Binding Agreement for the Sale of AREVA’s Stake in La Mancha Resources Inc.
GROUP / FINANCE
July 13, 2012
AREVA announces that its 63% owned subsidiary, La Mancha Resources Inc. (“La Mancha” or the “Company”), has entered today into an agreement (the “Support Agreement”) with Weather II Investments (“Weather II”), pursuant to which Weather II has agreed, subject to the terms of the Support Agreement, to offer to purchase all outstanding common shares of La Mancha by way of a recommended take-over bid at a price of C$3.50 per share in cash (the “Offer”). Weather II is one of the many successful businesses managed by Mr. Naguib Sawiris. The wider Sawiris Family of Egypt have substantial indirect interests in existing operations in the telecoms, construction and fertilizers, cement, real estate and hotel development industries.
The Offer is not conditional on financing and represents a premium of approximately 55.6% to the closing price of the Company’s common shares on the Toronto Stock Exchange on July 12, 2012, immediately prior to the announcement of the Offer and a premium of approximately 43.1% to the 20-day volume weighted average price as at July 12, 2012 of the Company’s common shares on the Toronto Stock Exchange.
An auction process was launched following a request received from La Mancha’s majority shareholder, Compagnie Française de Mines et Métaux (“CFMM”), a wholly-owned subsidiary of AREVA. After the review of a number of proposals from different parties, La Mancha’s Board of Directors has agreed to recommend to the shareholders that they accept the Offer. CFMM has entered into a hard lock-up with Weather II pursuant to which it has irrevocably agreed to tender 90 million shares, or approximately 63% of the Company's fully diluted outstanding shares, into the Offer.
If the offer is successful, Weather II has agreed to take steps available to it under relevant corporate and securities laws to acquire any remaining outstanding common shares of the Company.
Weather II has announced that it intends to commence its Offer and to mail its take-over bid circular within 15 business days of the signing of the Support Agreement. The Offer will be open for acceptance for a period of not less than 35 days. La Mancha’s Board of Directors intends to mail its Directors’ Circular recommending the Offer at the same time as the mailing of the Weather II Take-over Bid Circular. The details of the Offer will be contained in the take-over bid circular.
The sale of its stake in La Mancha Resources Inc. is part of AREVA’s “Action 2016” strategic plan. The proceeds of the sale of AREVA’s shares will be equal to approximately C$315 million. Once concluded, the sale will contribute to further reduce AREVA's net debt and helps to finance the group's strategic and safety investment program.
La Mancha Resources Inc. is an international gold producer based in Canada with operations, development projects and exploration activities in Africa, Australia and Argentina. In 2011, La Mancha’s revenues and EBITDA amounted C$184.7 million and C$83.8 million respectively.