AFRICAN RAINBOW MINERALS LIMITED - ARM concludes definitive agreements for the disposal of its 50% effective interest in Dwarsrivier Chrome Mine

ARM concludes definitive agreements for the disposal of its 50% effective interest in Dwarsrivier Chrome Mine

AFRICAN RAINBOW MINERALS LIMITED
(Incorporated in the Republic of South Africa)
Registration number: 1933/004580/06
Share code: ARI
ISIN: ZAE000054045

AFRICAN RAINBOW MINERALS (“ARM”) CONCLUDES DEFINITIVE AGREEMENTS FOR THE
DISPOSAL OF ITS 50% EFFECTIVE INTEREST IN THE DWARSRIVIER CHROME MINE TO
ASSORE LIMITED (“ASSORE”)

1. INTRODUCTION

Shareholders are referred to the announcement of 27 February 2015 released on the Johannesburg
Stock Exchange by ARM, in which shareholders were advised that ARM and Assore had reached an
in-principle agreement on ARM’s disposal of its effective 50% interest in the Dwarsrivier Chrome Mine
(“Dwarsrivier”) to Assore (the “Transaction”).

The parties to the Transaction have now concluded definitive agreements in respect of the
Transaction which will result in Assore owning 100% of Dwarsrivier.

Dwarsrivier is presently owned and operated by Assmang Proprietary Limited (“Assmang”), the equal
joint venture between ARM and Assore. Dwarsrivier mines chrome ore near Lydenburg in the
Mpumalanga province. The ore produced is sold both on the export market and locally. In order to
effect the Transaction, Assmang will sell Dwarsrivier to K2011105280 Proprietary Limited, a special
purpose company (“Dwarsrivier SPV”), in which Assore will, pursuant to the implementation of the
Transaction, own the entire issued share capital.

2. SALIENT FEATURES OF THE TRANSACTION

        a. Disposal consideration

            ARM will receive a ZAR450,000,000 (four hundred and fifty million South African Rand)
            cash consideration in respect of its effective 50% interest in Dwarsrivier (“Consideration”).

            To secure this payment obligation, Assore has deposited the Consideration into an
            interest-bearing account in favour of ARM.

            Assore has also agreed to refund any amounts advanced to Dwarsrivier by Assmang
            between 1 July 2014 (being the effective date) and the implementation date of the
            Transaction up to a maximum amount of ZAR800 million. In addition any cash profits
            earned by Dwarsrivier between these two dates will be transferred to Dwarsrivier SPV as
            part of the Transaction.

        b. Management of the Business

            The Competition Tribunal of South Africa approved the implementation of the Transaction
            in accordance with the Competition Act on 22 April 2015. Assmang will continue to
            manage Dwarsrivier until the Transaction is completed. To this end, Assmang has
            mandated a committee comprised of experienced employees of ARM and Assore.

3. CONDITIONS PRECEDENT

    The implementation of the Transaction is subject to the fulfilment of the following conditions:

    a) Dwarsrivier SPV must be registered as a vendor in terms of the Value Added Tax Act;

    b) Ministerial consent shall have been obtained for the transfer of the Dwarsrivier mining right
       from Assmang to Dwarsrivier SPV in terms of section 11 of the Minerals and Petroleum
        Resources Development Act ( the “Section 11 approval”); and

    c) the approval of the board of directors of Assmang, Assore, ARM and Dwarsrivier SPV for
       specific transaction steps that will allow the parties to implement the Transaction after receipt
        of the Section 11 approval.

4. CATEGORISATION

    The Transaction is not a categorised transaction for ARM in terms of the JSE Limited Listings
    Requirements.

END

For all related queries please contact:

Jan Steenkamp
Chief Executive of Strategic Services and Exploration
Office: +27 11 779 1000
Email: jan.steenkamp@arm.co.za

Sandton
25 June 2015



Investment bank and corporate advisor to ARM: Absa Bank Limited

Sponsor to ARM: Deutsche Securities (SA) Proprietary Limited

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