/ 17 March 2009

Gold Fields seals BEE deal with Mvelaphanda

Gold Fields (GFI), the world’s fourth-largest gold producer, on Tuesday confirmed that Mvelaphanda Resources (Mvela Resources, MVL) had taken receipt of its 15% shareholding in Gold Fields’ South African operations GFI Mining South Africa (GFIMSA).

This follows the maturing of Gold Fields’ R4,1-billion black economic empowerment transaction with Mvela Resources’ wholly owned subsidiary Mvelaphanda Gold (Mvela Gold).

Gold Fields said in a statement to the JSE that immediately on receipt of the GFI Mining South Africa shares, Mvela Gold exercised its right to require the exchange of the GFIMSA shares for 50-million new ordinary shares in the issued share capital of Gold Fields Limited.

“Gold Fields therefore today issued 50-million new ordinary Gold Fields Limited shares, listed on the JSE Limited, to Mvela Gold in exchange for the GFIMSA shares, which represents a 15% equity stake in the South African gold mining assets of Gold Fields,” Gold Fields confirmed.

This brings the total number of listed Gold Fields shares to 703 839 976 and pursuant to the above transactions, Mvela Gold now owns about 7% of the listed shares of Gold Fields Limited while Gold Fields again owns 100% of GFIMSA.

“We are particularly pleased that the transaction, which was based on fair value at a firm market price, has proven to be economically sensible and sustainable for existing Gold Fields shareholders, while creating significant real value for Mvela Resources shareholders, thus advancing black economic empowerment in South Africa,” said Gold Fields chief executive officer Nick Holland.

In the meantime, Mvela Resources on Monday announced that it had refinanced the R2-billion mezzanine debt associated with its investment
in Gold Fields.

Mvela Resources said the new funding, over a term of up to 12 months, has an approximate cost of 13,2% a year.

“This is less than the weighted coupon applicable to the mezzanine debt and is a significant achievement given the difficulties many companies face recapitalising their balance sheets in the current market,” said Mvela Resources CEO Pine Pienaar in a statement to the JSE.

Mvela Resources said its Gold Fields shares have an aggregate market value of more than R6-billion.

“Mvela Resources is positive on the outlook for gold and Gold Fields in the coming year and refinancing the mezz debt will allow Mvela Resources optimise the value of its Gold Fields investment at the appropriate time,” Pienaar added.

At 12:09 shares in Gold Fields were trading 1,47% or R1,80 lower at R121 on the JSE while Mvela Resources’ shares were 2,95% or 87 cents firmer at R30,37. — I-Net Bridge