Possible Offer

RNS Number : 5071E

KazakhGold Group Ltd

29 September 2008

 

Not for release, publication or distribution in whole or in part in, into or from the US, Canada, Australia or Japan

KazakhGold Group Limited 

LSE: KZG

PRESS RELEASE

29 September 2008

Further to the possible offer announcement (the 'Possible Offer Announcement') released on 26 September, KazakhGold Group Limited ('KazakhGold' or the 'Company') can confirm further details of the approach received. The Company has been approached by OJSC Polyus Gold ('Polyus Gold') in connection with a possible partial offer by Polyus Gold (the 'Possible Partial Offer'), or a wholly owned subsidiary of Polyus Gold, for 50.1% of the issued and to be issued share capital of the Company (the 'Possible Partial Offer Shares'). 

The Possible Partial Offer would be pre-conditional on the approval of the final structure by The Panel on Takeovers and Mergers (the 'Panel').

Under the terms of the Possible Partial Offer, if made, KazakhGold shareholders would be entitled to receive:

• For each KazakhGold share:

  -     US$7.95 in cash; and

-     0.298 Polyus Gold ordinary shares (the 'Possible Partial Offer Terms').

The Possible Partial Offer Terms imply a value per Possible Partial Offer Share of US$ 14.73 (based on the closing price of a Polyus Gold share on MICEX of RUB 570.00 and a RUB/US$ exchange rate of 25.0703 taken from the Central Bank of Russia on 25 September 2008, the last business day prior to the date of the Possible Offer Announcement). 

In addition, the Possible Partial Offer would be subject to certain pre-conditions and conditions, including regulatory approvals, and will also be subject to the approval of the Possible Partial Offer being given in respect of over 50% of the voting rights held by shareholders of KazakhGold in accordance with Rule 36.5.

Gold Lion Holdings Limited ('Gold Lion') has indicated that it is supportive of the Possible Partial Offer and the Possible Partial Offer Terms, and its current intention is that, if the Possible Partial Offer is made, it will irrevocably undertake to accept the Possible Partial Offer for its entire holding of 22,100,000 KazakhGold shares representing 41.7% of the entire issued share capital of the Company. 

This announcement has been made with the agreement of Gold Lion and Polyus Gold.

There can be no certainty that any partial offer for the issued share capital of the Company will be forthcoming. The Company is consulting with its advisers concerning this approach and a further announcement will be made in due course as appropriate.

Each KazakhGold GDR represents one KazakhGold share. All references to Polyus Gold shares are to ordinary registered shares of Polyus Gold with a nominal value of 1 rouble each. 1 (one) Polyus Gold ordinary share is represented by 2 (two) ADRs. Polyus Gold's share prices have been sourced from MICEX. Polyus Gold trades on MICEX under the symbol PLZL. The MICEX prices are quoted in roubles, the consideration in US$ is calculated using the closing US$/RUB FX ratio taken from the Central Bank of Russia on on 25 September 2008, the last business day prior to the date of the Possible Offer Announcement.

Polyus Gold's issued share capital consists of 190,627,747 ordinary shares with a nominal value of 1 rouble each, each share having equal voting rights. 

The ISIN number of the Polyus Gold ordinary shares is RU000A0JNAA8.

For further information please contact:

Mike Jones 

Henry Fitzgerald O'Connor

Canaccord Adams Limited                     Tel: [phone]

(financial adviser to KazakhGold)

Jan Sanders

Sergei Chinkis

HSBC Bank plc

(financial adviser to Polyus Gold)            Tel: [phone]           

Canaccord Adams Limited ('Canaccord Adams'), which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively for the Company in connection with the Possible Partial Offer and will not be responsible to anyone other than the Company for providing the protections afforded to clients of Canaccord Adams nor for providing advice in relation to the Possible Partial Offer or any other matter referred to herein.

HSBC Bank plc ('HSBC'), which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively for Polyus Gold and its group in connection with the Possible Partial Offer and will not be responsible to anyone other than Polyus Gold and its group for providing the protections afforded to clients of HSBC nor for providing advice in relation to the Possible Partial Offer or any other matter referred to herein.

This announcement does not constitute an offer to sell or invitation to purchase any securities or the solicitation of any vote or approval in any jurisdiction.

The release, distribution or publication of this announcement in jurisdictions other than the UK may be restricted by law and therefore any persons who are subject to the laws of any jurisdiction other than the UK should inform themselves about and observe any applicable requirements.

The Polyus Gold Shares have not been, and will not be, registered under the United States Securities Act of 1933 (as amended) or under any relevant securities laws of any state or district of the United States. Securities may not be offered or sold in the United States absent registration or an exemption from registration. Polyus Gold does not plan to make a public offering of securities in the United States.

The Possible Partial Offer, if it is made, will not be made, directly or indirectly, in or into the US, Canada, Australia, Japan or any other jurisdiction if to do so would constitute a violation of the relevant laws of such jurisdiction. Accordingly, copies of this announcement are not being, and must not be, mailed or otherwise distributed or sent in or into or from the United States, Canada, Australia, Japan or any other such jurisdiction.

Neither this announcement nor the Possible Partial Offer described herein nor any information contained herein constitute an offer (''oferta'') pursuant to Russian law, or an advertisement, or an offer of securities to an unlimited number of persons within or outside the territory of the Russian Federation, or organisation of circulation of Russian securities outside of the Russian Federation.

Dealing disclosure requirements:

Under the provisions of Rule 8.3 of the Takeover Code (the 'Code'), if any person is or becomes 'interested' (directly or indirectly) in one per cent. or more of any class of 'relevant securities' of the Company or Polyus Gold, all 'dealings' in any 'relevant securities' of the Company or Polyus Gold by such person (including by means of an option in respect of, or a derivative referenced to, any such 'relevant securities') must be publicly disclosed to a Regulatory Information Service and the Panel on Takeovers and Mergers ('Panel') by no later than 3.30 p.m. (London time) on the London business day following the date of the relevant transaction. This requirement will continue until the date on which any offer for the Company becomes, or is declared, unconditional as to acceptances, lapses or is otherwise withdrawn or on which the 'offer period' otherwise ends. If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire an 'interest' in 'relevant securities' of the Company, they will be deemed to be a single person for the purpose of Rule 8.3.

Under the provisions of Rule 8.1 of the Code, all 'dealings' in 'relevant securities' of the Company or Polyus Gold, by the Company, or by any of it's respective 'associates', must also be disclosed by no later than 12.00 noon(London time) on the business day following the date of the relevant transaction.

A disclosure table, giving details of the companies in whose 'relevant securities' 'dealings' should be disclosed, and the number of such securities in issue, can be found on the Panel's website at www.thetakeoverpanel.org.uk.

'Interests in securities' arise, in summary, when a person has long economic exposure, whether conditional or absolute, to changes in the price of securities. In particular, a person will be treated as having an 'interest' by virtue of the ownership or control of securities, or by virtue of any option in respect of, or derivative referenced to, securities.

Terms in quotation marks are defined in the Code, which can also be found on the Panel's website.

If you are in any doubt as to whether or not you are required to disclose a 'dealing' under Rule 8, please contact an independent financial adviser authorised under the Financial Services and Markets Act 2000, consult the Panel's website at www.thetakeoverpanel.org.uk or contact the Panel by telephone [phone]) or by fax [phone]).

 

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