Anpario Regulatory News (ANP)

14 Dec 2006 13:05

Anglo Platinum Limited14 December 2006 Issuer Long Name : Anglo Platinum LimitedRegistration No. : 1946/022452/06Instrument Alpha Code/Ticker Symbol : AMS; AMSPISIN : ZAE000013181; ZAE000054474 ANGLO PLATINUM AND BAKGATLA-BA-KGAFELA CONCLUDE BEE TRANSACTION 14 December 2006 Anglo Platinum and the Bakgatla-Ba-Kgafela traditional community ("theBakgatla"), are pleased to announce the conclusion of the proposed BEEtransaction, announced on 8 November 2006, in terms of which the Bakgatla hasacquired a 15% interest in Anglo Platinum's Rustenburg Platinum Mines' Unionsection mining and concentrating business ("Union") and interests in theprospecting rights of the Rooderand 46 JQ, portion 2 ("Rooderand") andMagazynskraal 3 JQ ("Magazynskraal") properties. At a Kgotha-Kgothe (or general meeting) of the Bakgatla on 25 November 2006, thecommunity members voted in favour of the transaction. The terms of the concluded transaction are as follows: - The Bakgatla has acquired a 15% equity stake in an operating asset, Union, via an unincorporated joint venture ("the Joint Venture") with effect from 1 December 2006, - The Bakgatla has made a cash contribution of R420 million funded by commercial debt via a loan from Rand Merchant Bank. In the unlikely event that the after tax cash flow from the Bakgatla's share of Union is inadequate to service the loan, Anglo Platinum will lend the Bakgatla an amount limited to Anglo Platinum's share of the after tax cash flow from Union to service the loan, - The Bakgatla, as part of the debt package with Rand Merchant Bank, has taken out forward cover on half of its 15% share of Union's platinum concentrate revenue for an initial 5 year period, - Anglo Platinum will credit the Bakgatla with an initial profit share adjustment of 15% of the net free cash flows of Union from 1 January 2006 to 30 November 2006 less notional interest that would have accrued to Anglo Platinum on the purchase price. The current estimate of the adjustment is approximately R70 million, - The Bakgatla has agreed to convert its entitlement to royalties into equity and in so doing, has cancelled Anglo Platinum's royalty obligation over a portion of Union, more specifically over Portion 2 of the farm Spitskop 410 JQ ("Spitskop"), - The Bakgatla has provided access, through nominal rental leases, to the surface rights required by Union for all future mining and processing activities, - Anglo Platinum and the Bakgatla have established an exploration joint venture to further develop the Magazynskraal property. The Bakgatla's initial stake in the exploration joint venture will be 26%, - Anglo Platinum has ceded a 55% interest in the prospecting rights of Rooderand to the Bakgatla who are strategically well positioned to add value to Rooderand, - Anglo Platinum has made a R45 million loan to the Bakgatla, part of which has been used to repay land debt and the balance will be used to fund community projects, - As security for the R45 million loan, the Bakgatla has pledged its interest in Rooderand to Anglo Platinum and - Anglo Platinum retains the right, at its election, to purchase any concentrate produced from Rooderand and Magazynskraal. This transaction is expected to contribute between 2% and 3% towards AngloPlatinum's achievement of the HDSA ownership participation targets. The pro-forma, unaudited, initial impact of the transaction on Anglo Platinum'searnings for the year ended 31 December 2006 is a once-off loss on formation ofa subsidiary and a BEE compensation charge totalling approximately R218 milliontaking into account the fair value of Union in terms of AC503 - Accounting forBlack Economic Empowerment Transactions and tax recoupment. This accounting lossdoes not take into account the value accruing to Anglo Platinum as a result ofsecuring the unencumbered right to mine the Spitskop property and the surfacerights acquired which together were valued, as part of the negotiatedtransaction, at R210 million. The initial impact of the transaction of approximately R218 million and theestimated profit share associated with the Bakgatla's 15% stake from 1 December2006 of some R20 million were included in the earnings estimates in AngloPlatinum's Trading Statement published on 29 November 2006. The Bakgatla-Ba-Kgafela Traditional Community comprises some 350 000 peopleresident in the greater Pilanesburg area adjacent to Union and comprisesapproximately 47% of Union's labour force. The Bakgatla is the beneficial ownerof portion 1 of Rooderand 46 JQ and has an existing exploration joint venturewith Barrick Gold Corporation on properties contiguous to Magazynskraal. Ralph Havenstein, CEO of Anglo Platinum commenting on the transaction said:"Anglo Platinum is pleased to be able to conclude a sustainable transaction witha truly broad-based and strategically-placed empowerment partner that isintegral to the company's mining operations in the region" Kgosi John Pilane of the Bakgatla said "The Bakgatla look forward to a committed and mutually beneficial relationshipwith Anglo Platinum. This is truly a union with the people of the Pilanesburg" For further information please contact Anglo Platinum Bakgatla-Ba-KgafelaTrevor Raymond Kgosi John Pilane+27 (0)11 373 6462 +27 (0) 83 719 9760+27 (0) 82 654 8467 This information is provided by RNS The company news service from the London Stock Exchange