Bushveld Minerals Limited Update Acquisition of BEE Shareholding in Evraz Vametco

Bushveld Minerals Limited

Bushveld Minerals Limited (LON:BMN), a diversified mineral development company with projects in Southern Africa, have today announced that, further to the announcement made on 22 February 2017, it has signed a Deed of Settlement and Undertaking with Gingko Trading Proprietary Limited (“Gingko”) and Oakleaf Investments Holdings 115 Proprietary Limited (“Oakleaf 115”) (the “DSU”) regarding the settlement, by Bushveld, of all demonstrable funding (and accumulated interest thereon) that Gingko advanced to Oakleaf 115 as part of its acquisition in 2014 (as a participant in the Avacap Proprietary Limited consortium (“Avacap Consortium”)) of a 10% shareholding in Vametco Holdings Proprietary Limited (“Vametco”). Oakleaf 115 holds its 10% shareholding in Vametco through its 100% shareholding in Business Ventures Investments Holdings No 1833 Proprietary Limited (“BVI 1833”).

The DSU has been agreed as part of the broader acquisition by Jaxson 640 Proprietary Limited (“Jaxson”) of the Avacap Consortium’s interest in Vametco, as announced on 22 February 2017, in which Jaxson, a qualifying BEE company in accordance with the Broad Based Economic Empowerment Act of South Africa, has agreed conditionally to acquire an effective 21.2% interest in Vametco (the “Jaxson-Avacap Transaction”).

As a consequence of the implementation of the DSU, Bushveld shall be a lender alongside other lenders to Oakleaf. The DSU and Jaxson-Avacap Transaction are inter-conditional.

As announced on 22 February 2016, the Jaxson-Avacap Transaction is subject to several conditions precedent:

· Bushveld entering into the above mentioned DSU, whereby Bushveld will provide vendor financing for the settlement of all amounts owing to Gingko (“Gingko Funding Amount”) in respect of the BEE shareholding held by BVI 1833 including a share in all upside realised by Avacap Consortium under the Jaxson-Avacap Transaction. The Gingko Funding Amount comprises all demonstrable funding advanced by Gingko in respect of the acquisition of the BEE shareholding by the Avacap Consortium in BVI 1833. The total settlement is estimated at ZAR 7.55 million;

· The completion and implementation of Bushveld Vametco’s acquisition of SMC, a condition that cannot be waivered without the consent of Evraz Group SA;

· Consent to the transaction from Nedbank Limited, one of the funders of the Avacap Consortium’s acquisition of an interest in Vametco in 2014;

· Regulatory consent to the transaction from the Department of Mineral Resources in terms of Section 11 of the Mineral and Petroleum Resources Development Act.

The signing of the DSU fulfills a key part of the conditions to the completion of the Jaxson-Avacap Transaction.

Fortune Mojapelo, CEO of Bushveld Minerals Limited, commented: “The signing of the DSU with Gingko is an important step in the completion of the Jaxson-Avacap agreement and, as such, a further important milestone towards the completion of our acquisition of SMC. We look forward to providing further updates as we conclude the outstanding conditions.”

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