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BUILDMAX LIMITED - Disposal of mining rights and related properties

Release Date: 10/07/2015 12:37
Code(s): BDM     PDF:  
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Disposal of mining rights and related properties

Buildmax Limited
Incorporated in the Republic of South Africa
(Registration No. 1995/012209/06)
Share Code: BDM
ISIN Code: ZAE000167318
  ("Buildmax" or the “Group”)

DISPOSAL OF MINING RIGHTS AND RELATED PROPERTIES

1. Introduction

Shareholders are referred to the announcement released by Buildmax on SENS on
28 August 2014 in terms of which shareholders were advised that Buildmax’s wholly-owned
subsidiary, Buildmax Aggregates and Quarries (Pty) Ltd (“BAQ”) had entered into an agreement
with Raubex Group Ltd ("Raubex") and its wholly-owned subsidiary, Raumix Aggregates (Pty) Ltd
("Raumix"), in terms of which –

   -   Raumix acquired certain assets of BAQ for a total consideration of R54 761 000 (the
       “Initial Transaction”); and
   -   BAQ was granted a put option, exercisable between 1 June 2015 and 31 December
       2016, to sell the mining rights in respect of aggregates and quarries held by BAQ’s
       subsidiaries as well as the related properties (collectively, the “Sale Assets”) (the
       “Option”) for an aggregate consideration of R37 000 000, payable in cash.

Buildmax is pleased to advise that BAQ and Raubex mutually agreed to an early exercise of the
Option and BAQ exercised the Option on 5 March 2015. In accordance with the terms of the Option,
Raumix settled the R37 000 000 Option consideration, in cash, on 10 March 2015.

2. Condition precedent

Notwithstanding the payment of the Option consideration, the Option is subject to receipt of
Ministerial consent to the cession and transfer of the relevant mining rights in terms of section 11
of the Mineral and Petroleum Resources Development Act, and will become effective on the date
consent is obtained.

3. Rationale for the disposal

The board of directors of Buildmax has determined that the aggregate and quarry operations of
BAQ, operated pursuant to the mining rights, are non-core to the main opencast mining and civils
business of Buildmax. The consideration received upon exercise of the Option will be used to fund
the working capital requirements of the broader Group.
4. Net asset value and profits attributable to the Sale Assets

For the year ended 28 February 2015, the net asset value attributable to the Sale Assets was
R37 million and the net profits attributable to the Sale Assets, earned in terms of a mining contract
entered into with Raumix, was R1.85 million.

5. Categorisation of the transaction

Section 9.11 of the JSE Listings Requirements requires the application of the aggregation principle
where a series of transactions are completed during a twelve month period with the same party or
associates thereof. Applying this principle to the Initial Transaction and the disposal in respect of
the Option results in the Option being categorised as a category one transaction. Accordingly, the
approval of the shareholders for the exercise of the Option will be sought at the Buildmax annual
general meeting.

The notice of annual general meeting, which shall contain, inter alia, the information required in
terms of paragraph 9.20(b) of the JSE Listings Requirements, will be posted to shareholders in
due course.


Benoni
10 July 2015


Sponsor to Buildmax
QuestCo (Pty) Ltd

Date: 10/07/2015 12:37:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
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