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LON - Lonmin - Acquisition of AfriOre - Payment and Change of Control
Lonmin Plc
(Incorporated in England and Wales)
(Registered in the Republic of South Africa
under registration number
1969/000015/10)
JSE code: LON
Issuer Code: LOLMI & ISIN: GB0031192486
("Lonmin")
Lonmin Plc (``Lonmin``) today announces that it has paid for the common
shares (the "Shares") in AfriOre Limited ("AfriOre") deposited and taken up
on 26 January 2007. The approximately 49.4 million Shares taken up and paid
for by Lonmin represents approximately 94% of the aggregate number of Shares
issued and outstanding, giving Lonmin direct control of AfriOre.
Lonmin has now taken over control of the operations of AfriOre, including its
PGM assets at Akanani. All of the former directors of AfriOre have resigned
from the board and have been replaced by Brad Mills, John Robinson, Ian
Farmer and Jack Jones, who are all directors or senior officers of Lonmin.
Commenting on the completion of the acquisition, Brad Mills, Chief Executive
of Lonmin, said:
`We believe that Akanani is a high quality South African PGM project with
considerable expansion potential. We look forward to working with the BEE
partners, the DME and the local community to move the project through the
feasibility stage, to complete permitting, obtain a mining licence and begin
mine development.`
The Akanani deposit has a strike length of around 9 km and the Platreef ore
body lies at a depth of between 800 metres and 2,000 metres. The average true
width of the targeted P2 horizon is 19 metres. Akanani has reported total
inferred P2 resources of 249.1 million tonnes containing 33.7 million ounces
of PGMs at a grade of 4.2 g/t - 3 PGE+Au. In-fill drilling will be undertaken
to improve the level of confidence in the current resource base while
exploration drilling will examine the potential of the centre and north of
the Akanani lease area.
Lonmin`s preliminary evaluation suggests that the current resource could
support an initial mine development producing around 500,000 ounces of PGMs
per anum, including around 250,000 ounces of platinum. A pre-feasibility
study, commissioned by AfriOre and undertaken by consultant engineers SRK, is
due shortly. This will provide the groundwork for a full feasibility study, a
mining licence application and mine development. Attributable capital
expenditure for mine, concentrator and infrastructure development is
currently estimated at US$600-700 million.
Lonmin`s C$8.75 cash offer for AfriOre has been extended to 1:00 p.m.
(Toronto time) on 8 February 2007 to give shareholders of AfriOre who have
not tendered their Shares under the Offer an opportunity to do so. As Lonmin
has acquired over 90% of the issued and outstanding Shares, it will cause
AfriOre to use the statutory procedure for the redemption of the outstanding
Shares not held by Lonmin immediately after the expiry of the Offer, as
permitted under the applicable laws of the British Virgin Islands.
For further information about tendering procedures shareholders of AfriOre
may contact Innisfree M&A Incorporated at 1-888-750-5834 (English speakers in
Canada and U.S.), 1-877-825-8777 (French speakers in Canada and U.S.) or
00800-7710-9970 (from the United Kingdom and other European Union countries
as well as Switzerland and Norway). Banks and brokers may call collect at 1-
212-750-5833.
Enquiries:
Alex Shorland-Ball +44 (0) 20 7201 6060
Vice President, Investor Relations & Communications
Forward Looking Statements:
This announcement may include forward-looking statements. All statements
other than statements of historical fact included in this announcement,
including without limitation those regarding Lonmin`s plans, objectives and
expected performance, are forward-looking statements. Lonmin has based these
forward-looking statements on its current expectations and projections about
future events, including numerous assumptions regarding its present and
future business strategies, operations, and the environment in which it will
operate in the future. Forward-looking statements generally can be identified
by the use of forward-looking terminology such as `ambition`, `may`, `will`,
`could`, `would`, `expect`, `intend`, `estimate`, `anticipate`, `believe`,
`plan`, `seek` or `continue`, or negative forms or variations of similar
terminology. Such forward-looking statements involve known and unknown risks,
uncertainties, assumptions and other factors related to Lonmin, including,
among other factors: (1) the risk that the businesses of Lonmin and AfriOre
will not be integrated successfully; (2) material adverse changes in economic
conditions generally or in relevant markets or industries in particular; (3)
fluctuations in demand and pricing in the mineral resource industry and
fluctuations in exchange rates; (4) future regulatory and legislative actions
and conditions affecting Lonmin`s and AfriOre`s operating areas or licensing;
(5) obtaining and retaining skilled workers and key executives; and (6) acts
of war and terrorism. By their nature, forward-looking statements involve
risks, uncertainties and assumptions and many relate to factors which are
beyond Lonmin`s control, such as future market conditions and the behaviour
of other market participants. Actual results may differ materially from those
expressed in forward-looking statements. Given these risks, uncertainties,
and assumptions, you are cautioned not to put undue reliance on any forward-
looking statements. In addition, the inclusion of such forward-looking
statements should under no circumstances be regarded as a representation by
Lonmin that Lonmin will achieve any results set out in such statements or
that the underlying assumptions used will in fact be the case. Other than as
required by applicable law or the applicable rules of any exchange on which
Lonmin`s securities may be listed, Lonmin has no intention or obligation to
update or revise any forward-looking statements included in this announcement
after the release of this announcement.
Date: 01/02/2007 07:31:11 Supplied by www.sharenet.co.za
Produced by the JSE SENS Department.
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