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Agreement to dispose of Evander Gold Mines Limited to Pan African Resources Plc

  1. Introduction

    Shareholders are informed that Harmony has entered into an agreement with PLC (“Pan African Resources”) in terms of which Harmony will dispose of Evander Gold Mines Limited (“Evander”) to Pan African Resources (the “Transaction”).

  2. The transaction

    2.1 Salient Terms

    Pan African Resources (through a wholly-owned subsidiary) will acquire Evander for a cash purchase consideration of R1.5 billion to be funded through a combination of internal cash resources, third party debt and equity.

    2.2 Effective date and Conditions Precedent

    The effective date of the Transaction is 1 April 2012. The closing date of the Transaction is intended to be 31 October 2012 unless extended, subject to, inter alia, the fulfilment of the following conditions precedent:

    • Pan African Resources obtaining the relevant shareholder approval for the Transaction;
    • Obtaining of all relevant regulatory approvals including exchange control approval from the Reserve Bank of South Africa, any required approvals from the various exchanges on which Pan African Resources is listed and Competition Commission approval. The Takeover Regulation Panel has exempted Evander from complying with Parts B and C of the Companies Act, 2008 (No. 71 of 2008) and the Takeover Regulations on the basis that, although Evander is a public company, it is a wholly owned subsidiary of Harmony; and
    • Approval of the change in control of Evander by the Department of Mineral Resources.

    A break fee of R50 million will be payable by Pan African Resources and will not be refundable unless the regulatory approvals described above are not fulfilled.

“We are pleased that Evander is being sold at a value within our value range. The proceeds will be received within the next six months, provided all the conditions precedent are met, which will further strengthen our cash position to meet our capital demands in support of our growth strategy”, said Graham Briggs, chief executive of Harmony.

The Transaction is below the threshold prescribed by the JSE Listing Requirements for a categorised transaction and this announcement is therefore made on a voluntary basis.

30 May 2012

Financial Advisor and Transaction Sponsor

Merrill Lynch South Africa (Pty) Ltd

Legal Advisor

Cliffe Dekker Hofmeyr Incorporated

Sponsor

JP Morgan

For more details contact:

Henrika Basterfield
Investor Relations Officer
+27 82 759 1775(mobile)

Marian van der Walt
Executive: Corporate and Investor Relations
+27 (0) 82 888 1242 (mobile)

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