/ 18 January 2005

Harmony likely to extend Gold Fields offer

World number six gold miner Harmony Gold is likely to extend the deadline for the take-up of its subsequent offer to Gold Fields shareholders to mid-March as the regulatory process related to its proposed merger has taken longer than expected.

Harmony’s subsequent offer currently closes on February 4.

In its offer document to Gold Fields shareholders, released on October 18 last year, Harmony said it anticipated the Competition Tribunal finding regarding Harmony’s merger proposal by January 18 this year.

Harmony marketing director Ferdi Dippenaar said the company could extend its offer to mid-February or mid-March, depending on the speed with which the Competition Commission and Competition Tribunal process proceeds.

The final documentation required by the Competition Commission was filed with the regulatory body on December 15, and the first 40-day evaluation period began on December 17, which means the commission must issue its ruling by February 11.

However, after the end of the first 40 working days, the commission can extend its evaluation period by periods of 15 days at a time.

Having completed its evaluation, the commission will make recommendations to the Competition Tribunal, which will then make a decision on whether to allow the merger.

Harmony is currently offering Gold Fields shareholders 1,275 Harmony shares for every Gold Fields security held.

As a result of its early settlement offer, Harmony secured an 11,8% stake in Gold Fields. To increase its stake, Harmony will have to increase its offer ratio to Gold Fields shareholders, as Gold Fields shares are currently trading above Harmony’s offer at a ratio between 1,35 and 1,40.

However, Harmony has said that its current offer ratio is final. — I-Net Bridge