Key points
- Namco owns approximately 34 per cent of ODM and holds an option over an additional eight million shares that could raise its stake to about 51 per cent.
- The offer represents roughly a 25 per cent premium over ODM’s share price at the close of Sept. 2, 1999, with shareholders offered 50 per cent cash and 50 per cent Namco shares valued at $4.00 (U.S.), or alternatively a fully underwritten cash offer at 8.25 rand per share.
- Namco has arranged $25-million (U.S.) in debt financing from Investec Bank plus $16-million (U.S.) via irrevocable undertakings from institutional investors, part of $47-million (U.S.) in total available financing.
- ODM, Southern Africa’s third largest marine diamond mining group, forecasts fiscal 1999 production of about 80,000 carats after mining 63,074 carats in 1998 from three vessels off Namibia.
Namibian Minerals intends to make an offer for the 30.8 million shares that it does not currently own in Ocean Diamond Mining Holdings Ltd. The 8.25-South-African-rand-per-share offer values ODM at $63-million (U.S.).
Namco owns approximately 34 per cent of ODM and has an option over an additional eight million shares (17 per cent) which if exercised would result in Namco owning approximately 51 per cent of ODM. Namco is making an offer at 8.25 South African rand, representing a premium of approximately 25 per cent on ODM’s share price at close of Sept. 2, 1999. ODM shareholders will be offered 50 per cent in cash and 50 per cent in Namco common shares at a price equivalent to $4.00 (U.S.). Alternatively, Namco is offering a fully underwritten cash offer of 8.25 South African rand per ODM share.
Namco has secured a debt financing of $25-million (U.S.) from Investec Bank and irrevocable undertakings have been received from institutional investors in respect of the remaining $16-million (U.S.). The company has reserved up to 5.44 million common shares for issuance as share consideration to ODM shareholders and for a private placement to be made outside of the United States and Canada at a price of $4.05 (U.S.) per share. Total available financing of $47-million (U.S.) includes $5-million (U.S.) for increased working capital purposes. Dilution on existing issued shares is approximately 15 per cent.
Investec Bank will act as financial advisers for the private placement.
The formal offer documents will be mailed to all registered holders of ODM’s common shares within 30 days of this announcement. The offer and offer documentation are subject to regulatory approval.
ODM is Southern Africa’s third largest marine diamond mining group, with
forecast production in fiscal 1999 of approximately 80,000 carats. Profitable production in 1998 was 63,074 carats from its three vessels operating off the coast of Namibia. ODM holds 20,078 square kilometres of mining licences and concession areas off the coast of Namibia and South Africa. It mines high-quality gem diamonds.
On Aug. 19, 1999, Namco announced that its chairman, Alastair Holberton, had been appointed chairman of ODM. Namco’s operations director, Peter Looijen, was also appointed to ODM’s board.
Namco’s chairman, Mr. Holberton, said, “We are confident that the
application of Namco’s large-scale marine mining technology will fully unlock the value of ODM’s concessions and further extend Namco’s participation in the world’s largest alluvial gem diamond deposit.”
Namco has a reputation as an innovator in marine mining technology and
currently plans to profitably mine more than 260,000 carats this year from its Luderitz Bay mining licence. Namibia is the world’s fifth largest diamond producer by value and more than 95 per cent of Namco’s production is gem quality.
