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Harmony Gold Mining Company Limited - Further announcement regarding the

Release Date: 01/02/2002 12:48:54      Code(s): HAR
proposed acquisition by Harmony and ARM of certain Free State Assets from
AngloGold Limited ("AngloGold")
Harmony Gold Mining Company Limited
  (Incorporated in the Republic of South Africa)
  (Registration number 1950/038232/06)
  Share code HAR   ISIN ZAE000015228
  ("Harmony")
African Rainbow Minerals (Proprietary) Limited
  (Incorporated in the Republic of South Africa)
  (Registration number 1997/015869/07)
  ("ARM")
Further announcement regarding the proposed acquisition by Harmony and ARM
of certain Free State Assets from AngloGold Limited ("AngloGold")
1. Introduction
Further to the joint announcement by Harmony and ARM on 7 January 2002 (the
"previous announcement") regarding the acquisition of certain assets and
businesses in the Free State goldfields from AngloGold (the "acquisition
assets"), JPMorgan Chase Bank and BoE are authorised to announce that the
necessary ruling from the South African Revenue Service, which would have
allowed the transfer of the acquisition assets to be constituted as a scheme
of rationalisation in terms of section 39 of the Taxation Laws Amendment Act
(Act 20 of 1994), as amended, has not been obtained.
2. Revised structure of the acquisition
Accordingly, in light of the agreement with AngloGold as set out in the
previous announcement, Harmony and ARM, through a jointly held company (the
"Company"), will acquire the acquisition assets directly from AngloGold, as
going concerns, with effect from 1 January 2002 ("the acquisition"), in
accordance with paragraph 3 below.
3. Consideration payable in terms of the revised structure
The consideration payable in terms of the revised structure will be an
amount of R2,2 billion, plus an amount equal to any liability for tax
payable by AngloGold pursuant to the sale by it of the acquisition assets
("the additional amount") (collectively, the "aggregate purchase price").
Accordingly, the Company will pay to AngloGold an amount of R2,2 billion
(equally funded by the joint venture partners), of which R1,8 billion will
be payable, in cash, on the date which is 10 business days following the
date upon which the conditions precedent referred to in paragraph 5 below
are fulfilled and the balance of R400 million, payable in cash, on 1 January
2005. The Company will pay to AngloGold the additional amount as and when
the corresponding liability is payable by AngloGold.
Under the revised structure the Company will, subsequent to the purchase of
the acquisition assets, be able to claim a significant portion of the
aggregate purchase price as a capital expenditure deduction against its
taxable income. The increased purchase price will be more than offset by
future tax deductions.
4. Management
The joint venture partners have assumed management control over the
acquisition assets as at 1 January 2002.
5. Conditions precedent
The implementation of the acquisition in terms of the revised structure is
subject to the fulfilment of the following conditions precedent by no later
than 30 April 2002, namely:
- the approval of the cession of the mining leases in respect of the
acquisition assets to the Company by the Minister of Minerals and Energy;
- the granting of the necessary mining authorisations to the Company; and
- the pre-requisite rulings and approvals of the relevant regulatory
authorities, including the Competition Authorities.
6. Further announcements
Harmony shareholders will be notified of progress in the fulfilment of the
conditions precedent.
  Virginia                 Sandton
  1 February 2002          1 February 2002
Advisers to Harmony
  JP Morgan Chase Bank
  (Registration number 2001/016069/10)
Sponsor to Harmony
  JP Morgan Equities
  (Registration number 1995/011815/06)
Legal adviser to Harmony
  Cliffe Dekker
Reporting accountants and auditors to Harmony
  PricewaterhouseCoopers Inc.
  Chartered Accountants (SA)
  Registered Accountants & Auditors
  (Registration no. 1998/012055/21)
Advisers to ARM
  BOE Merchant Bank
  A Division of BOE Bank Limited
  Co. Reg. No. 1951/000847/06
Legal adviser to ARM
  Bowman Gilfillan Inc.
  Registration number 1998/021409/21



                                        
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