Following the merger between Shanduka Group and the Pembani Group last year, the direct shareholding in Shanduka Gold is held by the following entities:
- The Mabindu Business Development Trust (49.5%);
- Jadeite Limited (33.6%); and
- The Standard Bank of South Africa (16.9%).
The value of the sale shares may be determined with reference to the 16.9% sale share’s pro rata interest, net of liabilities, in the Pan African shares held by Shanduka Gold (32.8%). [quote]
This value is further augmented pursuant to a notional vendor financing arrangement attached to the Shanduka Gold shares held by Mabindu.
The acquisition purchase consideration will be settled in cash at a discount to the prevailing Pan African share price and considers valuation adjustments ordinary to a transaction of this nature and will be paid for from existing cash resources and facilities.
The company said that the acquisition will not affect its operations or its ability to continue paying dividends.
Shanduka Gold is Pan African’s primary black economic empowerment shareholder with its sole asset being a 23.8% interest in the issued share capital of Pan African. Following the merger, Pan African engaged with the Shanduka Gold shareholders to establish a structure through which the existing relationship between the company and Shanduka Gold may be preserved.
The Acquisition represents a unique opportunity for Pan African to enhance shareholder value by indirectly investing in its own shares via Shanduka Gold whilst pro-actively reducing the potential risk of future shareholder value dilution that could arise if the existing Shanduka Gold structure were to be dissolved.
Pan African Resources reported improved operating and financial performance, underpinned by the stronger prevailing rand gold price environment for the six months ended 13 December 2015.
Highlights during this period include:
- Increase in group earnings by 129.4% to R227.6 million from R99.2 million
- Increase in gold sales by 17.4% to 101 797 oz from 86 675 oz
- Substantial improvement in net debt to R345.8 million from R458.6 million
- The effective rand gold price received increased by 11.7% to R485 215/kg
- All-in cost per kilogramme decreased to R397 692/kg from R453 068/kg
- All-in sustaining cost per kilogramme decreased to R396 819/kg from R411 384/kg