| Tue 12 Dec 2006, 10:00 | | NBL - Jubilee increases its equity holding in Tjat |
|
JBL
JUJLP
NBL - Jubilee increases its equity holding in Tjate to 48%
JUBILEEPLATINUM PLC
(Incorporated in England and Wales)
(Registration number4459850)
Share code on JSE: JBL & ISIN: GB0031852162
Share code on AIM: JLP
("Jubilee" or "the Company")
Jubilee increases its equity holding in Tjate Platinum Corporation (Proprietary)
Limited to 48%
1. INTRODUCTION
Jubilee is pleased to announce that it has entered into a Sale of Shares
Agreement ("Agreement") with New Plats (Tjate) (Proprietary) Limited ("New
Plats") to acquire its shareholding in Tjate Platinum Corporation (Proprietary)
Limited ("Tjate") ("the Acquisition") on the following terms:
* Jubilee will purchase an additional 13% stake in Tjate for R65 million by
way of an issuance of approximately 7,455,642 Jubilee shares, so as to
increase Jubilee`s effective interest in Tjate to 48%; and
* Jubilee will have an option to purchase a further 15% in Tjate for R75
million by way of an issuance of Jubilee shares pending satisfaction of
certain conditions precedent.
2. NATURE OF ACQUISITION
In December 2000, Anglo American plc released the three farms that comprise the
Tjate project area from its joint venture with the then Lebowa State. The
Department of Minerals and Energy ("DME") sought historically disadvantaged
South Africans to apply for the prospecting rights. Two separate applicants
were given the rights on condition they formed a joint venture, the result was
Tjate. In December 2004, Jubilee purchased a 35% interest in the Tjate project
in the eastern Bushveld for R49 million, of which R35 million purchased a direct
25% interest in the holding company Tjate. A further R14 million was committed
to a convertible note to earn-in a further 10% interest, part funding towards a
full feasibility study.
Tjate, which has a converted new order prospecting right, comprises of three
contiguous farms, totalling 5,143 hectares in the eastern Bushveld: namely
Dsjate, Fernkloof and Quartz Hill. The farms are down dip of Impala Platinum
Holdings Limited`s operating Marula Platinum Group Element ("PGE") mine and
Anglo Platinum plc`s developing Twickenham PGE project. Jubilee has recently
completed the first phase drilling of seven boreholes on the Dsjate farm. All of
the boreholes, as previously reported, intersected at targeted depth the
Merensky reef and, where drilled deeper, the UG2 reef (A chromite reef in the
Bushveld sequence usually containing economic values of PGE`s), which are the
two main PGE-bearing horizons in the Bushveld.
3. RATIONALE FOR THE ACQUISITION
In taking this step, Jubilee has advanced its investment position in the Tjate
project, which is one of South Africa`s largest undeveloped blocks of PGEs
currently under exploration, to 48%. The directors of Jubilee have been
satisfied with the drilling results at Tjate to date and believe that Tjate is
advancing to a pre feasibility phase. At this stage Tjate is considered to
underpin Jubilee as an exploration company.
4. SALIENT TERMS OF THE ACQUISITION
In terms of the Acquisition, the initial purchase is for 13% of New Plats`
equity in Tjate for a purchase price of R65 million to be discharged by the
issuance of 7,455,642 Jubilee ordinary shares listed on the JSE Limited ("JSE")
at a volume weighted average trading price on all markets in the 30 business
days preceding the signature date of the Agreement of R8.72 per Jubilee share.
This initial purchase in full, together with its original 25% equity and earn-in
right to a further 10%, will result in Jubilee holding 48% of Tjate.
The shareholders in Tjate have pre-emptive rights and should the shareholders,
other than Jubilee, exercise their pre-emptive rights Jubilee`s initial purchase
will be reduced, as will the purchase price in proportion.
The Agreement grants Jubilee an exclusive and irrevocable Call option, and New
Plats an irrevocable Put option on Jubilee, to purchase in a single tranche a
further 15% of New Plats`s equity in Tjate for a price of R75 million. The
purchase price will be discharged by the issuance of the equivalent value of
Jubilee ordinary shares listed on the JSE at a volume weighted average trading
price on all markets in the 30 business days preceding the signature date of the
Agreement.
The Call option is exercisable by Jubilee at any stage for a period of three
years, from the expiry of the 45-day pre-emptive rights period as reflected in
the shareholders agreement governing Tjate. The Put option is exercisable by New
Plats at any stage after 1 February 2007 for a period of two years and a further
240 days thereafter. The option sale of shares is subject to South African
Reserve Bank and DME approval.
Should the other shareholders in Tjate exercise their pre-emptive rights,
Jubilee`s call option will be reduced, as will the purchase price in proportion.
To the extent that Jubilee makes an offer to acquire any other shares in Tjate
from any other shareholders, New Plats agrees to waive all of its pre-emptive
rights.
5. UNAUDITED PRO FORMA FINANCIAL EFFECTS OF THE ACQUISITION
The unaudited pro forma financial effects set out below have been prepared for
illustrative purposes only to assist Jubilee shareholders to assess the impact
of the Acquisition on the loss per share ("EPS"), headline loss per share
("HEPS"), net asset value ("NAV") per share and tangible net asset value
("TNAV") per share of Jubilee. The unaudited pro forma financial effects have
been prepared for the year ended 30 June 2006 and are based on the reviewed
International Financial Reporting Standards ("IFRS") figures for the year ended
30 June 2006 as disclosed in the Pre-listing Statement of Jubilee dated 6
December 2006.
These unaudited pro forma financial effects have been disclosed in terms of the
JSE Listings Requirements and because of its nature may not fairly present
Jubilee`s financial position, changes in equity, results of operations or cash
flows.
The unaudited pro forma financial effects are the responsibility of the
directors of Jubilee and are provided for illustrative purposes only.
Audited before Unaudited pro-
the acquisition forma after the Change
(pence) acquisition (%)
(pence)
Basic loss per share (0.83) (1) (0.77) (2) 7.28
Headline loss per share (0.83) (1) (0.77) (2) 7.28
NAV per share 13.00 (3) 17.00 (4) 33.35
TNAV per share 8.00 (3) 9.00 (4) 10.38
Notes:
1. The basic loss and headline loss per share, as set out in the "Before
the acquisition" column of the table, are based on the reviewed IFRS
income statement of Jubilee for the year ended 30 June 2006 and
74,355,295 weighted average number of shares in issue.
2. The basic loss and headline loss per share, as set out in the "After
the acquisition" column of the table, are based on the reviewed IFRS
income statement of Jubilee for the year ended 30 June 2006; the
audited income statement of Tjate for the year ended 30 June 2006;
81,617,864 weighted average number of shares in issue; and the
assumptions that:
* the acquisition became effective at the beginning of the
financial year;
* the consideration was paid at the beginning of the financial
year.
3. The net asset value and tangible net asset value per share as set out
in the "Before the acquisition" column of the table are based on the
reviewed IFRS balance sheet of Jubilee at 30 June 2006 and 78,648,974
shares in issue.
4. The net asset value and tangible net asset value per share as set out
in the "After the acquisition" column of the table, are based on the
reviewed IFRS balance sheet of Jubilee at 30 June 2006; the assets
acquired in terms of this transaction; 85,911,544 shares in issue; and
the assumptions that:
* the acquisition became effective at the end of the financial
year;
* the consideration was paid at the end of the financial year.
5. Transaction costs were assumed to have been paid in cash at the end of
the financial year and were capitalised.
6. CONDITIONS PRECEDENT TO THE ACQUISITION
The Acquisition is subject to the approval of the South African Reserve Bank and
the approval of the DME.
7. OPINIONS AND RECOMMENDATIONS
The board of directors Jubilee is of the unanimous opinion that the terms and
conditions of the Acquisition are to the benefit of Jubilee shareholders.
Johannesburg and London
12 December 2006
Investment Bank and Sponsor in South Africa : Investec Bank
Corporate law advisors in South Africa : Yates Corporate Law
Technical advisor : Snowden
Date: 12/12/2006 10:00:01 Produced by the JSE SENS Department.
