Randgold in R310m gold shares payout

André Janse van Vuuren | Tue, 12 Oct 2010 14:10

[miningmx.com] -- RANDGOLD & EXPLORATION COMPANY LD (R&E) has announced its intention to distribute its stake in Gold Fields and about R65m in cash to shareholders, giving long-suffering backers something to cheer about.

In a statement released on Tuesday, the company said shareholders will receive 3.161 Gold Fields shares for every 100 ordinary shares held in R&E. A special dividend of 90 cents per share will also be paid. The total value of the distribution amounts to R310m, or 432c/share.

According to CEO Marais Steyn, the company approved the distribution on the basis that shareholders at present “probably could utilise the assets better” than the company.

"We had a lot more on our balance sheet than what our operational requirements necessitated.

"The company may reassess its strategy at some point and go back to shareholders for a rights issue, for instance, if funding is needed," Steyn said.

R&E will hold a suite of prospecting rights - including platinum, iron ore as well as gold - and about R190m in cash on completion of the distribution.

Steyn said the company is keeping an open mind on how it will extract shareholder value from its prospecting rights.

"We are not rushed to make any decisions," he said. "We will weigh up our options as opportunities present themselves. It's a big priority for us to keep our corporate profile clean and tidy."

In the wake of the fallout from Brett Kebble’s reign as CEO of R&E, the company has for the past five years focused on the recovery of misappropriated assets. After its listing was suspended for most of this period, it resumed trading on the JSE in June.

Under Kebble's reign, nearly R20bn in value was removed from the company, the bulk of it the illegal distribution of London-listed Randgold Resources shares to prop up sister company JCI.

According to spokesperson Brian Gibson, a number of legal disputes are still running, the largest of which is a R7.6bn claim against PwC which audited R&E up to December 2004.