Trinity Asset Management (Pty) Ltd (“Trinity”), on behalf of its various funds, today reached a settlement agreement with the directors of Randgold & Exploration Company Limited (“Randgold”) which will see Trinity support the proposed merger of Randgold and JCI Limited (“JCI”) on the basis of 95 JCI shares for every 1 Randgold share.
Trinity has undertaken to withdraw its High Court application to stop the directors of Randgold from involving themselves in the settlement of Randgold’s claims against JCI. Trinity also agreed to withdraw its Application to set aside Randgold’s General Meeting held on 9 March 2007.
As part of the settlement agreement Peter Gray, CEO of Randgold, confirmed his public undertaking to resign from the boards of Randgold and JCI should the mediation fail and the matter proceed to arbitration.
“I believe I can play a constructive role as the CEO of both companies while a mediated settlement and merger is still a possibility. Clearly, I would be conflicted if the matter went to arbitration or litigation and I have always said I would automatically stand down should this happen,” said Gray.
David Nurek, who is chairman of both Randgold and JCI, has also confirmed his intention to resign as a director immediately following the shareholders meeting to vote on the merger proposal.
In his letter of resignation from both boards, Nurek said: “I have given the matter a great deal of thought and have decided that, whatever the outcome of the shareholder votes in respect of the merger, I am going to step down from the Boards of both Randgold and JCI.I have arrived at this decision in the context of understanding that at the time of the shareholder vote in respect of the merger, I will have completed my mandate in relation to my appointment to the respective Boards.”
As part of the settlement agreement, Trinity will be entitled to propose a candidate to the board of Randgold for consideration. Both parties have also agreed to retract all allegations of improper conduct made against one another in their affidavits relating to the cases.
Quinton George, CEO of Trinity, said the settlement finally paves the way for the merger of JCI and Randgold to go ahead.
“This is a commercially viable solution which suits both parties and will allow the directors to concentrate on unlocking value for shareholders in the two companies.”
George pointed out that this settlement does not relate to the outstanding case Trinity brought against Investec relating to the validity of their Loan Agreement (ILA) to JCI.
“We expect that judgement on whether we have ‘locus standi’ to bring our claim will be handed down sometime this week or next. Our legal advisors are optimistic that we have a strong case,” said George.
Gray has welcomed the settlement, saying that scarce executive resources could be better utilised on the preparation of a detailed circular to shareholders setting out the terms and conditions of the proposed merger.
For further information contact:
Trinity Holdings (Pty) Limited
On behalf of JCI Limited and Randgold & Exploration Company Limited
083 253 5988