Pan African Resources PLC
(Incorporated and registered in England and Wales under
Companies Act 1985 with registered number 3937466 on 25 February 2000)
AIM Code: PAF
JSE Code: PAN
ISIN: GB0004300496
("Pan African Resources" or "group" or "company")
UPDATE ON EVANDER GOLD MINING PROPRIETARY LIMITED ("EVANDER MINES")
REFURBISHMENT AND COST OPTIMISATION PROGRAMME AND PROGRESS ON ELIKHULU TAILING
RETREATMENT PLANT ("ELIKHULU") FINANCING
Update on the Evander shaft refurbishment programme and cost optimisation
programme
Shareholders are referred to the announcement of 20 February 2017, in which the
company communicated the suspension of the Evander Mines underground mining
operations to allow for critical refurbishment and maintenance on no. 7 and no.
8 shaft infrastructure. The company is pleased to report that these repairs are
progressing on schedule and are still expected to be completed within the 55
day period previously communicated. During the suspension of the underground
mining operations the processing and tailings retreatment plants have utilised
available plant capacity to continue processing tailings and additional surface
sources.
In conjunction with the refurbishment, Evander Mines management has implemented
a number of initiatives to reduce the Evander Mines underground operation's
fixed cost base, once mining recommences.
Following a productivity and human capital assessment, initiated some time ago,
Evander Mines has concluded a retrenchment agreement (the "agreement") with the
National Union of Mineworkers on 10 March 2017, with the facilitation of the
South African Commission for Conciliation, Mediation and Arbitration. In terms
of this agreement, approximately 30 percent of Evander Mines employees will be
retrenched at an estimated cost of approximately R54 million (US$4.1 million).
These personnel were designated as redundant for Evander Mines to meet
production targets. Pan African Resources wishes to express its gratitude to
the parties involved for the responsible manner in which the retrenchment
agreement was concluded.
In order to minimise the number of job losses, Evander Mines will seek to
re-engage a number of retrenched employees when site activities for Elikhulu
commences.
Progress on Elikhulu financing
On 9 February 2017, the company confirmed the approval by shareholders to
disapply statutory pre-emption rights to allow the company to carry out a
general issue of ordinary shares for cash. Proceeds from any general issue may
or maybe not be used for the construction of Elikhulu. The company can confirm
that it has been seeking out investor support for raising equity to fund the
remaining portion of capital required for the Elikhulu construction.
The company is pleased with the interest it has had from investors and has
built a book of demand that is in excess of the 291,480,983 shares it was given
authority to issue at its shareholder meeting. In terms of the JSE Limited
Listings Requirements, a company cannot issue shares at a price that is in
excess of a 10% discount to the 30 day volume weighted average price, which is
currently at a premium to the current share price in South African rand terms.
Given current market conditions and market volatility, the company has elected
not to complete an equity issuance at this time. The company will however
continue to progress the Elikhulu development from cash and banking facilities,
until the final Elikhulu funding package is secured.
Johannesburg
10 March 2017
Contact information
Corporate Office Registered Office
The Firs Office Building Suite 31, Second Floor
1st Floor, Office 101 107 Cheapside
Cnr. Cradock and Biermann Avenues London
Rosebank, Johannesburg EC2V 6DN
South Africa United Kingdom
Office: + 27 (0) 11 243 2900 Office: + 44 (0) 207 796 8644
Facsimile: + 27 (0) 11 880 1240 Facsimile: + 44 (0) 207 796 8645
Cobus Loots Deon Louw
Pan African Resources PLC Pan African Resources PLC
Chief Executive Officer Financial Director
Office: + 27 (0) 11 243 2900 Office: + 27 (0) 11 243 2900
Phil Dexter John Prior / Paul Gillam
St James's Corporate Services Limited Numis Securities Limited
Company Secretary Nominated Adviser and Joint Broker
Office: + 44 (0) 207 796 8644 Office: +44 (0) 20 7260 1000
Sholto Simpson Matthew Armitt / Ross Allister
One Capital Peel Hunt LLP
JSE Sponsor Joint Broker
Office: + 27 (0) 11 550 5009 Office: +44 (0) 207 418 8900
Julian Gwillim Jeffrey Couch/Neil Haycock/Thomas
Aprio Strategic Communications Rider
Public & Investor Relations SA BMO Capital Markets Limited
Office: +27 (0)11 880 Joint Broker
0037 Office: +44 (0) 207 236 1010
Bobby Morse/Chris Judd
Buchanan Communications
Public & Investor Relations UK
Office: +44 (0) 207 466 5000
http://www.panafricanresources.com/