Response to convening of general meeting for Lemur

RNS Number : 6692L

Bushveld Minerals Limited

14 August 2013

 



14 August 2013

Bushveld Minerals Ltd.

Response to convening of general meeting for Lemur Resources Ltd

Bushveld Minerals Ltd ("Bushveld" or the "Company") notes the ASX announcements by Lemur Resources Limited ("Lemur") (LMR: ASX) dated 2 and 12 August 2013 in respect of the request by certain Lemur shareholders to convene a general meeting to make certain directorate changes.

The general meeting request was received from JP Morgan Nominees Australia and ACP Investments Pty Ltd who collectively hold 5.43% of the issued share capital of Lemur. In addition to seeking to appoint new directors and remove certain Lemur directors, JP Morgan Nominees Australia and ACP Investments Pty Ltd, have confirmed, in the event the resolutions are successful, the newly elected directors would consider putting a resolution to Lemur shareholders to approve a potential capital return of approximately AU$0.075 cents per Lemur share at a future Lemur shareholder meeting. The meeting will take place on 1 October 2013.

Bushveld announces that it does not support the resolutions and will not support a return of capital to Lemur shareholders, notwithstanding that as a shareholder of Lemur, it would be entitled to cash under the proposed scheme. Bushveld is of the view that applying the funds in Lemur to the value-accretive acquisition of cash-flow producing or near cash-flow producing opportunities with a bias to coal in South Africa is a better long term application of Lemur's funds.   

Bushveld is confident that the proposed resolutions to make directorate changes to the board of Lemur, including the removal of Anthony Viljoen and Fortune Mojapelo (both directors of Bushveld and Lemur), as well as any subsequent resolution to approve a capital return will NOT be successful based on the fact that Bushveld intends to vote all of its Shares against the resolutions at the upcoming meeting and any resolution to make a capital return.

In relation to the proposed return of capital, as noted in Lemur's announcement of 12 August 2013, a capital return is conditional upon the nominee directors being elected, the nominee directors considering in the light of their director duties that a capital return is appropriate in the circumstances and the capital return is approved by a majority of Lemur shareholders.

Based on acceptances to its unconditional takeover offer (Bushveld Offer) received to date, Bushveld holds approximately 16.77% of the Shares in Lemur.  Bushveld has also received confirmations of an intent to accept its takeover offer from certain Shareholders holding Shares representing approximately a further 27.27% of Lemur's issued Shares, in the absence of a superior proposal and subject to escrow restrictions being lifted or ceasing to apply.  The escrow restrictions are scheduled to lift on 24 August 2013.  If these Shareholders accept the takeover offer, Bushveld will have a shareholding of approximately 44.04%.  Lemur is aware that Bushveld does not support a capital return and will vote all of its Shares against the resolutions at the 1 October 2013 meeting.

Bushveld continues to urge Lemur shareholders to seriously consider the merits of accepting the Bushveld Offer and consequently to benefit from the exposure to a diversified portfolio of attractive commodity platforms, including Lemur with an attractive value-accretive strategy managed by a team with proven capabilities of identifying and developing projects. By accepting the Bushveld offer, Lemur shareholders will also align Lemur's shareholding behind a single strategy aimed at developing a cashflow producing profile.

Commenting on these statements, Mr Fortune Mojapelo, Chief Executive Officer of Bushveld said:

"We do not support the resolutions being put forward by the two Lemur shareholders. We do not believe that these resolutions have sufficient shareholder support to pass. Bushveld has made it clear that it supports the current strategy by Lemur's management and board. This strategy seeks to leverage Lemur's significant balance sheet to acquire cash-flow producing or near producing assets in the domestic coal market in South Africa, which in Bushveld's opinion is a market with significant and under-priced well developed coal assets and yet facing dire shortage of coal supply for domestic power generation. Bushveld believes that the proposed return of capital is significantly inferior to the option of leveraging its balance sheet to not only see out the current depressed market conditions but to also make highly value accretive acquisitions of producing or near producing assets at a steep discount to their invested capital or replacement cost. The Bushveld Offer will assist to ensure that there is alignment in the Lemur shareholder base behind the above stated strategy.  Bushveld is well placed to support this strategy directly as a majority shareholder, given its significant experience identifying and developing assets in this market and its deep network of relationships in the coal industry in South Africa. Moreover, itsmanagement team having been involved in the development of the Imaloto Coal Project will also ensure there is continuity in the management of the Imaloto Coal project."

For further information please contact:

Enquiries: [e-mail]

Bushveld Minerals Fortune Mojapelo	[phone]
Fox-Davies Capital Jonathan Evans	[phone]
Tavistock Communications Jos Simson/ Nuala Gallagher Tielle Communications Stéphanie Leclercq	[phone]            [phone]

Notes to the editor:

Bushveld Minerals Limited is a mineral development company focused on the Bushveld Iron Ore Project and the Mokopane Tin Project, both located on the northern limb of the Bushveld Complex, South Africa.

The Company was admitted to the AIM Market of the London Stock Exchange in March 2012.

 

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