Proposed Acquisition of Braemore Resources Plc

 

TIDMJLP TIDMBRR 
 
RNS Number : 0824V 
Jubilee Platinum PLC 
03 July 2009 
 

 
 
(A company incorporated in England and Wales with Registration number: 4459850) 
ISIN: GB0031852169 
JSE Share Code: JBL / AIM Share Code: JLP 
 
 
 
 
Jubilee Platinum plc 
 
 
("Jubilee") 
 
 
 
PROPOSED ACQUISITION OF THE ENTIRE ISSUED AND TO BE ISSUED SHARE CAPITAL OF 
BRAEMORE RESOURCES PLC ("BRAEMORE) AND WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT 
 
 
1.    INTRODUCTION 
 
 
Further to the Jubilee cautionary announcement on 29 June 2009 Jubilee wishes to 
announce that it has entered into an implementation agreement (the 
"Implementation Agreement") dated 2 July 2009  with  Braemore in terms of which 
it will make an offer by way of a scheme of arrangement (the "Scheme") in 
accordance with Part 26 of the UK Companies Act of 2006, as amended (the "Act"), 
to be proposed by Jubilee between Braemore and its shareholders in terms of 
which Braemore will become a wholly owned subsidiary of Jubilee and Braemore's 
listing on AIM (a market operated by the London Stock Exchange plc) and on the 
JSE Limited ("JSE") will be cancelled (the "Transaction"). 
 
 
In implementing this agreement, Jubilee has now extended the previous agreement 
with Braemore announced  on 29 May 2009 into ownership based on Jubilee's 
strategy to become an emerging total capability platinum producer. 
 
 
 
2.    TERMS OF THE SCHEME, RATIONALE AND RELATED MATTERS 
 
 
Certain terms of the Scheme, the rationale, and certain related matters 
including the advancing of working capital funding by Jubilee to Braemore are 
set out in the joint announcement by Jubilee and Braemore released 
simultaneously with this announcement. Jubilee shareholders are referred to that 
announcement which should be read in conjunction with this announcement. 
 
3.    INFORMATION ON BRAEMORE 
 
 
Braemore is listed both on AIM and the JSE, its focus being on the smelting and 
refining of nickel and platinum group metal concentrates. It has projects in 
both Australia and South Africa and a smelting facility located at Mintek in 
South Africa. 
 
 
In South Africa, a subsidiary of Braemore has an exclusive licence agreement to 
use an alternative roasting and smelting process ("ConRoast") developed by 
Mintek. This ConRoast process is particularly amenable for the treatment of 
platinum group metal (PGM) concentrates with elevated chrome that traditionally 
are difficult to process by the conventional smelting methods used by the major 
platinum companies. 
 
 
This ConRoast process will now be available for use in the South African 
platinum mining industry for utilization by emerging primary platinum producers 
and those companies involved in the re-treatment of dumps for recovery of PGMs. 
It has the potential to be captive to operations with a relatively modest 
electrical power requirement compared to major smelters. 
 
 
In Australia, Braemore holds tailings supply agreements with BHP Billiton on 
three nickel surface dumps in Leinster, Kambalda and Mt Keith containing a 
combined estimated total of some 500,000 tons of nickel. 
 
 
Braemore presently has a market capitalisation of approximately R505 million. 
 
 
 
4.FINANCIAL EFFECTS ON JUBILEE 
 
 
The table below sets out the unaudited pro forma financial information of the 
Scheme per Jubilee share which have been prepared in accordance with IFRS, based 
on the published unaudited interim results of both Jubilee and Braemore for the 
six month period ended 31 December 2008. The preparation of unaudited pro forma 
financial information is the responsibility of the Jubilee directors and 
is provided for illustrative purposes only, to provide information about how the 
Scheme may have affected Jubilee shareholders. Due to the nature of unaudited 
pro forma financial information, it may not be a true reflection of the impact 
of the Scheme on future earnings or Jubilee's financial position: 
 
 
+--------------------------+---------------------+---------------------+----------------+ 
|                          | Before the Scheme   | After the Scheme    | Percentage     | 
|                          |                     | assuming an equity  | Change         | 
|                          |                     | consideration of    |                | 
|                          |                     | 1 new Jubilee       |                | 
|                          |                     | share for every     |                | 
|                          |                     | 15.818 Braemore     |                | 
|                          |                     | shares is paid      |                | 
+--------------------------+---------------------+---------------------+----------------+ 
|                          | 1 Jubilee share     | to Braemore         | Per Jubilee    | 
|                          |                     | shareholders        | share          | 
+--------------------------+---------------------+---------------------+----------------+ 
| Earnings (pence)         |              (0.37) |               12.17 |       3 390.4% | 
+--------------------------+---------------------+---------------------+----------------+ 
| Headline earnings        |              (0.37) |              (3.03) |         719.7% | 
| (pence)                  |                     |                     |                | 
+--------------------------+---------------------+---------------------+----------------+ 
| Net asset value (pence)  |               32.71 |               51.68 |         58.04% | 
+--------------------------+---------------------+---------------------+----------------+ 
| Tangible net asset value |                8.63 |                7.52 |        (12.9%) | 
| (pence)                  |                     |                     |                | 
+--------------------------+---------------------+---------------------+----------------+ 
| Number of shares in      |         113 013 291 |         163 001 844 |          44.2% | 
| issue                    |                     |                     |                | 
+--------------------------+---------------------+---------------------+----------------+ 
| Weighted average number  |         108 150 721 |         158 139 274 |          46.2% | 
| of shares in issue       |                     |                     |                | 
+--------------------------+---------------------+---------------------+----------------+ 
 
 
Notes: 
 
 
The financial effects are indicative only and have been based on the assumptions 
set out below. 
 
1. The "Before the Scheme" reflects the published unaudited interim financial 
results of Jubilee for the six months ended 31 December 2008 
 
2. For the purposes of calculating earnings per share and headline earnings per 
share, "After the Scheme" for the six months ended 31 December 2008, it was 
assumed that: 
  *   The scheme became operational and was affected in full with effect from 1 July 
  2008 
 
  *  The scheme consideration is settled through the issue of 49,988,553 Jubilee ordinary shares (1 new Jubilee share for every 15.818 Braemore shares held by Braemore shareholders ) with effect from 1 July 2008 (based on 788.2 million Braemore shares in issue and on the assumption that 1,385,899 options held by Nabarro Wells with an exercise price of 1 pence have been exercised)
 
3. For the purposes of calculating the net asset value per share and tangible 
net asset value per share, "After the Scheme", it was assumed that: 
  *  The transaction was implemented on 31 December 2008 for balance sheet purposes; 
  *  Share capital and share premium have been adjusted to reflect the issue of 
  49,988,553 Jubilee ordinary shares (1 new Jubilee share for every 15.818 
  Braemore shares held by Braemore shareholders ); and 
  *  The estimated transaction costs of GBP600.000 have been written off against 
  share premium. 
 
 
4. The percentage change has been calculated on rounded numbers. 
 
5. CATEGORISATION OF THE TRANSACTION 
 
 
The Transaction is categorized as a Category 1 transaction in terms of the JSE 
Listings Requirements and accordingly will require, inter alia, the approval of 
Jubilee shareholders in general meeting. A circular incorporating a notice of 
general meeting is in the course of preparation and will, subject to regulatory 
approvals, be posted to shareholders within 28 days from the date of this 
announcement. 
 
 
 
6. WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT 
 
 
The Jubilee cautionary announcement dated 29 June 2009 is hereby withdrawn. 
 
 
Johannesburg 
3 July 2009 
 
 
 
 
 
 
Legal adviser to Jubilee in the UK: Fasken Martineau 
Legal adviser to Jubilee in South Africa    Eversheds 
Nominated adviser to Jubilee:              Finncap 
Sponsor to Jubilee:                        Sasfin 
 
 
 
 
Certain statements in this announcement constitute "forward-looking statements". 
These statements, which contain the words "anticipate", "believe", "intend", 
"estimate", "expect" and words of similar meaning, reflect the beliefs and 
expectations of the Jubilee directors and are subject to risks and uncertainties 
that may cause actual results to differ materially. These risks and 
uncertainties include, among other factors, changing business or other market 
conditions and the prospects for growth anticipated by the management of 
Jubilee. These and other factors could adversely affect the outcome and 
financial effects of the plans and events described herein. As a result, you are 
cautioned not to place undue reliance on such forward-looking statements. 
Jubilee and its advisers and each of their respective members, directors, 
officers and employees disclaim any obligation to update their view of such 
risks and uncertainties or to publicly announce the result of any revision to 
the forward-looking statements made herein, except where it would be required to 
do so under applicable law. 
 
 
Nothing in this announcement is intended, or is intended to be construed, as a 
forecast, projection or estimate of the future financial performance of Jubilee, 
Braemore or the enlarged group. 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
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