Namakwa Diamonds Limited Circular and Notice of Meeting (5383Y)

TIDMNAD

RNS Number : 5383Y

Namakwa Diamonds Limited

25 February 2013

25 February 2013

Namakwa Diamonds Limited (AIM: NAD)

("Namakwa Diamonds" or the "Company")

Circular posted to shareholders regarding cancellation of admission to AIM

The Company announces that it has posted a circular to shareholders and convened a Special General Meeting to be held at the offices of Taylor Wessing LLP at 5 New Street Square, London EC4A 3TW at 10:30 a.m. on 12 March 2013 to propose a special resolution (the "Resolution") to approve the cancellation of admission of the Ordinary Shares to trading on AIM (the "Cancellation"). The expected timetable for the Cancellation is set out below:

 
 Record date for entitlement           6:00 p.m. on 22 February 2013 
  to receive notice of, attend 
  and vote at the Special General 
  Meeting 
------------------------------------  ------------------------------ 
 Posting of this circular and          25 February 2013 
  Form of Direction and/or Form 
  of Proxy to Shareholders 
------------------------------------  ------------------------------ 
 Publication of notice of the          25 February 2013 
  Special General Meeting in the 
  Royal Gazette newspaper in Bermuda 
------------------------------------  ------------------------------ 
 Latest time and date for receipt      10:30 a.m. on 9 March 2013 
  of Forms of Direction 
------------------------------------  ------------------------------ 
 Latest time and date for receipt      10:30 a.m. on 10 March 2013 
  of Forms of Proxy 
------------------------------------  ------------------------------ 
 Special General Meeting               10:30 a.m. on 12 March 2013 
------------------------------------  ------------------------------ 
 Last day for trading of the           22 March 2013 
  Ordinary Shares on AIM 
------------------------------------  ------------------------------ 
 Cancellation of admission to          With effect from 7:00 a.m. on 
  trading of Ordinary Shares on         25 March 2013 
  AIM 
------------------------------------  ------------------------------ 
 

Notes:

   (1)        References to times in this announcement are to times in London unless otherwise stated. 

(2) If any of the above times and/or dates change, the revised times and/or dates will be notified to Shareholders by announcement through a Regulatory Information Service.

Background to the Cancellation

On 7 February 2013, the Company announced that it had received notice from Jarvirne Limited and Sputnick Limited (the "Majority Shareholders") (who, as far as the Company is aware, together are beneficially interested in 825,200,275 Ordinary Shares equivalent to 75.07% of the issued share capital of the Company) requesting that a special general meeting of the Company be held to seek approval of its Shareholders to cancel admission of the Company's Ordinary Shares to trading on AIM.

The Majority Shareholders have confirmed to Namakwa that they will vote in favour of the Resolution and, in light of this and the Company's understanding as to their shareholdings, it is clear that the Resolution would be passed.

The Resolution now being proposed at the Special General Meeting (which is to be held on 12 March 2013) will require the approval of not less than 75% of those Shareholders (being entitled to do so) voting in person or by proxy at the Special General Meeting.

As stated above, the Majority Shareholders:

   --    are understood to hold more than 75% of the Ordinary Shares; and 
   --    have indicated they will vote in favour of the Resolution. 

This means that the Resolution will be passed in any circumstances assuming that the Majority Shareholders vote in the way they have confirmed they intend to.

The Company is incorporated in Bermuda. As a result, the provisions of the City Code do not apply to the Company and Shareholders are not entitled to the protections afforded by the City Code.

Independent Committee

As Messrs. Holden and Kravets were nominated as Directors of the Company by Jarvirne Limited, the Board formed a Committee of Directors unconnected to the Majority Shareholders (consisting of Melissa Sturgess, Robert Reid and Craig Campbell) ("Independent Committee") in order to deal with all matters relating to the Cancellation.

Effect of the Cancellation on Shareholders

The principal effects of the Cancellation, if approved, would be:

-- there would no longer be a formal market mechanism enabling Shareholders to trade their Ordinary Shares and no price will be publicly quoted for the Ordinary Shares. As such, holdings of Ordinary Shares would be unlikely to be easily capable of sale and would be difficult to value;

-- the Company would not be bound to announce material events, nor to announce interim results. Further, the Company will not be bound by the AIM Rules; and

-- the Bermuda Monetary Authority exemption applicable to the Company (permitting transfers of Ordinary Shares without being subject to the Bermuda corporate service provider's know your client ("KYC") processes) would no longer apply to the issue or transfers of Ordinary Shares. Accordingly, Shareholders would, subject to certain exemptions, be likely to be required to follow certain additional procedures in respect of the transfer or issue of Ordinary Shares by or to them. Further details are contained in the circular.

Governance following the Cancellation

Notwithstanding the Cancellation, the Company would continue to be obliged to publish annual reports and accounts and hold Annual General Meetings and other Special General Meetings in accordance with Bermuda law and its existing Bye-laws.

Share trading facility following Cancellation

The Independent Committee is aware that, following the proposed Cancellation, Shareholders may still wish to dispose of their Ordinary Shares and understands that the Majority Shareholders may seek to enter into discussions with third party providers in connection with the potential to establish and maintain a matched bargain settlement facility. Further information regarding any such matched bargain settlement facility, once available to the Board, will be made available to Shareholders on the Company's website.

Record Date

To be entitled to attend and vote at the Special General Meeting (and for the purpose of the determination by the Company of the votes that may be cast), Shareholders must have been registered on the register of members at 6:00 p.m. on 22 February 2013 (or, in the event of any adjournment, on the date which is two days before the time of the adjourned meeting). Changes to the register of members after the relevant deadline shall be disregarded in determining the rights of any person to attend and vote at the meeting.

Special General Meeting

Notice convening the Special General Meeting, to be held at the offices of Taylor Wessing LLP at 5 New Street Square, London EC4A 3TW at 10:30 a.m. (London time) on 12 March 2013, has been circulated to the Shareholders.

The Resolution in the notice proposes the Cancellation. Under the AIM Rules, it is a requirement that any cancellation of shares to trading on AIM must be approved by not less than 75% of votes cast by shareholders at a general meeting. Accordingly, the Resolution is proposed as a special resolution of the Company and, as such, it requires the approval of not less than 75% of the votes cast by Shareholders (being entitled to do so) voting in person or by proxy at the Special General Meeting. The Majority Shareholders (who are understood to hold between them, in aggregate, over 75% of the Ordinary Shares) have indicated to the Company that they intend to vote in favour of the Resolution.

The Company has notified the London Stock Exchange of the proposed Cancellation and, subject to Shareholder approval, it is expected that the cancellation of the admission of the Company's Shares to trading on AIM will be effective from 7:00 a.m. on 25 March 2013.

Recommendation

Given the understanding that the Majority Shareholders hold, in aggregate, over 75% of the Ordinary Shares and have indicated to the Company their intention to vote in favour of the Resolution, the Independent Committee believes that it is in the best interests of the Company that the Special General Meeting be called to consider and, if the Shareholders deem appropriate, approve the Resolution, and make no further recommendations in respect of the Cancellation or the related Resolution.

Definitions

The following definitions apply throughout this announcement unless the context otherwise requires:

 
 AIM                           the AIM market operated by the 
                                London Stock Exchange 
----------------------------  -------------------------------------- 
 AIM Rules                     The AIM Rules for Companies 
                                whose securities are admitted 
                                to trading on AIM, as published 
                                by the London Stock Exchange 
                                from time to time 
----------------------------  -------------------------------------- 
 Bye-laws                      the bye-laws of Namakwa 
----------------------------  -------------------------------------- 
 Cancellation                  the cancellation of admission 
                                of the Ordinary Shares to trading 
                                on AIM becoming effective in 
                                accordance with Rule 41 of the 
                                AIM Rules 
----------------------------  -------------------------------------- 
 City Code                     The UK City Code on Takeovers 
                                and Mergers 
----------------------------  -------------------------------------- 
 CREST                         the system of paperless settlement 
                                of trades and the holding of 
                                uncertified shares of which 
                                Euroclear UK & Ireland Limited 
                                is the operator 
----------------------------  -------------------------------------- 
 Company or Namakwa            Namakwa Diamonds Limited 
----------------------------  -------------------------------------- 
 Depository                    Capita IRG Trustees Limited 
----------------------------  -------------------------------------- 
 Depository Interests          the dematerialised depository 
                                interests in respect of and 
                                representing on a one-for-one 
                                basis Ordinary Shares issued 
                                by the Depository 
----------------------------  -------------------------------------- 
 Depository Interest Holders   holders of Depository Interests 
  or DI Holders 
----------------------------  -------------------------------------- 
 Directors or Board            the directors of the Company 
----------------------------  -------------------------------------- 
 Form of Direction             the form of direction for use 
                                by DI Holders in relation to 
                                voting on the Resolution to 
                                be proposed at the Special General 
                                Meeting 
----------------------------  -------------------------------------- 
 Form of Proxy                 the form of proxy for use by 
                                Shareholders in relation to 
                                voting on the Resolution to 
                                be proposed at the Special Meeting 
----------------------------  -------------------------------------- 
 Independent Committee         an independent committee of 
                                the Board comprising Melissa 
                                Sturgess, Robert Reid and Craig 
                                Campbell 
----------------------------  -------------------------------------- 
 London Stock Exchange         London Stock Exchange plc 
----------------------------  -------------------------------------- 
 Ordinary Shares               the ordinary shares of US$0.000625 
                                each in the capital of the Company 
----------------------------  -------------------------------------- 
 Shareholder or Shareholders   the holder(s) of Ordinary Shares 
                                and/or, as the context may require, 
                                holder(s) of Depository Interests 
                                representing Ordinary Shares 
----------------------------  -------------------------------------- 
 Special General Meeting       the Special General Meeting 
                                of the Company to be held at 
                                the offices of Taylor Wessing 
                                LLP at 5 New Street Square, 
                                London, EC4A 3TW at 10:30 a.m. 
                                on 12 March 2013, or any adjournment 
                                thereof 
----------------------------  -------------------------------------- 
 

Enquiries:

 
 Namakwa Diamonds                            Shore Capital 
 Theo Botoulas        [phone]        Pascal Keane   [phone] 
 
 Tavistock Communications 
 Simon Hudson/Kelsey 
  Traynor                 [phone] 
 
 

About Namakwa Diamonds Limited

Namakwa is a diamond resource group, which seeks to extract maximum value from the marketing and sale of Group mined and contracted production.

The Group's mining activities are focused on the Kao mine in Lesotho. Operated by Storm Mountain Diamonds, the Kao Main Pipe Complex represents a resource endowment of c.183Mt of kimberlite ore containing c.11.6M carats ("cts") (3.3Mcts Indicated and 8.3Mcts at Inferred levels of confidence), with an additional c.1.7Mcts at a Deposit level of confidence, in which Namakwa holds a 62.5% interest. The other shareholders are the Government of Lesotho (25%) and Kimberlite Investments Lesotho Limited (12.5%).

The Group also maintains alluvial mining operations in the North West Province of South Africa and resource-development and exploration assets in the Northern Cape Province of South Africa and in the offshore marine environment of Namibia. These combined resources add a further c.6.9Mcts at Indicated and Inferred levels of confidence to the Group's Global Resource Inventory which stands at 18, 535, 700 carats as at 31 August 2012. Namakwa is listed on the AIM market of the London Stock Exchange under the ticker symbol NAD.

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This information is provided by RNS

The company news service from the London Stock Exchange

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