TIDMLMI
RNS Number : 8780S
Lonmin PLC
06 October 2017
LEI: 213800FGJZ2WAC6Y2L94
REGULATORY RELEASE
Not for release, publication or distribution (directly or
indirectly) in whole or in part, in, into or from any jurisdiction
where to do so would constitute a violation of the relevant laws of
such jurisdiction.
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION
6 October 2017
Lonmin ("Lonmin" or the "Company", the "Group") gains bank
support for Pandora and secures a pre-emptive covenant waiver
Lonmin Plc ("Lonmin" or "the Company") is pleased to announce
the consent of its lending banks for its acquisition of the Pandora
JV and a pre-emptive waiver of its Consolidated Tangible Net Worth
("TNW") covenants for the period from 30 September 2017 to 30 March
2018 (the "Waiver Period").
Acquisition of the Pandora JV
As announced on 7 August 2017, Lonmin received approval from the
Department of Mineral Resources for both its S11 applications to
acquire the interests of Anglo American Platinum and Northam
Platinum in the Pandora JV. This followed the Competition Tribunal
approval received in May 2017. The completion of the transaction is
also subject to the consent of Lonmin's lending banks, which is
announced today.
The completion of the Pandora transaction unlocks significant
synergies. It allows Lonmin to extend mining at its Saffy shaft
without having to spend R2.6 billion of capital expenditure, of
which R1.6 billion would have been required over the next four
years.
Lonmin expects to complete the acquisition before the
announcement of its full-year results in November 2017, having met
all the remaining administrative conditions precedent.
Operational Review and pre-emptive TNW Covenant waiver
As also announced on 7 August 2017, Lonmin's management team is
focused on pursuing options to preserve value for shareholders and
safeguard the long-term interests of employees and all key
stakeholders through the Operational Review. The Company is
exploring several initiatives and is currently progressing early
stage discussions with a variety of parties.
As detailed on 15 May 2017 in Lonmin's Interim Results, the
Company's loan facility agreements require it to test two covenants
related to its TNW every six months. The Group's TNW is
predominantly affected by macroeconomic factors outside Lonmin's
direct control, including the period-end US dollar/South African
rand exchange rate and PGM price outlook.
The Company is currently in the process of finalising the 30
September 2017 financial statements and the calculation of its TNW
as at its 30 September year-end; however, as a pre-emptive measure
and in order to focus on the Operational Review, Lonmin has
requested and obtained a waiver of both covenants for 30 September
2017.
The Company has also agreed with its lending banks, as a
condition to the waiver, to cancel its revolving B2 facilities of
$21 million and to leave undrawn approximately $200 million of
remaining revolving credit facilities during the Waiver Period.
Lonmin will continue to regularly update its lending banks to
ensure their consent for the implementation of initiatives
identified by the Operational Review. The remaining revolving
credit facilities will be available following the end of the Waiver
Period subject to the banks being satisfied with the resulting
business plan and Lonmin's ability to pass the TNW covenant tests
at that time.
The Group's liquidity is expected to be adequate for the Waiver
Period, taking into account the Company's past working capital
requirements, particularly during the first quarter of the
financial year, with the continued support of the lending banks and
absent any material unforeseen adverse events. The Company has
generated cash in Q4 resulting in an increased net cash position of
approximately $100 million from $86 million at the end of Q3
2017(unaudited). The Gross cash at fiscal year ending 30 September
2017 was approximately $250 million.
Lonmin expects sales to be slightly above guidance for the
financial year 2017 and confirms unit cost and capex guidance.
- END -
ENQUIRIES
Investors / Analysts:
Tanya Chikanza (Head of Investor Relations) +44 203 908 1073 / +27 11 218 8358
Andrew Mari (Investor Relations Manager) +27 11 218 8420
Media:
Wendy Tlou (Head of Corporate Communications) +27 11 218 8300 / +27 83 358 0049
Anthony Cardew / David Roach, Cardew Group +44 207 930 0777
Additional Information
The release, publication or distribution of this announcement in
certain jurisdictions may be restricted by law. Persons who are not
resident in the United Kingdom or who are subject to the laws of
other jurisdictions should inform themselves of, and observe, any
applicable requirements. Any failure to comply with applicable
requirements may constitute a violation of the securities law of
any such jurisdiction.
This announcement is not intended to, and does not, constitute
or form part of any offer, invitation or the solicitation of an
offer to purchase, otherwise acquire, subscribe for, sell or
otherwise dispose of, any securities whether pursuant to this
announcement or otherwise.
Notes to editors
Lonmin, which is listed on both the London Stock Exchange and
the Johannesburg Stock Exchange, is one of the world's largest
primary producers of PGMs. These metals are essential for many
industrial applications, especially catalytic converters for
internal combustion engine emissions, as well as their widespread
use in jewellery.
Lonmin's operations are situated in the Bushveld Igneous Complex
in South Africa, where more than 70% of known global PGM resources
are located.
The Company creates value through mining, refining and marketing
PGMs and has a vertically integrated operational structure - from
mine to market. Underpinning the operations is the Shared Services
function which provides high quality levels of support and
infrastructure across the operations.
For further information please visit our website:
http://www.lonmin.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
ACQEAEESEEAXFAF
(END) Dow Jones Newswires
October 06, 2017 02:00 ET (06:00 GMT)
Lonmin (LSE:LMI)
Historical Stock Chart
From Apr 2024 to May 2024
Lonmin (LSE:LMI)
Historical Stock Chart
From May 2023 to May 2024