Acquisition of Cape Lime and Withdrawal of Cautionary Announcement Afrimat Limited Incorporated in the Republic of South Africa (Registration number: 2006/022534/06) Share code: AFT ISIN: ZAE000086302 (“Afrimat” or “the Company”) ACQUISITION BY AFRIMAT OF 100% OF CAPE LIME PROPRIETARY LIMITED AND WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT 1. Introduction The board of directors of Afrimat is pleased to announce that it has concluded an agreement in respect of the acquisition of 100% of the issued ordinary shares of Cape Lime Proprietary Limited (“Cape Lime”) (“the Acquisition”). 2. Description of the business of Cape Lime The business of the Cape Lime dates back to 1946 and consists of activities related to the mining and processing of Dolomitic and Calcitic Limestone. The operations are presently conducted at two mines located in the Western Cape and for which mining rights are held. Cape Lime has a mining right for a third mine but has to date not commenced with mining activities. Cape Lime supplies a wide range of products primarily to manufacturing industries producing chemicals, filler, glass, paint and food products. In addition its products are used for water purification, soil treatment, effluent treatment, building and construction. 3. Rationale for the Acquisition The Acquisition will complement and augment Afrimat’s industrial minerals product offering and further expand its footprint across South Africa. The parties to the Acquisition recognise the scale of potential business opportunities that such a relationship presents, as Afrimat and Cape Lime have different and complementary strengths. Leverage from the combined strengths will result in developing new revenue opportunities for Afrimat and Cape Lime. 4. Classification of the transaction The Acquisition is classified as a Category 2 transaction in terms of the Listings Requirements of the JSE Limited (“LR”). The Acquisition is not a related party transaction in terms of the LR. 5. Vendors The vendors of Cape Lime are the Sarel Pool Familietrust, Gerhard Terblanche Familie Trust, Korum Trust and Dormell Properties 428 Proprietary Limited (“Vendors”). 6. Effective date The effective date of the Acquisition is last day of the month during which the conditions precedent are fulfilled or waived and the agreement becomes unconditional and enforceable in all respects. A finalisation announcement will be made when the Acquisition becomes unconditional. 7. Purchase consideration The aggregate purchase consideration payable for the acquisition of Cape Lime is R276 million. Afrimat will settle the purchase consideration in cash amounting to R252 million and the re-issuing of treasury shares amounting to R24 million. The share settled portion of the purchase consideration will be based on the 30 day Volume Weighted Average Price ("VWAP") of Afrimat as at 9 October 2015. 8. Conditions Precedent The Acquisition is subject to the following conditions precedent: - Satisfactory completion of the due diligence process conducted by Afrimat and its advisors including but not limited to the following: - Confirming the quantum of the full environmental rehabilitation liability of historical mining impacts in terms of any and all relevant regulatory and legislative requirements, including but not limited to the Minerals Act; - Confirming compliance to Environmental Laws; - Confirming compliance to mining right conditions; - Confirming the remaining life of mineral resources; - Confirming the sustainability of profit and cash generation ; - Confirming compliance to laws and regulations including IFRS; - Approval by the Board of Directors of Afrimat; - Approval by the shareholders of Cape Lime; and - Obtaining all regulatory approvals or clearances as may be required. Other than as disclosed in this announcement, there are no other significant terms to the Acquisition. 9. Net assets and profits of Cape Lime The intrinsic value of 100% of the net assets that are the subject of the Acquisition as at 31 August 2015 amounts to R49 363 173. The normalised profit after tax (excluding non-recurring profits) for the year ended February 2015 attributable to the net assets that are the subject of the Acquisition, amounts to R28 000 000. 10. Memorandum of Incorporation Afrimat undertakes that the Memorandum of Incorporation of Cape Lime will conform to Schedule 10.21 of the Listings Requirements of the JSE, as required. 11. Withdrawal of cautionary announcement Following the release of this announcement, the cautionary announcement published by Afrimat on 16 September 2015 is hereby withdrawn and caution is no longer required to be exercised by Afrimat shareholders when dealing in Afrimat shares. Cape Town 12 October 2015 Sponsor: Bridge Capital Advisors Proprietary Limited Date: 12/10/2015 07:05:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on, information disseminated through SENS.