27th Oct 2008 07:02
AQUARIUS PLATINUM LIMITEDASX, LSE & JSE27 October 2008
Aquarius Completes Final Phase of Black Economic Empowerment, Resulting in a Simpler, Earnings Enhancing Corporate Structure
Aquarius Platinum Limited (Aquarius) is pleased to announce today that it has completed the final phase of its South African Black Economic Empowerment (BEE) transaction with the Savannah Consortium (SavCon). SavCon will exchange, as originally envisaged and agreed, its 32.5% shareholding in Aquarius' principle South African operating subsidiary, Aquarius Platinum (South Africa) (Proprietary) Limited (AQPSA), into 65,042,856 new shares in AQP, comprising approximately 20% of the enlarged share capital of Aquarius. Subsequently, Aquarius will hold 100% of AQPSA, providing a modest boost to earnings. Following the take out of other minorities earlier in the year in Aquarius and AQPSA, Aquarius will also continue to enjoy a 100% free-float.
Commenting on the transaction, Stuart Murray, CEO of Aquarius Platinum said: "When we embarked on empowering Aquarius six years ago, it was always with the long-term conversion of our BEE investor's interest into Aquarius shares that we had in mind. SavCon have enabled our business to grow, both in the most simple sense with the funding of the Everest Mine, but also in a wider sense through their on-going contribution at every level of our business. This final phase of the empowerment journey is therefore pleasing as it sees the BEE investors rewarded for their contribution with a sizeable shareholding in Aquarius, and following other corporate transactions, in turn sees Aquarius enjoy 100% ownership of its principal South African operating assets."
Commenting on behalf of SavCon, Zwelakhe Mankazana, a director of Savannah Resources (Pty) Limited said: "The SavCon partnership with Aquarius has been ground-breaking in every sense and we believe has delivered empowerment in the true spirit intended by South Africa's mining legislation and Government policy. As a direct consequence of the Empowerment transaction SavCon concluded with Aquarius and AQPSA, the cash from our investment was used to build the Everest Mine where today 1,700 people are employed. Furthermore, we have spearheaded transformation within the AQPSA businesses as required by the mining legislation. The fact that AQPSA was one of the first South African platinum producers to be granted fully converted mining rights within a relatively short period of time after the conclusion of the SavCon transaction with AQPSA, is testament to the pragmatism of implementing genuine empowerment in South Africa's mining industry. For SavCon to become a shareholder in Aquarius is the culmination of our original strategic intent to pioneer the achievement, by previously disadvantaged South Africans, of holding significant equity and exerting influence on a foreign listed platinum producer that conducts its business on African soil. SavCon will continue to be a long-term investor in Aquarius."
Background
Four years ago, and after an almost two year process, in October 2004, Aquarius shareholders approved the acquisition of a 29.5% stake in AQPSA for a price of R860 million by SavCon, a consortium of BEE Investors comprising of Savannah Resources, Chuma Holdings and the Malibongwe Women's Development Organisation. At the time it was agreed that subject to South African Reserve Bank approval and the conversion of AQPSA's old order rights to new order rights in accordance with the requirements of South African mining legislation, SavCon's shareholding in AQPSA would be converted to 24,599,542 new Aquarius shares, representing at the time, approximately 23% of the enlarged share capital of Aquarius. At this time, Aquarius held 50.5% of AQPSA, with the balance being held 29.5% by SavCon and 20% by Impala Platinum.
Following the granting of new order mining rights in October 2006, in November 2006 Aquarius bought back 3.5% of AQPSA from SavCon, thereby reducing SavCon's holding in AQPSA to 26% and increasing AQP's shareholding in AQPSA to 54%, with a consequential proportional reduction in the number of flip-up shares in AQP to be ultimately acquired by SavCon, to 21,680,952. At this time, the balance of 20% of the shares in AQPSA was held by Impala.
In November 2007, shareholders approved a 3-for-1 share split in AQP, thereby increasing the number of shares under the BEE conversion threefold to 65,042,856.
In April 2008, AQPSA repurchased Implats' 20% stake in AQPSA. Following the transaction Aquarius' shareholding in AQPSA increased from 54% to 67.5% and SavCon's shareholding increased from 26% to 32.5%. This buy back did not impact upon the number of conversion shares available to SavCon, which remained fixed at 65,042,856.
Approval of the Reserve Bank of South Africa has been obtained for the exchange of shareholdings to occur, for the new Aquarius shares to be held indefinitely by SavCon and the parties to the transactions have obtained the necessary opinions that AQPSA shall, notwithstanding the flip, continue to qualify as the holder of all its new order rights. Passing these final hurdles, therefore, paved the way for the flip-up of SavCon's now 32.5% interest into 65,042,856 new shares in Aquarius, approximately 20% of the enlarged share capital of the group.
Transaction Structure
A total 65,042,856 new shares will be issued to SavCon on 27 October 2008 in full consideration for its 32.5% holding in AQPSA. The shares will be credited as fully-paid and will rank pari-passu in all respects with the existing issued ordinary shares of the Company.
The trading of shares by the new beneficial owners is unrestricted but must take place in an orderly manner, demonstrating the true creation and transfer of value under empowerment and the strong relationship enjoyed between Aquarius and its BEE investors. The shares will be placed on the South African register of the Company.
Following the share exchange, Aquarius will own 100% of AQPSA. The Issued Capital of the company will increase by 65,042,856 to 327,095,634 fully paid common shares and 1,680,305 unlisted options and the free float will be 100%.
For further information please contact:
In Australia:Willi Boehm+61 (0)8 9367 5211
In the United Kingdom and South Africa:
Nick Bias
+44 (0)7887 920 530
REGISTERED OFFICE
Aquarius Platinum Limited ¢â€" Clarendon House ¢â€" 2 Church Street ¢â€" Hamilton HMCX Bermuda
Email: [email protected]
Telephone: +61 8 9367 5211Email:Telephone: +61 8 9367 5211
vendorRelated Shares:
AQP.L