SUB NIGEL GOLD MINING COMPANY LIMITED - PRESS RELEASE ANNOUNCEMENT
Sub Nigel Gold Mining Company Limited
(incorporated in the Republic of South Africa)
(Registration No. 1984/006179/06)
JSE Share Code: SBN
ISIN: ZAE000006391
(`Sub Nigel` or the `company`)
PRESS RELEASE ANNOUNCEMENT
Shareholders are referred to the withdrawal of the cautionary announcement that
was published on SENS on 4 June 2004, dealing with the termination by Sub Nigel
of negotiations regarding a proposed investment by Centurion Gold Holdings
Incorporated (`Centurion`) in the company.
In connection with the above termination of negotiations, Shareholders are also
referred to the following allegations which have been made by Centurion in press
releases and an article in the electronic news media over the last month:
Press Release (10 May 2004)
* that `the Sub Nigel projects have as much as 12 million ounces of gold and
not less than 8 million ounces in proven reserves`;
* that `the terms of the agreement require the seller (to) supply to
Centurion documentation, describing the amount of the gold assets, as well
as a drill report detailing the location of the resource and its gold
values`; and
* that `Centurion expects to retain the current management of the gold mining
property and bring the key members of its experienced board onto the board
of Centurion upon closing`.
Press Release (4 June 2004)
* that it `has cancelled negotiations with Sub Nigel to acquire a stake in
the listed company due to Sub Nigel not being able to deliver on the proven
reserves of 12 million ounces indicated by Stephen Ward the company CEO`;
* that `the Sub Nigel board was also investigated for insider trading by the
Johannesburg Stock Exchange authorities (sic)`; and
* that `Sub Nigel`s CEO, Stephen Ward, (was) severely reprimanded for
misrepresentations in press releases`.
Article in the electronic news media (7 June 2004)
* that `the contract was for a 34% stake in Sub Nigel, for a purchase price
of $5 million`;
* that `Sub Nigel cannot prove the reserves as required under the
Memorandum`; and
* that `Sub Nigel cannot supply (Centurion) with the due diligence package`.
In respect of the above allegations, Shareholders are advised as follows:
Press Release (10 May 2004)
Centurion did not have any consent from the Sub Nigel board to make the 10 May
press release. With reference to the above quoted statements:
* Sub Nigel has never represented that it has gold or proven reserves in the
amounts stated;
* no agreement other than the Memorandum of Understanding signed between Sub
Nigel and Centurion on 10 May 2004 (`MoU`) was entered into with Centurion.
The MoU does not require Sub Nigel to supply to Centurion any such
documentation; and
* the future of Sub Nigel`s management and/or board was not discussed with
Centurion. Sub Nigel records that Centurion had no basis for stating any
expectation in this regard.
Press Release (4 June 2004)
* it was actually Sub Nigel that terminated negotiations with Centurion, due
to the failure of Centurion to deliver to Sub Nigel a bank guarantee in the
required amount within the required period. Shareholders are also referred
to the discrepancy between the alleged amount of proven reserves referred
to by Centurion in the 4 June press release and that referred to by
Centurion in the 10 May press release. Sub Nigel denies having been
obliged to deliver on any amount of proven reserves.
Neither Sub Nigel nor its CEO, Stephen Ward, has made any representations
regarding its proven reserves other than as set out in its cautionary
announcement dated 21 April 2004, wherein it is stated that development of
the company`s Spaarwater and Ventersburg projects would be dependent on the
outcomes of exploration, scoping and feasibility studies and that very
early estimates were that Spaarwater had an indicated resource of 3.5
million ounces of gold and Ventersburg had an indicated and inferred
resource of 8 million ounces of gold;
* the Sub Nigel board was not investigated for insider trading by the JSE
Securities Exchange South Africa (`JSE`), rather certain trades in Sub
Nigel shares on the JSE were investigated by its Surveillance Department.
No evidence of any suspicious trades was found; and
* Sub Nigel`s CEO, Stephen Ward, did not make any misrepresentations in press
releases, rather certain disclosures relating to the company`s activities
that had not previously been released on SENS were made by him. This
situation was rectified by means of the announcement dated 21 April 2004,
referred to above.
Article in the electronic news media (7 June 2004)
* in accordance with the MoU, the purchase price would be determined with
reference to the Sub Nigel share price over a certain period. The MoU
states a floor and ceiling for that share price, which would produce a
minimum purchase price of R41 million (approximately US$6,3 million) and a
maximum purchase price of R51 million (approximately US$7,9 million). Sub
Nigel records that Centurion had no basis for stating that the purchase
price would be $5 million;
* the MoU does not require Sub Nigel to prove any reserves;
* Sub Nigel was not required to deliver to Centurion any due diligence
package or information. The MoU states that Sub Nigel `shall ensure that
Centurion and its advisors has access, during normal business hours...to
such information and facilities of the Company as may be reasonably
necessary to conduct a proper and complete due diligence investigation`.
Such access was provided to Centurion, but no due diligence team arrived to
commence any investigation.
Johannesburg
10 June 2004
Date: 10/06/2004 03:59:04 PM
Produced by the JSE SENS Department |