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Acquisition of mining assets and cautionary announcement
Sable Exploration and Mining Limited
(previously known as Middle East Diamond Resources Limited)
(Incorporated in the Republic of South Africa)
(Registration number: 2001/006539/06)
(Share Code: SXM ISIN Code: ZAE000303319)
(“SEAM” or “the company”)
Acquisition of mining assets and cautionary announcement
1. Introduction
Shareholders are advised that SEAM and Sable Platinum Holdings (Pty) Ltd, a wholly owned
subsidiary of SEAM has entered into an agreement with Magni Investment Holdings (Pty) Ltd
(“Magni”) and Lurco Metals (Pty) Ltd (“Lurco Metals”) on 23 November 2021 regarding the
proposed acquisition of the following assets:
• All the issued shares of, and claims on loan account against, LMS Holdco (Pty) Limited
(“LMS”) from Magni. LMS is focused on the acquisition and treatment of coal from
Seriti's Van Dyk's Drift Discard Dump to toll-wash for Seriti, to supply Eskom and for
export. LMS owns 100% of a coal washing plant capable of producing 1.4mtpa of
4800kcal coal and leases the Springbok Siding from Transnet;
• All the issued shares of, and claims on loan account against, Destiny 11 Spring
Investments (Pty) Limited (“Destiny”) from Magni. Destiny operates the Vlakpoort
Chrome mine in the North West Province of South Africa with resources in-situ in
excess of 3 million tons;
• All the issued shares of, and claims on loan account against, Vastek Trading (Pty)
Limited (“Vastek”) from Lurco Metals. Vastek operates a Chrome beneficiation project
in the North West Province of South Africa that procures chrome ore from the
community owned dumps and toll treats this feed at a 50t/hour plant to produce
chrome concentrate. In addition the prosecting rights of NW 30/5/1/1/3/2/1/12546 PR
and NW 30/5/1/1/2/12580 PR are included; and
• All the issued shares of, and claims on loan account against, Lurco Eswatini (Pty) Ltd
(“Lurco”) from Magni. Lurco holds the Prospecting Right over a high quality Anthracitic
Coal site (previously mined by Gencor) with a discard dump for reclamation and further
development of an open cast mine.
for an amount of R1 200 000 000 (“the Acquisition”) (“the Assets”).
2. Rationale
SEAM has spent years investigating various operating and development assets that will add
value to its shareholders. The operations are cash generative and the development asset in
Eswatini has the potential to generate cash flow in the short term from the dump and the
resources indicate the development of an operating mine.
3. Salient terms of the Acquisition
3.1 As part of this Acquisition, SEAM will reverse list the assets through a combination of
share issue, cash and claims on loan account for an amount of R1 200 000 000. To the
extent that any shares are issued by SEAM as part of the purchase consideration, such
purchase consideration will be settled by the allotment and issuance of shares at R5.00
each by SEAM.
It is envisaged that the Acquisition will take the form of a reverse take-over in terms of the
JSE Listings Requirement.
3.2 Magni, GEM Global Yield LLC SCS and GEM Yield Bahamas Ltd entered into the GEM
Share Subscription Facility Agreement dated 28 August 2021 in terms of which, inter alia,
GEM Global Yield LLC SCS agrees to make available up to USD300,000,000 facility for
the purposes of subscribing for shares in the “Issuer” (“Share Subscription Facility
Agreement”). Magni reserves the right to nominate and support SEAM as “Issuer” under
the Share Subscription Facility Agreement.
3.3 The parties will enter into definitive agreements by no later than 28 February 2022.
3.4 The Acquisition will be subject to normal warranties that are customary for transactions of
this nature.
4. Rights offer
As previously announced, SEAM intends undertaking a rights offer. SEAM intends applying
to the JSE to lift its suspension after this announcement. Once the suspension has been lifted,
SEAM will undertake a rights offer of 50 million shares at R1 per share. Approximately R20
million will be underwritten by various shareholders including James Allan, the CEO of SEAM.
Magni will underwrite 10 million shares at R1 per share for a total amount of R10 million.
5. Conditions precedent
The Acquisition is subject to the following conditions:
5.1 the Parties shall have obtained the necessary regulatory approvals to implement the
Acquisition, including, approvals from the Takeover Regulation Panel, Department of
Mineral Resources and the JSE;
5.2 the preparation of a fair and reasonable opinion by an independent expert, if required;
5.3 the approval by the JSE of the Competent Person's Report for the Assets;
5.4 the necessary approvals by the shareholders of SEAM of the Acquisition;
5.5 waiver of mandatory offer by the requisite majority of SEAM Shareholders;
5.6 Magni and Lurco Metals shall have obtained any third party approvals it may require in
order to implement the Acquisition, including the necessary approvals from any
financiers or counter-parties to any material contracts, as may be applicable; and
5.7 the lifting of SEAM’s suspension by the JSE.
After the implementation of the Acquisition, the board of SEAM will be reconstituted and
reappointed with the majority of the nominees to be appointed from Magni.
6. Categorisation of the Disposal and cautionary announcement
SEAM is in discussions with the JSE to confirm the Acquisition is a reverse take-over and
accordingly shareholders are advised to exercise caution when dealing in the company’s
shares until the category is determined.
7. Financial information and cautionary announcement
The financial information relating to the Acquisition will be available in due course.
Accordingly, shareholders are advised to exercise caution when dealing in the company’s
shares until the financial information is released.
24 November 2021
Sandton
Sponsors
Exchange Sponsors
Date: 24-11-2021 10:26:00
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