Filing of Preliminary Prospectus for initial public offering and TSX listing of Non-South African exploration assets
22 September 2005
This announcement appears as a matter of record only.
African Rainbow Minerals Limited (“ARM”) has announced that a preliminary prospectus has been filed with the Ontario Securities Commission (Canada) for the initial public offering (“IPO”) of its development and exploration assets in Namibia, Zambia and the Democratic Republic of Congo.
The Non-South African assets of ARM will be transferred to TEAL Exploration & Mining Incorporated (“TEAL”), a newly formed Canadian subsidiary of ARM. TEAL will seek to have its securities listed on the Toronto Stock Exchange (“TSX”), subsequent to the completion of the IPO.
ARM cautions that the IPO and TSX listing are conditional upon the approval of various matters by regulatory authorities in Canada, including the approval by the TSX and the acceptance of a final prospectus by the Ontario Securities Commission.
Andr� Wilkens, ARM’s Chief Executive Officer, said, “TEAL presents part of the very exciting growth ARM will deliver through its unique positioning and already established credibility in Africa. We will maintain a controlling interest in TEAL post the IPO in order to fully participate in the growth potential of this asset and to meet a condition stipulated in the exchange control approval received from the South African Reserve Bank”.
TEAL intends to seek a secondary listing on the JSE Limited shortly after the IPO.
The final pricing of the IPO is scheduled for late October 2005. RBC Capital Markets is acting as sole bookrunner and as colead manager with Haywood Securities.
Rick Menell will be appointed TEAL’s President and Chief Executive Officer. Menell commented, “TEAL will have an experienced management team that is capable of advancing each of our projects and exploration assets through clearly defined and articulated milestones. We are excited about the potential for short and medium-term production, assuming our exploration work and feasibility studies prove positive.”
Wilkens added: “Having operated in Zambia and Namibia for over a decade, TEAL can now build on its relationships with the respective governments and service providers”.
ARM’s Chairman, Patrice Motsepe, has been appointed Chairman of TEAL. Other ARM directors who will serve on the TEAL board are former President of Mozambique Joaquim Chissano, Michael King, Andr� Wilkens and Frank Abbott.
Proceeds from the IPO will be used to advance four mineral projects through feasibility, and towards development, as well as exploration work to be performed on other highpriority targets.
TEAL’s assets will include four near to mediumterm development projects that it intends to progress simultaneously with the goal of achieving production in order to generate cash flow to support exploration and further development.
Konkola North Copper Project � TEAL currently 100%
Located within the greater Konkola area of the Zambian Copperbelt, Konkola North has an identified inferred mineral resource of 78.8 million tonnes at a grade of 2.14% copper. This defined resource is contained within only the east and south limb areas of the project. Historic records and more recently drilled results relating to other areas of Konkola North indicate a further inferred mineral resource of approximately 107 million tonnes at grades of 2.30% and 63 million tonnes at grades of 3.88% copper. At the south limb, TEAL intends to focus initially on the development of a highgrade region of this vast deposit by reequipping the existing infrastructure, which includes a 423 metre vertical shaft, two ventilation shafts and three ore haulage levels. Konkola North is subject to a buyin right of up to 20% (with a 5% carried interest) by ZCCM Investment Holdings plc, a company controlled by the Zambian Government.
Mwambashi Copper Project � TEAL 70%
Mwambashi is located on the Zambian Copperbelt and is held within TEAL’s Copperbelt Joint Venture Exploration Area, a joint venture with Korea Zinc Company, Limited. This project represents TEAL’s nearesttoproduction prospect. An indicated mineral resource of approximately 8.6 million tonnes at 2.43% copper and 0.07% cobalt has been identified. TEAL is currently undertaking a feasibility study that it expects to finalize within six months. Following a positive outcome, TEAL could pursue open pit development with low capital requirements due to the likely availability of nearby processing facilities.
Otjikoto Gold Project and Otavi Exploration Area � TEAL 100%
Otjikoto is located within the Otavi Exploration Area in northcentral Namibia where TEAL made a new discovery of veinhosted gold mineralization. TEAL has undertaken resource estimation work at Otjikoto and an inferred mineral resource of approximately 870,000 ounces of gold has been defined to date at a grade of 1.06g/t. TEAL’s management believes the resource is openended and has the potential for the delineation of further resources. TEAL hopes to expand and upgrade the current resource base through further drilling and expects to undertake a feasibility study within 36 months.
Kalumines CopperCobalt Project � TEAL 60%
Situated in the Democratic Republic of Congo, in close proximity to Lubumbashi, Kalumines is a joint venture with La G�n�rale des Carri�res et des Mines (“G�camines”). The project area hosts four near surface areas of copper mineralization that TEAL believes may be exploitable using openpit mining techniques. Previous owners undertook drilling, trenching and pitting and copper and cobalt mineralization was identified over a strike length of 3 kilometers. TEAL has agreed with G�camines to complete a feasibility study on the project by May 2007. Two primary areas of interest within the Kalumines area, Lupoto and Kasonta, contain historical inferred mineral resources of 6.7 million tonnes and 1.5 million tonnes, respectively. Lupoto contains grades of approximately 3.13% copper, while Kasonta is grading 5.18% copper.
Additional ARM information may be found at www.arm.co.za
A copy of TEAL’s preliminary prospectus is available at www.sedar.com but has not yet become final for the purpose of a distribution to the public.
Forward Looking Information Statements contained in this news release that are not historical facts are forwardlooking statements that involve risks, uncertainties and other factors that could cause actual results, performance, prospects and opportunities to differ materially from those expressed or implied by such forwardlooking statements. Although ARM and TEAL believe that the assumptions inherent in the forwardlooking statements are reasonable, undue reliance should not be placed on these statements, which only apply as of the date of this press release. ARM and TEAL disclaims any intention or obligation to update or revise any forwardlooking statement, whether as a result of new information, future events or otherwise. This press release shall not constitute an offer to sell or the solicitation of an offer to buy, which may be made only by means of a prospectus, nor shall there be any sale of the common shares in any state, province or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under securities laws of any such state, province or other jurisdiction. The common shares of TEAL Exploration & Mining Incorporated have not been, and will not be registered under the U.S. Securities Act of 1933, as amended, and may not be offered, sold or delivered in the United States absent registration or an application for exemption from the registration requirements of U.S. securities laws.
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