Trading Symbol: SXR - The Toronto Stock Exchange
TORONTO and JOHANNESBURG, SOUTH AFRICA, June 26 /CNW/ - sxr Uranium One
Inc. announced today that its 79%-owned subsidiary, Aflease Gold Limited, has
entered into a share exchange agreement with a South African institution under
which Aflease Gold will acquire at its election not less than 7,500,000 and
not more than 13,000,000 shares of Randgold and Exploration Ltd. ("Randgold").
In consideration for the Randgold shares, Aflease Gold will issue from
treasury on closing a number of shares equal to seven times the number of
Randgold shares it elects to acquire and, on a second closing, will issue
additional shares pursuant to a formula if Randgold's net asset value, when
this is in due course determined, exceeds Rand 14.70 (Cdn $2.29) per share. A
maximum of three times the number of elected Randgold shares is issuable on
such second closing if Randgold's net asset value exceeds Rand 21.00 (Cdn
$3.28) per share. The agreement is conditional on, among other things, JCI
Limited confirming to Aflease Gold that the unconditionally net recoverable
indebtedness of JCI and its subsidiaries to Randgold and its subsidiaries is
not less than Rand 1.1 billion (Cdn $176.6 million). Closing is subject to
Johannesburg stock exchange approval and to the shareholders of Aflease Gold
approving a resolution increasing the company's authorized share capital.
Uranium One has advised Aflease Gold that it intends to vote in favour of such
resolution.
Completion of the share exchange transaction will increase Aflease Gold's
asset base, give it additional flexibility with respect to the financing of
its assets, including the Modder East Gold Project, and enhance the liquidity
of its ordinary shares. While the transaction will reduce Uranium One's
interest in Aflease Gold, Uranium One will continue to own a majority of
Aflease Gold's issued ordinary shares.
The acquisition will give Aflease Gold an equity interest in Randgold of
between 10.0% and 17.4%, which will complement Uranium One's existing 11.6%
interest in Randgold. The combined stake in Randgold is expected to enable the
two companies to play a significant role in facilitating a resolution of the
current claims between Randgold and JCI, with the aim of securing full value
for the shareholders of Randgold, whether through a distribution of JCI's
assets or otherwise.
Randgold was suspended from the Johannesburg stock exchange and NASDAQ in
2005 and a forensic investigation into its affairs is still ongoing. In light
of these developments, Uranium One wrote off its Randgold investment in
December 2005. Randgold, however, continues to own a portfolio of mineral
rights and investments in mining and mineral exploration companies, including
a 3.5% interest in Western Areas Ltd., which holds a 50% joint venture
interest in the South Deep gold mine in South Africa. JCI's assets include a
24.9% interest in Western Areas Ltd.
About sxr Uranium One
sxr Uranium One Inc. is a Canadian uranium and gold resource company with
a primary listing on the Toronto Stock Exchange and a secondary listing on the
Johannesburg stock exchange. Uranium One owns the Dominion Uranium Project in
South Africa and the Honeymoon Uranium Project in South Australia, as well as
a number of exploration projects. The Corporation holds a 79% interest in
Johannesburg stock exchange-listed Aflease Gold Limited, which owns the Modder
East Gold Project in South Africa. Through a joint venture with Pitchstone
Exploration Ltd., Uranium One is also engaged in uranium exploration
activities in the Athabasca Basin of Saskatchewan.
Cautionary note concerning forward-looking statements: Statements in this
release that are not historical facts are "forward-looking statements"
involving known and unknown risk and uncertainties which are beyond the
ability of the Corporation to control or predict and which could cause actual
events or results to differ materially from those anticipated in such
forward-looking statements.
To receive the Corporation's news releases by email, contact Carol Smith,
Investor Relations at carol(at)uranium1.com or Chris Sattler, Vice President,
Investor Relations, at chris(at)uranium1.com. The TSX has neither approved nor
disapproved of the information contained herein.
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