RANDGOLD RESOURCES LIMITED
Incorporated in Jersey, Channel Islands
Reg. No. 62686
LSE Trading Symbol: RRS
Nasdaq Trading Symbol: GOLD
("Randgold")
RANDGOLD RESOURCES AND MOTO GOLDMINES ENTER INTO BUSINESS COMBINATION
Not for release, publication or distribution, 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.
London, United Kingdom, 5 August, 2009 - Randgold Resources Limited
(LSE : RRS ) (NASDAQ : GOLD ) ("Randgold") and Moto Goldmines Limited ("Moto"
or the "Company") (TSX : MGL ) (AIM : MOE ) today announced that the offer
from Randgold, which was announced on 27 July 2009, has been accepted
by Moto and that they have entered into an arrangement agreement (the
"Arrangement Agreement") providing for the exchange of each outstanding
common share of Moto for the equivalent of CUSD4.84 per share (as at 4
August 2009) on the basis of each Moto common share being exchanged for
0.07061 of a Randgold ordinary share or American Depositary Share
("ADS") of Randgold (the "Randgold Transaction").
Immediately prior to accepting the Randgold Transaction, Moto
terminated the existing arrangement agreement with Red Back Mining Inc.
("Red Back") in accordance with its terms and initiated payment to Red
Back of the agreed termination fee of CUSD15,250,000. The voting
agreements of the Moto directors and officers regarding the Red Back
transaction have also been terminated.
Moto has also cancelled the meeting of Moto shareholders and
optionholders that was scheduled for 4:00 pm (Vancouver, British
Columbia time) on 5 August 2009. Moto will advise of the new date for
a meeting of Moto shareholders and optionholders to consider the
Randgold Transaction once that date is set.
Under the Randgold Transaction, Moto shareholders will receive 0.07061
of an ordinary share of Randgold (or, where applicable, 0.07061 of an
ADS of Randgold) per Moto share. In addition, Moto shareholders will
be provided the option to elect to receive (in lieu of Randgold shares
or ADSs) cash consideration of USUSD4.47 per Moto share in respect of all
or some of their Moto shares, subject to proration based on an
aggregate maximum cash amount payable to all Moto shareholders under
the Randgold Transaction of USUSD244 million (the "Cash
Election"). Assuming full take-up of the Cash Election Randgold would
expect to issue a total of approximately 3.9 million shares (including
shares represented by ADSs) and pay a total cash amount of
approximately USUSD244 million to Moto shareholders.
Moto's Board of Directors has unanimously recommended that the
shareholders and optionholders of Moto vote in favour of the Randgold
Transaction. Concurrently with Moto entering into the Arrangement
Agreement with Randgold, the directors and officers of Moto have
entered into voting agreements in respect of the Randgold Transaction
(representing an aggregate of 2,782,472 million shares (2.5%) of
Moto). Together with the support of shareholders of Moto representing
an aggregate of 39.4 million shares, a total of 42.2 million
shares, or 38.2% of the issued and outstanding common shares of
Moto, have agreed to support the Randgold Transaction. In addition,
Randgold has received formal written support for the Randgold
Transaction from the Government of the DRC.
Based on the closing price of Randgold ADSs on NASDAQ on 4 August 2009
of USUSD64.11 per ADS, the Randgold Transaction values Moto at
approximately USUSD500 million (CUSD534 million based on the noon exchange
rate published by the Bank of Canada on 4 August 2009) and represents a
premium to Moto shareholders of:
* approximately 7%, based on the closing price of Moto's common shares
on the Toronto Stock Exchange as at 29 May 2009, the last business day
prior to the announcement of the offer by Red Back (the "Red Back
Transaction") and the closing price of Randgold's ADSs on NASDAQ,
adjusted to Canadian dollars, as at 4 August 2009; and
* approximately 51%, based on the 20-day volume-weighted average price
of Moto's common shares on the Toronto Stock Exchange to 29 May 2009,
the last business day prior to the announcement of the Red Back
Transaction and the 20-day volume weighted average price of Randgold's
ADSs on NASDAQ, adjusted to Canadian dollars, to 4 August 2009.
Joint Venture with AngloGold Ashanti
Randgold and AngloGold Ashanti Limited ("AngloGold") have agreed to
cooperate in respect of the Randgold Transaction. In that regard,
AngloGold has agreed to fully fund the Cash Election described above in
partial payment for an indirect 50% interest in Moto which it will
acquire upon completion of the Randgold Transaction. In addition,
following completion of the Randgold Transaction, AngloGold will be
jointly responsible with Randgold for funding the development of the
Moto Gold Project for the collective benefit of the shareholders of all
three companies. Randgold will be appointed operator of the project.
Randgold and AngloGold have received the full support from their
respective boards of directors for the Randgold Transaction. Neither
Randgold nor AngloGold requires shareholder approval in order to
proceed with the Randgold Transaction.
Key benefits of the Randgold Transaction to Moto shareholders
Randgold is a gold producer with a proven track record of finding,
financing, developing and operating mines in West Africa. Randgold has
a history of building strong relationships with the governments in
whose countries it operates, especially in Francophone Africa, and has
a proven track record of delivering profits and real value to
shareholders through long term disciplined growth based on maintaining
a pipeline of high-quality development projects, strict cost control
and operational excellence. AngloGold is one of the largest gold
producers in the world with meaningful production and exploration
activities in Africa, including exploration activities in the
Democratic Republic of the Congo ("DRC"). The agreement to develop
jointly the Moto Gold Project combines Randgold's and AngloGold's
regional business knowledge and government relationships with their
extensive gold mining expertise.
Randgold and Moto see the following key attractions to the Randgold
Transaction:
* Ability to bring the Moto Gold Project into production. Moto
shareholders will benefit from Randgold's strong, experienced technical
and management teams that have proven their ability to bring assets
into production in West Africa. Randgold and AngloGold, together,
bring the scale and the access to capital required to bring the Moto
Gold Project into production, together with their experience in
governmental relationships. Randgold's capital projects team is the
same team that has successfully built three mines in West Africa,
including one underground mine, and has proven its ability to build
mining projects to first world standards within acceptable capital
constraints.
* Political support and regional knowledge. Randgold has a successful
track record of unlocking the mineral wealth of other countries in the
region, in particular in Francophone Africa, whilst at the same time
being regarded as a good corporate citizen and socially
responsible. Across its six operations in three West African
countries, together with its Geita gold mine in Tanzania, AngloGold has
a well established mining track record in West and Eastern
Africa. AngloGold has been a joint venture partner with Randgold in
the Morila mine in Mali since July 2000, where the two companies
continue to enjoy a successful partnership. Following its business
combination with Ashanti Goldfields Company Limited in April 2004,
AngloGold acquired exploration properties in the DRC, with current
greenfield exploration activities focused around the town of Mongbwalu
in the north-eastern part of the country. In addition to its extensive
exploration activities in the north-east, AngloGold also maintains a
fully staffed country office in the DRC capital, Kinshasa. As such,
Randgold and Moto believe that Randgold's and AngloGold's relationships
in Africa will assist in unlocking the value of the Moto Gold
Project. Randgold has received formal written support for the Randgold
Transaction from the Government of the DRC.
* Continued participation in the Moto Gold Project. Moto
shareholders, through their interest in the enlarged Randgold, will
continue to benefit from any upside in the Moto Gold Project when it is
developed by Randgold and AngloGold.
* Liquidity. Over the last month the average aggregate daily trading
value of Randgold shares on the London Stock Exchange and Randgold ADSs
on NASDAQ was USUSD95 million, compared to an aggregate of USUSD2 million
for Moto's shares on the Toronto Stock Exchange and the London Stock
Exchange's Alternative Investment Market, adjusted to United States
dollars, to 4 August 2009.
* Diversification of risk. Through their continued participation in
the enlarged Randgold, Moto shareholders will have an interest in a
company that is active across West and Central Africa, with assets that
span the developmental lifecycle, from exploration and highly
prospective opportunities through to immediately pre-development
projects and producing assets.
* Participation in the upside in Randgold's portfolio. Moto
shareholders will participate in any upside in Randgold's existing
assets and successful exploration portfolio. In particular, Randgold
sees significant continued exploration upside at both Loulo and Tongon,
whilst Massawa and Randgold's latest discovery, Gounkoto, have the
potential to be truly world class assets.
* Financial strength in challenging times. Randgold and AngloGold are
well funded and, together with their existing strong cash flows from
operations, are capable of funding current development and future
projects, including the Moto Gold Project.
* Ability to exit for certain value at a premium. In the event that
any Moto shareholder is not attracted to the merits of the Randgold
Transaction as outlined above, an option to elect for up to 100% cash
consideration (subject to proration) and lock in the premium being
offered is available.
Transaction
The Randgold Transaction will be carried out by way of statutory plan
of arrangement, on substantially similar terms to that which had been
contained in the arrangement agreement with Red Back. On closing of
the Randgold Transaction, Moto will become indirectly jointly-owned by
Randgold and AngloGold. Under the terms of the Randgold Transaction,
assuming that Moto shareholders elect to receive the maximum aggregate
amount of cash offered under the Cash Election, being USUSD244 million,
it is expected that Randgold will issue approximately 3.9 million
shares (including shares represented by ADSs) to Moto shareholders as
consideration, representing approximately 4.6% of Randgold's shares in
issue following closing. If no Moto shareholders elect to receive
the Cash Election, it is expected that Randgold would issue
approximately 7.8 million shares (including shares represented by ADSs)
to Moto shareholders as consideration, representing approximately 8.6%
of Randgold's shares in issue following closing.
If Moto shareholders elect to receive, in aggregate, more than the
maximum aggregate amount of cash offered under the Randgold
Transaction, (a) the amount of cash consideration available to Moto
shareholders making a cash election pursuant to the Randgold
Transaction will be allocated pro rata among all Moto shareholders
making valid cash elections; and (b) each Moto shareholder electing
cash will instead receive Randgold ordinary shares (or ADSs, as
applicable) in exchange for the remainder of their Moto shares for
which they did not receive cash due to proration.
Entitlements to fractions of a Randgold share (or ADS, as applicable),
as well as the entitlements of any Moto shareholders who are resident
in any jurisdictions where it is or may be unlawful for them to receive
Randgold shares (or ADS, as applicable), will be paid in cash pro rata
to entitlements, based on a whole Randgold share being valued at
USUSD63.26, and such cash payments, if any, will not reduce the amount
available to pay the Cash Election.
The Arrangement Agreement includes a commitment by Moto not to solicit
or initiate discussions concerning alternative transactions, including
the sale of material assets. Moto has agreed to pay a break fee of
USUSD14,627,300 to Randgold in certain circumstances and has granted
Randgold the right to match competing offers. Randgold has agreed to
reimburse Moto for the Red Back termination fee in certain
circumstances where the Randgold Transaction does not close. Each
party has also been provided with certain other rights, representations
and warranties and covenants customary for a transaction of this
nature.
Completion of the Randgold Transaction is subject to certain customary
conditions, including the receipt of all necessary court and regulatory
approvals, third party consents and the approval of the Randgold
Transaction by not less than 66 2/3% of the outstanding shares and
options of Moto, voting as a single class and a simple majority of the
votes cast in person or by proxy by Moto shareholders at the special
meeting that will be called to approve the Randgold Transaction.
Full details of the transaction will be included in a Moto Management
Information Circular to be filed with applicable Canadian securities
regulatory authorities and mailed to Moto shareholders in accordance
with applicable Canadian securities laws. Moto expects to mail the
Management Information Circular in September 2009. The transaction is
expected to close in October 2009.
BMO Capital Markets has provided an opinion to the Moto Board of
Directors that the consideration to be received by the shareholders of
Moto in connection with the Randgold Transaction is fair, from a
financial point of view, to Moto shareholders. Randgold's financial
advisor is HSBC Bank plc.
This release is for informational purposes only and it is not intended
to be proxy solicitation materials and it does not constitute an offer
to sell or a solicitation of an offer to buy securities of Randgold,
Moto or AngloGold.
ENQUIRIES:
For further information, please contact:
Randgold Resources Limited
Dr Mark Bristow Kathy du Plessis
Chief Executive Investor & Media Relations
Tel: +44 788 071 1386 or Tel: +44 20 7557 7738
Tel: +44 779 775 2288 email: randgoldresources@dpapr.com
Moto Goldmines Limited
Andrew Dinning Mark Arnesen
President and Chief Operating Financial Director and Chief
Officer Financial Officer
Tel: +61 8 9273 4222 Tel: +61 8 9273 4222
email: adinning@motogoldmines.com email: marnesen@motogoldmines.com
RFC Corporate Finance Ltd (Nominated Advisor to Moto for the purposes
of AIM)
Steve Allen
Tel: +61 8 9480 2508
email: Steve.Allen@rfc.com.au
GMP Securities Europe LLP (AIM Broker to Moto)
James Cassley
Tel: +44 20 7647 2803
email: james.cassley@gmpeurope.com
Randgold Resources Limited website: www.randgoldresources.com
Moto Goldmines Limited website: www.motogoldmines.com
About Randgold
Randgold is a gold mining and exploration company with its principal
activities focused on West and East Africa and stated reserves of
8.87Moz. In Mali, Randgold has an 80% controlling interest in the
Loulo mine, which is currently mining from two open pits and has just
commenced mining from one underground mine whilst developing a second
underground mine. In the Loulo region, Gounkoto, on the Loulo permit,
is shaping up as a significant new discovery. Also in Mali, Randgold
owns a 40% interest in the Morila Joint Venture, the owner of the
Morila mine, which it also operates. In Cote d'Ivoire, Randgold owns
an effective 84% controlling interest in the Tongon development
project, where it has commenced construction and expects to be in
production towards the end of 2010. In Senegal, Randgold has a new
discovery, Massawa, which is at prefeasibility stage and which it
believes has multi million ounce potential and the makings of a
world-class orebody. Randgold also has exploration permits and
licenses covering substantial areas in Mali, Cote d'Ivoire, Burkina
Faso, Ghana, Senegal and Tanzania. The acquisition of Moto will
increase Randgold's attributable mineral reserves, measured and
indicated resources, and inferred resources by 1.9Moz, 4.0Moz, and
3.9Moz, respectively.
About Moto
Moto is an emerging gold producer committed to developing its key
asset, a 70% interest in the Moto Gold Project ("the Project") which is
one of the largest undeveloped gold deposits in Africa. The project is
a joint venture between L'Office des Mines d'or de Kilo-Moto ("OKIMO")
and Moto and covers an area of approximately 1,836km2 with significant
mineral resources and growth potential. The company completed an
Optimized Feasibility Study in March 2009 which contemplates an open
pit and underground mining operation producing approximately 2.4Moz in
the first five years of operation, with total mineral reserves
estimated to be 5.5Moz. The Project hosts significant inferred mineral
resources of 11.2Moz which provide a solid platform for growth. As at
31 March 2009, Moto had gross assets of approximately AUSUSD245.8m. For
the year ended 31 December 2008, Moto made a net loss of approximately
AUSUSD14.1m.
The information in this news release that relates to the Moto Gold
Project's Mineral Resources is based on information compiled by Rick
Adams and Ted Hansen who are members of the Australasian Institute of
Mining and Metallurgy (AusIMM) and are qualified persons under NI
43-101. Rick Adams and Ted Hansen are directors of Cube Consulting Pty
Ltd and consent to the inclusion in this report of the information, in
the form and context in which it appears.
The information in this news release that relates to the Moto Gold
Project's open pit Mineral Reserves is based on information compiled by
Cube Consulting Pty Ltd under the direction of Quinton de Klerk who is
a member of the Australasian Institute of Mining and Metallurgy
(AusIMM) and a qualified person under NI 43-101. Quinton de Klerk is a
director of Cube Consulting Pty Ltd and consents to the inclusion in
this report of the Information, in the form and context in which it
appears.
The Information in this news release that relates to the Moto Gold
Project's underground Mineral Reserves is based on information compiled
by SRK Consulting Pty Ltd under the direction of Paul Kerr who is a
member of the Australasian Institute of Mining and Metallurgy (AusIMM)
and a qualified person under NI 43-101. Paul Kerr is an employee of
SRK Consulting Pty Ltd and consents to the inclusion in this report of
the Information, in the form and context in which it appears.
Legends
HSBC, which is authorised and regulated in the United Kingdom by the
Financial Services Authority, is acting exclusively for Randgold and no
one else in connection with the Randgold Transaction and will not be
responsible to anyone other than Randgold for providing the protections
afforded to clients of HSBC, nor for providing advice in relation to
the Randgold Transaction, the contents of this announcement or any
other matter referred to herein.
CAUTIONARY NOTE REGARDING FORWARD LOOKING-STATEMENTS
Except for the historical information contained herein, the matters
discussed in this news release are forward-looking statements within
the meaning of Section 27A of the U.S. Securities Act of 1933 and
Section 21E of the U.S. Securities Exchange Act of 1934, and applicable
Canadian securities legislation. Forward-looking statements include,
but are not limited to, statements with respect to the future price of
gold, the estimation of mineral reserves and resources, the realization
of mineral reserve estimates, the timing and amount of estimated future
production, costs of production, reserve determination and reserve
conversion rates. Generally, these forward-looking statements can be
identified by the use of forward-looking terminology such as "will",
"plans", "expects" or "does not expect", "is expected", "budget",
"scheduled", "estimates", "forecasts", "intends", "anticipates" or
"does not anticipate", or "believes", or variations of such words and
phrases or state that certain actions, events or results "may",
"could", "would", "might" or "will be taken", "occur" or "be
achieved". Assumptions upon which such forward looking statements are
based include that Randgold and Moto will be able to satisfy the
conditions in the Arrangement Agreement, that the required approvals
will be obtained from the shareholders of Moto, that all third party
regulatory and governmental approvals to the transaction will be
obtained and all other conditions to completion of the transaction will
be satisfied or waived. Many of these assumptions are based on factors
and events that are not within the control of Randgold or Moto and
there is no assurance they will prove to be correct. Forward-looking
statements are subject to known and unknown risks, uncertainties and
other factors that may cause the actual results, level of activity,
performance or achievements of Randgold and Moto to be materially
different from those expressed or implied by such forward-looking
statements, including but not limited to: risks related to the
integration of the combined companies, risks related to mining
operations, including political risks and instability and risks related
to international operations, actual results of current exploration
activities, conclusions of economic evaluations, changes in project
parameters as plans continue to be refined, as well as those factors
discussed in the section entitled "Risk Factors" in Randgold's annual
report on Form 20-F for the year ended December 31, 2008 which was
filed with the U.S. Securities and Exchange Commission on May 15, 2009
and in the section entitled "Risk Factors" in Moto's Amended and
Restated Annual Information Form of the year ended December 31,
2008. Although Randgold and Moto have attempted to identify important
factors that could cause actual results to differ materially from those
contained in forward-looking statements, there may be other factors
that cause results not to be as anticipated, estimated or
intended. There can be no assurance that such statements will prove to
be accurate, as actual results and future events could differ
materially from those anticipated in such statements. Accordingly,
readers should not place undue reliance on forward-looking
statements. Randgold and Moto do not undertake to update any
forward-looking statements herein, except in accordance with applicable
securities laws.
Cautionary note to US investors; the U.S. Securities and Exchange
Commission (the "SEC") permits companies, in their filings with the
SEC, to disclose only proven and probable ore reserves. We use certain
terms in this release, such as "resources", that the SEC does not
recognise and strictly prohibits us from including in our filings with
the SEC. Investors are cautioned not to assume that all or any parts of
our resources will ever be converted into reserves which qualify as'proven
and probable reserves' for the purposes of the SEC's Industry
Guide number 7.
Randgold and Moto will be filing important documents relating to the
Randgold Transaction with the SEC and with applicable Canadian
securities regulatory authorities, including a copy of the Arrangement
Agreement. The description of the Arrangement Agreement contained
herein does not purport to be complete and is qualified in its entirety
by reference to the full text of the Arrangement Agreement. Investors
and security holders are urged to carefully read the Arrangement
Agreement and all such documents filed with the SEC and applicable
Canadian securities regulatory authorities, because these documents
will contain important information. Investors and security holders will
be able to obtain a free copy of such documents at the SEC's web site
at www.sec.gov, at the website of the Canadian securities regulators at
www.sedar.com, or by directing a request to Moto as provided above or
to:
Randgold Resources Limited
David Haddon
General Counsel and Secretary
This information is provided by RNS
The company news service from the London Stock Exchange
END
Contact Information: Contacts: RNS Customer Services 0044-207797-4400 http://www.rns.com