JOHANNESBURG, South Africa, Sept. 7, 2004 (PRIMEZONE) -- Impala Platinum Holdings Limited (Implats) (Pink Sheets:IMPUY) (JSE:IMP) (LSE:IPLA) (ADR:IMPUY): confirms that today, September 7, 2004, it together with Lonmin Plc, the Industrial Development Corporation and a consortium of broad-based empowerment entities, signed the documentation giving effect to the transaction to sell its 27.1% stake in Lonmin's operating subsidiaries, Western Platinum Limited and Eastern Platinum Limited (together referred to as Lonplats).
This follows the initial announcement a year ago that Implats had signed a memorandum of understanding regarding the sale of its stake in Lonplats to Lonmin and a grouping of black empowerment consortia for US$800 million. It was further announced in May 2004 that Implats would simultaneously sell 9% of Lonplats to a consortium of historically disadvantaged South Africans (HDSAs) for US$240.1 million and 18.1% to Lonmin for US$554.5 million, for a total price of US$794.5 million. As an indivisible part of this transaction, the HDSA consortia and Lonmin will each immediately sell 9% of Lonplats to the newly formed black-owned and -controlled mining company, Incwala Platinum (Pty) Limited (Incwala Platinum). In addition, Implats is to provide vendor financing of US$95 million out of a total of US$122 million.
Keith Rumble CEO of Implats notes: "Through the sale of our stake in Lonplats, Implats is proud to have been key to the establishment of a new black mining company Incwala Resources (Pty) Limited and its wholly owned subsidiary, Incwala Platinum. We have also played a significant role in the provision of 78% of the vendor financing, at minimal risk to our shareholders.
"This transaction enables us to meet some of the requirements of the Mining Charter and the Department of Mineral and Energy (DME) has indicated that, as presented, this transaction is in line with the requirements of the new mining law. Although the DME will only evaluate compliance with the legislation once we formally apply for conversion to new order mining rights, it has acknowledged that, having both facilitated this transaction, Implats and Lonmin will be allocated credits proportional to the percentages and ounces they have sold to their BEE partners. We anticipate that in Impala Platinum's hands this will equate to credits of 9%.
"Furthermore, the Implats' board is satisfied that the transaction yields value for shareholders. The cash flow received from this transaction will be used to fund Implats' capital requirements at its operations in both South Africa and Zimbabwe. Surplus cash will be returned to shareholders."
The signing today is a prelude to the ultimate conclusion of the sale which is expected within weeks, at which time Implats will receive payment for the sale.