Sharenet Sites 
Sharenet Sites
Kpone gas- and oil-fired combined cycle EPC power plant update and cautionary annnouncement
Group Five Limited
(Incorporated in the Republic of South Africa)
(Registration number: 1969/000032/06)
Share code: GRF ISIN: ZAE000027405
("Group Five” or “the Company” or “the Group”)
KPONE GAS- AND OIL-FIRED COMBINED CYCLE EPC POWER PLANT UPDATE AND
CAUTIONARY ANNOUNCEMENT
The Group Five Board wishes to update the market on its Ghanaian engineer, procure and
construct (EPC) contract, Kpone. As indicated with the Group’s audited year-end results
released on 2 October 2018, this contract was estimated to be completed and handed over in
October 2018.
As committed, the final commissioning phase continued. However, commissioning can
currently not be completed with the key delay being due to contamination of the fuel being
provided to the Group by the client. The provision of fuel is the client’s responsibility. The
completion and hand over date will therefore be delayed, as it is dependent on the resolution
of the fuel contamination.
The Group continues to progress its contractual rights and entitlements through the alternative
dispute resolution procedures. These have been significantly progressed in the month of
October, including a submission to the International Chamber of Commerce (ICC) in Paris in
relation to claims against the client. As outlined before, Legal Counsel and Senior Legal
Counsel, with experience in local and international dispute resolution, have considered the
various claims that the Group deems it is entitled to from various counter-parties and
confirmed that these claims have merit.
The Board and executive management continue to implement strong actions to assess the
ongoing financial position of the Group. Due to its materiality, the Kpone contract and its cash
flow requirements are separately monitored, with detailed estimated gross cash monthly
outflows and inflows.
The Group has been informed, by two of the bank guarantee providers, that the client has
issued a written demand requesting that an amount of $62,7 million be paid to the client. As
previously noted, this demand by the client has not been independently determined and does
not reflect the counter claims the Group is legally entitled to and is pursuing.
The Group is in discussions with its legal advisors and Senior Counsel, as well as its bank
guarantee providers with regards to this demand and is taking all the required action. As the
Group believes this call is improper, it has instituted legal proceedings in the High Court of
Johannesburg to interdict the demands made by the client. Judgement has been scheduled
for tomorrow (Wednesday, 7 November 2018).
As the above may have a material impact on the price of Group Five’s securities, shareholders
are therefore advised to exercise caution when trading in the Company’s securities pending
the outcome of the abovementioned judgement.
Stakeholders will be kept appraised of developments.
06 November 2018
Sponsor
Nedbank Corporate and Investment Banking
Date: 06/11/2018 10:53:00 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.
