1. RIO TINTO AND ANGLO AMERICAN DIVESTMENT

Transcription

1 PALABORA MINING COMPANY LIMITED (Incorporated in the Republic of South Africa) Registration number 1956/002134/06 JSE Code: PAM ISIN: ZAE ("Palabora" or "the Company") ANNOUNCEMENT PERTAINING TO: IMPLEMENTATION OF THE RIO TINTO GROUP ("RIO TINTO") AND ANGLO SOUTH AFRICA CAPITAL PROPRIETARY LIMITED'S ("ANGLO AMERICAN") AGREEMENT ("RIO/ANGLO SALE AGREEMENT") TO SELL THEIR RESPECTIVE EFFECTIVE SHAREHOLDINGS IN PALABORA ("RIO TINTO AND ANGLO AMERICAN DIVESTMENT"); CHANGE IN DIRECTORATE; AND UPDATE TO CAUTIONARY ANNOUNCEMENT. 1. RIO TINTO AND ANGLO AMERICAN DIVESTMENT Shareholders of Palabora ("Shareholders") are referred to the announcements published on the Stock Exchange News Service of the JSE Limited ("SENS") on 11 December 2012 and 28 December 2012, and the renewal of/update to cautionary announcements published on 12 February 2013, 27 March 2013, 13 May 2013, 1 July 2013, 5 July 2013 and 18 July 2013 ("Cautionary Announcements"), regarding the conclusion of the Rio/Anglo Sale Agreement between Rio Tinto, Anglo American and a consortium of purchasers comprising South African and Chinese entities led by the Industrial Development Corporation of South Africa SOC Limited and Hebei Iron & Steel Group Co. Ltd. ("Consortium"). Shareholders are advised that the Rio Tinto and Anglo American Divestment was implemented on 31 July This has resulted in the Consortium acquiring, directly and indirectly, 74.5% of the issued share capital of the Company. As a result, and as previously advised, the Consortium is required to extend an offer to all remaining Shareholders to acquire their ordinary shares in Palabora ("Mandatory Offer"), which offer Shareholders may accept as to all or a portion of their Palabora ordinary shares ("Shares"). It is Palabora s understanding that an announcement by the Consortium of its firm intention to make such Mandatory Offer will be made on 1 August Pursuant to the Mandatory Offer, and subject to and in accordance with the requirements of the Companies Act, 71 of 2008, as amended, and the Fundamental Transactions and Takeover Regulations contained in Chapter 5 of the Companies Regulations, 2011, as amended ("Companies Regulations"), Palabora understands that Shareholders are to be offered a consideration of ZAR 110 per Share, plus an additional ZAR 5.95 per Share, being a non-compounding escalation amount of 5% per annum calculated over the period from 1 July 2012 up to, but excluding, the closing date of the Rio Tinto and Anglo American Divestment, being 31 July Note that this announcement by Palabora does not constitute the firm intention announcement in respect of the Mandatory Offer required to be made by the Consortium in accordance with Regulation 101(1) of the Companies Regulations. 2. CHANGES IN DIRECTORATE In compliance with paragraph 3.59 of the JSE Limited Listings Requirements, the board of directors of Palabora ("Board") advises Shareholders that the following changes to the composition of the Board have taken place:

2 Pursuant to the implementation of the Rio Tinto and Anglo American Divestment, with effect from 31 July 2013, Messrs Craig Kinnell, Jean-Sabastien Jacques (and his alternate, Eric Yan), Hendrick Faul (all non-executive directors) and the Managing Director, Anthony Lennox, have resigned. The Board would like to thank the outgoing directors for their valuable contribution and, in particular, Mr Lennox for guiding Palabora through the Lift II order of magnitude and pre-feasibility studies, magnetite growth, smelter study and the vermiculite business. The Board is pleased to announce the appointment of the following directors and alternate directors on 31 July 2013: a) Mr Jinghua Han: Mr. Han is the Vice President of Chengde Iron & Steel Group Co. Ltd., a subsidiary of Hebei Iron & Steel Group Co. Ltd. ("HBIS"). He was born in May 1963, and started his career with HBIS in July 1985 where he joined Handan Iron & Steel Co. Ltd. (now a subsidiary of HBIS). He graduated from Hebei Mechanical and Electricity Institute, where he majored in Industrial Electricity and Automation. Mr. Han obtained his MBA degree in 2008 from Beijing Jiaotong University. Mr. Han worked for Handan Iron & Steel Co. Ltd. from 1985 to 2008 where he served in a variety of positions, including General Manager of Steel Casting & Rolling Plant. He then served as the Vice President of Chengde Vanadium and Titanium Co. Ltd. (a subsidiary of HBIS) from 2008 to In May 2010, he was promoted to be the Vice President of Chengde Iron & Steel Group Co. Ltd., and is in charge of sales and marketing. Mr Han is appointed to the Board as a non-executive, non-independent director. b) Mr Jie Yan Mr Yan is Director General of Enterprise Management Division of Tewoo Group, the largest state owned enterprise in the Tianjin Municipality in China. He was born in 1963, and started his business career in 1983 after graduating from the Tianjin University of Broadcasting and Television. He subsequently also graduated from the Graduate School of Party School of the Central Committee of Communist Party of China in Mr Yan served in the Finance and Auditing Department at Tianjin Material Management Bureau from 1983 to 1993, and was then transferred to the State Owned Asset Operation Division of Tianjin Material Group in He was promoted in 1999 to be the Deputy Director General of the State Owned Asset Operation Division of Tianjin Material Group, and then further promoted to be the Director General of the Enterprise Development Division of Tianjin Material Group (later renamed the Tewoo Group Co. Ltd.) in Mr Yan is appointed to the Board as a non-executive, non-independent director. c) Mr Zejun Tian Mr Tian is the General Manager of Hebei Iron & Steel Group International Trade Corporation, based in Beijing. He was born in 1965, and joined HBIS in 1988 after graduating from Xian Metallurgical and Construction Institute, where he majored in Mineral Processing. He obtained his MBA degree in 2008 from the University of Texas, Arlington, located in the United States of America.

3 Mr Tian started his career with HBIS at one of its iron ore mines, and was promoted in 1997 to be the Deputy Manager of the Miaogou Iron Ore Mine of Tangshan Iron & Steel Group Co. Ltd., a subsidiary of HBIS. In 2007, he was promoted to be the Chairman and General Manager of Tangshan Iron & Steel Group Mining Company. In 2009, Mr Tian served as the Assistant to the General Manager of Hebei Iron & Steel Group Mining Company, and held a concurrent position as the General Manager of Laiyuan Nonferrous Metals Company, a subsidiary of HBIS. He was appointed as the General Manager of Hebei Iron & Steel Group International Trade Corporation in February Mr Tian is appointed to the Board as a non-executive, non-independent alternate director to Mr Han. d) Mr Ng Tze For ('Benjamin') Mr Ng is the Chief Financial Officer of General Nice Development Company. He was born in 1961 in Hong Kong, and has more than 25 years' experience in financing and trade. Mr Ng graduated from the Chinese University in Hong Kong with a Bachelor degree in Industry and Commerce, and he obtained his MBA degree from the City University of Hong Kong. Mr Ng has held various executive positions in a number of international banks and listed companies in Hong Kong, Beijing and Shanghai. Mr Ng has acted as Chief Financial Officer of General Nice since He has also served as Executive Director of General Nice Resources (China) Holdings Limited since 2008, as well as Chief Financial Officer of Tian Yi Group, and holds the position of Executive Director of Lee Kee Holdings Group. Mr Ng is appointed to the Board as a non-executive, non-independent alternate director to Mr Yan. e) Mr Abel Patrick Malinga Mr Malinga is the Divisional Executive of Mining and Manufacturing Industries at the Industrial Development Corporation (IDC). He has many years of experience in mining and financial sectors. Mr Malinga has been involved in project development and funding in the resources and agricultural sectors. He has experience in a number of black economic empowerment acquisition transactions, project finance and early equity funding solutions for junior mining companies. Mr Malinga holds a BSc degree from the University of Cape Town (UCT) and Master's Degree in Business Leadership from UNISA. Mr Malinga has headed various business units within the IDC ranging from Franchising to Food, Beverages & Agricultural Industries. He serves as the Chairman of the boards of directors of Algorax Proprietary Limited (a subsidiary of the Evonik Industries (German)) and Umicore Autocat (SA) Proprietary Limited. He also serves on the boards of directors of Kalagadi Manganese and Corridor Sands Limitada (Mozambique). Mr Malinga is appointed to the Board as a non-executive, non-independent director. f) Mr George Maanda Negota Mr Negota previously served as independent non executive director of Palabora from May 1998 and in February 2007 was appointed as Chairman of the Board until Mr Negota is one of the shareholders in Palabora BEE Investment Company (RF) Proprietary Limited, which will hold a 6% shareholding in Palabora Copper Proprietary Limited ("Palabora Copper", Palabora's operating subsidiary), upon the anticipated implementation of Palabora's BBBEE transaction on

4 1 August Mr Negota is also the inaugural nominee on the Board from the BEE shareholders in Palabora Copper. Mr Negota is a practicing attorney, and established a legal firm, Negota Incorporated Attorneys, in June He has conducted a number of commissions of enquiry on behalf of Government. He was in the leadership of Gautrain where he was responsible for BEE and general socio-economic development activities. He is a founder member of South African Long Distance Taxi Association and the former Chairman of the Cross Border Transport Agency. He also served, among others, as Chairman of llizwi Industrial Holdings and Kuthele Project (Pty) Limited. He has BA (Hons) and MCom degrees from the University of Johannesburg, and LLB and BCom (Hons) degrees from Unisa. In addition, Mr Negota holds a Higher Diploma in Tax Law and Higher Diploma in Company Law from Wits University and a Certificate in Tax Law from Unisa. Mr Negota is appointed to the Board as a non-executive, non-independent director. Following the changes to the Board as described above, as at 1 August 2013, the Board is constituted as follows: Directors (i) (ii) (iii) (iv) (v) (vi) (vii) (viii) (ix) (x) (xi) (xii) Clifford N Zungu (Chairman)* Nhlanhla Hlubi* Ray Abrahams* Francine Ann du Plessis* Peter Ward* George Maanda Negota# Zejun Tian# (alternate) Jie Yan# Ng Tze For# (alternate) Jinghua Han# Abel Patrick Malinga# Dikeledi Nakene^ (Chief Financial Officer) * Independent non-executive directors. # Non-executive directors. ^ Executive directors. Interim Chief Executive Officer The Board is in the process of considering the appointment of a Chief Executive Officer (CEO) to fill the position vacated by Mr Lennox. In the interim, the Board is delighted to appoint Mr Maboko Mahlaole as Interim Chief Executive Officer. Mr Mahlaole joined Palabora in September 2010 as General Manager of Human Resources. Mr Mahlaole is not only a professional of people-management, but also has a deep understanding of Palabora's operations and management. 3. UPDATE TO CAUTIONARY ANNOUNCEMENT Shareholders are referred to the Cautionary Announcements and are advised to continue exercising caution when dealing in Palabora's securities until the circular containing details of the Mandatory Offer is posted to Shareholders and a further announcement to this effect is made. Phalaborwa

5 1 August 2013 Sponsor One Capital