EXX - Exxaro Resources Limited - Joint Exxaro / PE Minerals News Release Release Date: 09/06/2008 13:00:01 Code(s): EXX
EXX - Exxaro Resources Limited - Joint Exxaro / PE Minerals News Release
Exxaro Resources Limited
(formerly Kumba Resources Limited)
Incorporated in the Republic of South Africa
(Registration Number: 2000/011076/06)
Share Code: EXX
ISIN Number: ZAE000084992
("Exxaro" or "the company")
JOINT EXXARO / PE MINERALS NEWS RELEASE
Exxaro and PE Minerals initiative leads to increased Namibian ownership of Rosh
Diversified South African-based resources company Exxaro Resources (Exxaro), the
Rosh Pinah Zinc Corporation (Pty) Limited (Rosh Pinah) and the Namibian
empowerment company PE Minerals today announced that Exxaro has divested a 43,8%
interest in Rosh Pinah to Namibian shareholder groupings. This effectively
reduces Exxaro`s shareholding in Rosh Pinah to 50,04%, with 49,96% held by
Exxaro will continue to manage the Rosh Pinah mine in south-western Namibia in
terms of a management agreement. Together with Exxaro`s Zincor refinery in
Gauteng which it supplies with zinc concentrate, Rosh Pinah mine is part of one
of few integrated zinc mining and refinery operations in the world.
In the 2007 financial year Rosh Pinah and Zincor produced 95kt of zinc
concentrate and 101kt of zinc metal respectively.
The Namibianisation transaction follows an agreement between Rosh Pinah,
shareholder PE Minerals, the Namibian government and Exxaro`s predecessor, Iscor
Limited, in terms of which the parties agreed to sell a 50% interest in Rosh
Pinah to Namibian citizens. Prior to today`s transaction, the shareholding of
Exxaro in Rosh Pinah was 93,9%, with PE Minerals holding 6,1%.
Speaking at the announcement in Windhoek today, Exxaro`s chief executive
officer, Sipho Nkosi, said: "Since our listing in 2007 we have fully supported
the obligations Exxaro assumed from its predecessors Iscor and, in turn, Kumba
Resources. However, it was only when buoyant zinc commodity prices improved
substantially from mid-2006 that the parties were able to develop a bankable
financial structure to support the transaction, bringing us to today`s reality."
Chairman of Rosh Pinah Zinc Corporation (Pty) Limited and Exxaro`s chief
financial officer, Dirk van Staden, added: "This announcement marks the
culmination of many months of work overseen by the Rosh Pinah board, banks,
legal experts and the respective teams from Exxaro and PE Minerals. The deal
involves a major employer in and contributor to the Namibian economy and adds
significant value to a range of stakeholders including the people of the
Chairman of PE Minerals, Aaron Mushimba, said: "This private sector initiative
between Exxaro, PE Minerals and Rosh Pinah shows a unified commitment to social
responsibility and empowerment of Namibians during tough economic times.
Although commodity prices have improved significantly and mines are performing
better, the financiers of this transaction would not have felt comfortable to
finance it without the political stability created by the Namibian government.
The shareholder base has been widened significantly among Namibians, including
the workforce at Rosh Pinah."
Together with Exxaro, the transaction was facilitated by PE Minerals, the holder
of the mineral rights for Rosh Pinah, which was tasked to evaluate and consider
appropriate beneficiaries of the transaction, obtain Namibian government
approval of new shareholders, and negotiate and structure the transaction on
behalf of Namibian shareholders.
The new Namibian shareholders are represented by the company, Jaguar, consisting
of a broad-based range of shareholders. Beneficiaries through Jaguar range from
traditional authorities, communities and individuals including employees.
The shareholders have agreed to form an employee empowerment participation
scheme in terms of which qualifying employees at Rosh Pinah will be entitled to
3% of the future dividends declared by Rosh Pinah. In terms of the agreement
Exxaro, PE Minerals and Jaguar will each donate a proportionate number of shares
to form a trust through which the employee empowerment participation scheme will
Once the shares have been taken up by the trust the final shareholding in Rosh
Pinah will be:
* Exxaro 50,04%
* PE Minerals Namibia 8,00%
* Jaguar 38,99%
* Employee Empowerment Participation Scheme 2,97%
The transaction steps include:
* Rosh Pinah will declare a dividend of R435 million to its existing
shareholders (Exxaro R408 million and PE Minerals R27 million) from its
* Shareholder loans of R80 million (Exxaro R75 million and PE Minerals R5
million) will be made to Rosh Pinah.
* Rosh Pinah has procured committed working capital facilities with no
recourse to its shareholders to the value of R300 million from ABSA Bank
Ltd and Standard Bank of Namibia Ltd.
* To accommodate the capital structure 60% of Rosh Pinah`s zinc and lead
price exposure for 42 months will be hedged. A total of 47% has been hedged
Through a combination of share transfers and new issues Namibian ownership of
49,96% in the shareholding of Rosh Pinah is effected.
This announcement is not required in terms of the JSE Listings Requirements but
has been published for information purposes only.
Exxaro is one of the largest South African-based diversified resources groups,
with interests in the coal, mineral sands, base metals, industrial minerals and
iron ore commodities. In November 2006 Kumba Resources was unbundled in terms of
which its iron ore assets were re-listed on the JSE Limited as Kumba Iron Ore,
and its non-iron ore assets were merged with the coal assets of Eyesizwe Coal
and re-listed as Exxaro. www.exxaro.com
PE Minerals, one of the first Namibian empowerment companies, is the holder of
the mineral rights for Rosh Pinah Zinc Corporation (Pty) Ltd, a zinc and lead
mine at Rosh Pinah Town. After implementation of the transaction it will hold an
eight percent shareholding in the Rosh Pinah mine. PE Minerals has been active
in promoting and initiating empowerment projects in Namibia in various fields of
operation and is proud to be involved with Exxaro in this initiative whereby
Namibian entities have increased their overall shareholding in Rosh Pinah Zinc
Corporation to 49,96%.
Rosh Pinah Zinc Corporation (Pty) Limited:
Rosh Pinah Zinc Corporation (Pty) Ltd is a subsidiary of Exxaro Base Metals
(Namibia) (Pty) Limited and owns the Rosh Pinah zinc/lead mine.
Exxaro Base Metals (Pty) Limited:
Exxaro Base Metals (Pty) Limited is a subsidiary of Exxaro Resources Limited and
owns the Zincor refinery.
Executive General Manager: Corporate Affairs & Investor Relations
Tel: +27 (0) 12 307 3292
Mobile: +27 (0) 83 609 1444
PA to the Coordinator
Tel: +264 (0) 61 240 956
Fax: +264 (0) 61 240 941
Sponsor: J.P.Morgan Equities
Date: 09/06/2008 13:00:01 Supplied by www.sharenet.co.za
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