Archive - 2005

The deal will establish Newco as South Africa's flagship empowerment mining company with an enterprise value of approximately R16 billion – this will be South Africa's largest black-owned, controlled and managed company. Newco will be controlled by broad-based BEE groups via BEE Holdco, the black controlled holding company holding 55% of Newco. Women's groups will hold a 17.8% effective and fully funded interest in BEE Holdco.

Kumba Iron Ore will be an iron ore company listed on the JSE with an enterprise value of approximately R14 billion which, through the unbundling to all existing Kumba Resources shareholders of the iron ore assets, will hold the majority of Kumba Resources' South African iron ore assets through Sishen Iron Ore Company (Pty) Limited ("SIOC"), with Newco retaining a 20% stake in SIOC.

Commenting on the announcement, Lazarus Zim, Chief Executive Officer of Anglo American South Africa, said, "This transformational transaction, daring in its boldness and scale, creates two separate, sizeable and sustainable listed empowered companies. These new entities will be value accretive, breaking new ground in transformation and meeting the needs of stakeholders at every level. It has been Anglo American's privilege to have played a part in this exciting and truly broad-based transaction."

Dr Con Fauconnier, Chief Executive Officer of Kumba Resources, added, "Ever since Kumba Resources came into existence, Kumba has been exploring ways of creating a sustainable empowerment transaction reflective of South Africa's demographics. Today, Kumba has come of age and through our symbiotic relationship with Eyesizwe we have created South Africa's flagship empowerment company."

The transaction was hailed by Sipho Nkosi, Chief Executive of Eyesizwe Mining, as "Creating winners at every level – from the country that hosts the resources to the people that extract them to the communities that benefit. The joining of Kumba and Eyesizwe represents a new force in South African mining: a R16 billion company with an exceptionally broad base of empowerment shareholders and the ideal vehicle to accelerate sectoral growth and development in South Africa."

Philip Baum, Chief Executive Anglo Ferrous Metals and Industries, confirmed, "Iron ore is an essential component in our Ferrous Metals growth strategy. Anglo American's participation in today's transaction is further evidence of our long-term commitment to the development of iron ore as an important commodity in the growth of a portfolio offering shareholders a superior return on equity."

Welcoming the significant element of participation by women's groups in the transaction, Pinkie Ncetezo, Chair of Basadi Ba Kopane pledged, "True transformation and broad-based empowerment addresses gender issues and community participation and we are confident that as partners going forward these two vital attributes will be achieved." She continued, " We have the right calibre of women's groupings in this transaction to hold the torch for other women to follow."

Nchakha Moloi, Chairman of Eyabantu Capital added, "We are privileged to be part of a deal that is critical to promoting and sustaining new opportunities in the South African economy. The challenge for us is to succeed so we can open doors for those who will follow".

"We view this transaction as historic in South Africa's mining industry," stated the Deputy Chair of Tiso, Nkunku Sowazi. "Tiso will play its role in ensuring that we build a company characterised by sustainable growth, commercial integrity and long term commitment to South Africa's mining sector."