11:09:05 AM
Produced by the JSE SENS Department
