Mvela Resources and Gold Fields Agrees on 50 million shares should “flip-up” proceed
Johannesburg.- Gold Fields Limited (Gold Fields) (JSE, NYSE and DFIX: GFI) and Mvelaphanda Resources Limited (Mvela Resources) (JSE: MVL) are pleased to announce that the parties have agreed that Mvela Resources will receive 50 million Gold Fields shares if and when Mvela Resources’ future stake of 15% in GFI Mining South Africa (Proprietary) Limited (GFIMSA) Limited is exchanged at the instance of either Gold fields or Mvela Resources, for shares in Gold Fields. GFIMSA is the vehicle that owns and houses the South African assets of Gold Fields.
The exact number of shares, within the range of the floor and cap (45 and 55 million shares respectively), which Mvela Resources would have received should the exchange have been implemented in terms of current agreements, was extremely volatile because of the input parameters for a Discounted Cash Flow valuation, and the complex nature of the formula, and agreeing the number of shares now gives certainty on an equitable basis to both parties.
Nick Holland, Chief Financial Officer of Gold Fields said: “We agreed on 50 million shares as it is the midway point between the floor and cap, and we believe represents a fair deal.”
Pine Pienaar of Mvela Resources said: “This arrangement will bring certainty to the shareholders of Mvela Resources as to the size of our potential future stake in Gold Fields.”
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