Lonmin Announces The Signing Of Legally Binding Agreements For The Purchase By

Lonmin Announces The Signing Of Legally Binding Agreements For The Purchase By  
Lonmin And Incwala Of Implats" Entire 27.1% Holding In Lonplats                 
6 September 2004                                                                
LONMIN Plc                                                                      
(Incorporated in the United Kingdom)                                            
Share code : LON                                                                
ISIN code : GB0031192486                                                        
("Lonmin")                                                                      
LONMIN ANNOUNCES THE SIGNING OF LEGALLY BINDING AGREEMENTS FOR THE PURCHASE BY  
LONMIN AND INCWALA OF IMPLATS" ENTIRE 27.1% HOLDING IN LONPLATS                 
Lonmin Plc ("Lonmin") is pleased to announce that it has today signed legally   
binding agreements with Impala Platinum Holdings Limited ("Implats"), various   
broad-based Historically Disadvantaged South African ("HDSA") entities and the  
Industrial Development Corporation ("IDC").  Under these agreements, Implats    
will, on completion, sell its entire 27.1% stake in each of Western Platinum    
Limited and Eastern Platinum Limited (together "Lonplats") to Lonmin and the    
HDSA investors, and Lonmin will participate in the formation of a significant   
HDSA controlled mining investment company, Incwala Resources (Proprietary)      
Limited ("Incwala Resources").  The transaction is expected to complete, subject
to certain conditions, including approval by Lonmin shareholders, by 30         
September 2004.                                                                 
Under the agreements signed today, Lonmin will acquire (net) 9.1% of Lonplats   
for US$282.6 million, increasing the direct stake in its main operating         
subsidiaries to 82%.  Incwala Resources, through its 100% held subsidiary,      
Incwala Platinum (Proprietary) Limited, will acquire the remaining 18% stake in 
Lonplats for US$480.2 million and will effectively become Lonplats" HDSA partner
of choice in its operations.                                                    
Strategic benefits of the Transaction                                           
The benefits to Lonmin of the transaction are significant:                      
- It will facilitate the introduction of broad-based HDSA equity ownership in   
Lonplats" operations and contribute towards Lonplats" programme for securing new
mining and prospecting licences under South Africa"s Mining and Empowerment     
Legislation                                                                     
- It will lead to the formal termination of the Principals" Agreement which has 
governed the relationship between Lonmin and Implats in relation to Lonplats,   
including an ability for Implats to increase its shareholding in Lonplats to in 
excess of 50% in the event of a change of control of Lonmin                     
- It presents Lonmin with the opportunity to consolidate its shareholding in its
main operating asset, Lonplats.                                                 
Incwala Resources                                                               
Incwala Resources will be controlled by HDSA investors, led by Andisa Capital,  
Dema Capital and Vantage Capital, who will between them hold a 52.88%           
shareholding in Incwala Resources.  Also included are the South African Women in
Mining Trust (SAWIMIH), a women"s empowerment group, a trust set up for the     
benefit of the Bapo Ba Mogale community (comprising some 30,000 members) and the
Lonplats Employee Masakhane Trust ("LEM").                                      
The LEM will have a 1.1% direct shareholding in Incwala Resources as well as    
hold a 25% equity interest in each of the Andisa, Dema and Vantage consortia.   
This equates to the LEM having a direct and indirect aggregate equity interest  
in Incwala Resources of some 13.27%.  The sole beneficiary of the LEM will be   
the Masakhane Provident Fund, the beneficiaries of which are Lonplats employees.
Masakhane"s membership is approaching 20 000, consisting exclusively of Lonplats
employees, almost all of whom are HDSAs.                                        
The HDSA consortia will acquire their 52.88% interest in Incwala Resources for  
US$193 million and will fund it as follows:                                     
- US$59.3 million will be commercially funded by the issue of preference shares 
to certain South African banks. Lonmin has agreed to grant these banks a put    
option in respect of an aggregate of US$15 million principal amount of these    
preference shares, exercisable in the event of default by the HDSA investors    
- US$118.4 million will be in the form of vendor loans to Andisa Capital, Dema  
Capital and Vantage Capital, US$23.4 million of which will be provided by Lonmin
and US$95 million provided by Implats. Lonmin will indemnify Implats in relation
to the non-payment of the US$95 million principal amount by the HDSA investors  
to Implats and the HDSA investors will counter-indemnify Lonmin in relation to  
any liability incurred by Lonmin under the indemnity to Implats                 
- US$5.4 million will be in the form of an interest free loan provided by Lonmin
to the Bapo Ba Mogale trust which will also receive a loan of a further US$5    
million from the IDC                                                            
- Lonmin will provide loans of US$1 million to SAWIMIH and US$4 million to LEM. 
Lonmin and the IDC will each subscribe for a 23.56% equity interest in Incwala  
Resources for US$90.3 million and US$81.7 million respectively, resulting in a  
total equity capital subscription in Incwala Resources of US$365 million.       
Incwala Resources will also raise US$125 million in preference shares from a    
number of South African and international banks on attractive terms, providing  
total equity and preference capital of US$490 million.                          
The formation of Incwala Resources represents a fundamental step in delivering  
Lonmin"s commitment to Black Economic Empowerment ("BEE") and fulfilling the    
requirements of the Mining Charter.  Incwala Resources will initially have a    
strong balance sheet and widely distributed HDSA shareholdings and will make an 
ideal strategic partner for Lonmin in South Africa.  Incwala Resources" business
strategy is to take advantage of the reorganisation of South Africa"s mining    
industry, which will occur under the new Mining Charter and create a diversified
mining house with wide HDSA ownership.                                          
Net investment by Lonmin                                                        
Following completion of this transaction, Lonmin"s total cash investment,       
including costs of approximately US$26 million, will amount to approximately    
US$433 million as follows:                                                      
Description                                    US$                              
                                               (million)                        
Acquisition of an additional net 9.1% in       282.6                            
Lonplats                                                                        
Acquisition of 23.56% equity stake in Incwala  90.3                             
Resources                                                                       
Vendor finance loans to HDSA Consortia         28.8                             
Loans to the broad based HDSA investors -      5.0                              
SAWIMIH and the LEM Trust                                                       
Transaction costs                              26.0                             
Total                                          432.7                            
The net investment will result in Lonmin increasing its direct shareholding in  
Lonplats to 82.0% and a 23.6% equity shareholding in Incwala Resources. From    
completion, Incwala Resources will initially be accounted for by Lonmin as an   
associate.                                                                      
Lonmin will satisfy the consideration from the existing cash resources and      
credit facilities of the Group. The transaction is expected to be earnings      
neutral in 2004 and cashflow neutral in 2005.  The value of the net assets being
acquired will be US$433 million.  The Board believes that, after this           
transaction, the Group will be able to maintain its ongoing capital expenditure 
commitments and the existing dividend policy for Lonmin.                        
Shareholder Approval Requirement                                                
The transaction includes a number of related party transactions for Lonmin under
the UKLA Listing Rules and as such requires shareholder approval.  Accordingly, 
a circular containing further details of the transaction will be posted to      
Lonmin shareholders shortly  and an Extraordinary General Meeting is expected to
be held toward the end of September.                                            
Morgan Stanley & Co. Limited and Cazenove & Co. Ltd are acting as financial     
advisers to Lonmin and Cazenove & Co. Ltd is advising Lonmin in relation to the 
financing arrangements for Incwala Resources and Incwala Platinum.              
Enquiries                                                                       
John Robinson, Finance Director    Lonmin Plc         +44 (0)7818 433 360       
Ian Farmer, Corp Development       Lonmin Plc         +27 11 268 6318           
Director                                                                        
Anthony Cardew/Olivia Gallimore    Cardew Chancery    +44 (0)20 7930 0777       
Morgan Stanley & Co. Limited is acting for Lonmin and no one else in connection 
with the proposed transactions and will not be responsible to anyone other than 
Lonmin for providing the protections afforded to clients of Morgan Stanley & Co.
Limited or for providing advice in relation to such proposed transactions.      
Cazenove & Co. Ltd is acting for Lonmin and no one else in connection with the  
proposed transactions and will not be responsible to anyone other than Lonmin   
for providing the protections afforded to clients of Cazenove & Co. Ltd or for  
providing advice in relation to such proposed transactions. Cazenove & Co. is   
authorised and regulated by the Financial Services Authority and is a member of 
the London Stock Exchange.                                                      
Date: 06/09/2004 11:20:09 AM Supplied by www.sharenet.co.za                     
Produced by the JSE SENS Department