26 February 2018

DRD: DRDGOLD LIMITED - Posting of circular, notice of general meeting, updated pro forma financial information

DRD: DRDGOLD LIMITED - Posting of circular, notice of general meeting, updated pro forma financial information
Posting of circular, notice of general meeting, updated pro forma financial information

DRDGOLD LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1895/000926/06)
JSE share code: DRD
ISIN: ZAE000058723
NYSE trading symbol: DRD
("DRDGOLD" or the "Company")

POSTING OF CIRCULAR, NOTICE OF GENERAL MEETING, SALIENT DATES AND TIMES,
UPDATED PRO FORMA FINANCIAL INFORMATION, INDEPENDENT EXPERT OPINION AND
BOARD RECOMMENDATION

Unless otherwise indicated, capitalised words and terms contained in this announcement shall bear
the same meanings ascribed thereto in the announcement published by DRDGOLD on SENS on
Wednesday, 22 November 2017 ("Transaction Announcement").

INTRODUCTION

In terms of the Transaction Announcement, Shareholders were advised of, inter alia:

-    the proposed acquisition by DRDGOLD of the WRTRP Assets, by way of the acquisition of a
     100% shareholding in WRTRP, from Sibanye-Stillwater in exchange for the allotment and issue
     by DRDGOLD of the Consideration Shares to Sibanye-Stillwater, such that Sibanye-Stillwater will
     hold approximately 38% of all DRDGOLD Shares in issue (including Treasury Shares) following
     the issue of the Consideration Shares ("Proposed Acquisition");

-    the granting of the Option to Sibanye-Stillwater to subscribe for so many new DRDGOLD Shares
     ("Issue Shares") as will result in Sibanye-Stillwater holding 50.1% of all DRDGOLD Shares in
     issue (including Treasury Shares) following the issue of the Consideration Shares and the Issue
     Shares ("Specific Issue"); and

-    the proposed waiver of the requirement for Sibanye-Stillwater to extend a mandatory offer to the
     remaining Shareholders to acquire any DRDGOLD Shares held by such persons, which results
     from Sibanye-Stillwater holding in excess of 35% of the voting securities of the Company,
     following the implementation of the Proposed Acquisition ("Proposed Waiver").

Furthermore, in order to, inter alia, give effect to the Proposed Acquisition and the Specific Issue,
DRDGOLD is required to increase the authorised ordinary share capital of the Company, by way of an
amendment to the DRDGOLD memorandum of incorporation ("DRDGOLD MOI"). DRDGOLD will also
propose additional amendments to the DRDGOLD MOI, which include the alignment of the
DRDGOLD MOI with the latest regulations.

POSTING OF THE CIRCULAR

Shareholders are advised that the circular, including revised listing particulars and the notice
convening the General Meeting ("Circular") has been posted to Shareholders today,
26 February 2018. The Circular is also available on DRDGOLD´s website: www.drdgold.com.
To obtain a thorough understanding of the Proposed Acquisition, the Specific Issue, the Proposed
Waiver and the proposed amendments to the DRDGOLD MOI, Shareholders are advised to refer to
the full terms and conditions and / or details pertaining thereto, as set out in the Circular.

GENERAL MEETING

The General Meeting of Shareholders will be held at the Company´s boardroom, 1 Sixty Jan Smuts
Building, 2nd Floor - North Tower, 160 Jan Smuts Avenue, Rosebank, Johannesburg, South Africa at
12:00 (South African time) on Wednesday, 28 March 2018 (or any postponement or adjournment
thereof) ("General Meeting") to consider and, if deemed fit, pass the resolutions set out in the notice
of general meeting attached to the Circular("Notice"), with or without modification.

SALIENT DATES AND TIMES
                                                                                           2018
Record date to determine which Shareholders are entitled to receive the     Friday, 16 February
Circular, on
Posting of the Circular to Shareholders, on                                 Monday, 26 February
Notice of posting of the Circular published on SENS, on                     Monday, 26 February
Last day to trade in DRDGOLD Shares in order to be recorded in the            Tuesday, 13 March
register and thereby be eligible to attend, speak and vote at the General
Meeting ("General Meeting LDT"), on
Date on which a Shareholder must be recorded in the register to be             Friday, 16 March
eligible to attend, speak and vote at the General Meeting ("General
Meeting Record Date"), on
Forms of proxy for Shareholders holding DRDGOLD Shares in the form             Monday, 26 March
of American Depositary Receipts to be lodged by 02:00 (Eastern
Standard Time), on
Forms of proxy for Shareholders registered on the United Kingdom               Monday, 26 March
register to be lodged by 11:00 (Greenwich Mean Time), on
Forms of proxy for Shareholders registered on the South African register      Tuesday, 27 March
to be lodged by 12:00 (South African Time), on
General Meeting to be held at 12:00 (South African Time), on                Wednesday, 28 March
Results of the General Meeting published on SENS, on or about               Wednesday, 28 March


Notes:
1. The above-mentioned dates and times are subject to change. Any change in the dates and times
   will be published on SENS as well as in the press.

2. Shareholders should note that as trades in DRDGOLD Shares are settled in the electronic
   settlement system used by Strate Proprietary Limited, settlement of trades will take place 3
   business days after such trade, therefore, persons who acquire DRDGOLD Shares after the
   General Meeting LDT, namely, Tuesday, 13 March 2018, will not be entitled to attend, speak and
   vote at the General Meeting.

3. No dematerialisation or rematerialisation of DRDGOLD Shares may take place between the date
   after the General Meeting LDT and the General Meeting Record Date.

4. Dematerialised Shareholders, other than those with "own name" registration, must provide their
   Broker or Central Securities Depositary Participant ("CSDP") with their instructions for voting at
   the General Meeting by the cut-off date and time stipulated by their Broker or CSDP in terms of
   their respective custody agreements.

5. Any form of proxy not lodged by the recommended date and time may be handed to the chairman
   of the General Meeting (or any adjournment or postponement thereof) before such Shareholder´s
   rights are exercised at the General Meeting (or any adjournment or postponement thereof).

6. If the General Meeting is adjourned or postponed, the forms of proxy submitted for the initial
   General Meeting will remain valid in respect of any adjournment or postponement of the General
   Meeting.

UPDATED PRO FORMA FINANCIAL INFORMATION

On Tuesday, 6 February 2018, DRDGOLD published pro forma financial information of DRDGOLD
which illustrated the effect of the Proposed Acquisition and the Specific Issue on the published,
audited consolidated statement of financial position of DRDGOLD as at 30 June 2017 ("Pro Forma
Financial Information"). Subsequently, on Thursday, 15 February 2018, DRDGOLD published its
unaudited operating and financial results for the six months ended 31 December 2017 ("Interim
Results").

Accordingly, in terms of paragraphs 8.25(c) and 8.28(a) of the Listings Requirements, the Pro forma
Financial Information has been updated to illustrate the effect of the Proposed Acquisition and the
Specific Issue on the Interim Results.

The table below sets out the pro forma statement of financial position of DRDGOLD which has been
prepared to illustrate the effect of the Proposed Acquisition and the Specific Issue on the published,
unaudited consolidated statement of financial position of DRDGOLD as at 31 December 2017, had
the Proposed Acquisition and the Specific Issue been implemented on 31 December 2017 ("Revised
Pro Forma Financial Information").

The Revised Pro Forma Financial Information has been compiled using the accounting policies that
comply with International Financial Reporting Standards and that is consistent with those applied in
the published, audited consolidated annual financial statements of DRDGOLD for the year ended
30 June 2017.

The Revised Pro Forma Financial Information is the responsibility of the Board and is provided for
illustrative purposes only and because of its nature, may not fairly present the financial position of
DRDGOLD after the implementation of the Proposed Acquisition and the Specific Issue.
The Revised Pro Forma Financial Information has been extracted from the Circular and should be
read alongside the independent reporting accountants´ report thereon as contained in the Circular.

                                                                                          After the
                                                                                           Proposed
                                                                                        Acquisition
                                            Proposed         After the       Specific       and the
                                         Acquisition          Proposed          issue      Specific
                               Before     Adjustment       Acquisition     Adjustment         Issue
R million                      Actual      Pro forma         Pro forma      Pro forma     Pro forma
ASSETS
Non-current assets            1 753.9         2 474.7         4 228.6              -        4 228.6
Property, plant and
equipment                     1 502.0         2 121.0         3 623.0              -        3 623.0
Investments in
rehabilitation
obligation funds                235.6           353.7           589.3              -          589.3
Investment in other
entities                         11.3                -           11.3              -           11.3
Deferred tax asset                5.0                -            5.0              -            5.0

Current assets                  625.7            (7.4)          618.3          578.0        1 196.3
Inventories                     242.7                -          242.7              -          242.7
Trade and other
receivables                      88.4                -           88.4              -           88.4
Cash and cash
equivalents                     294.6            (7.4)          287.2          578.0          865.2


TOTAL ASSETS                  2 379.6         2 467.3         4 846.9          578.0        5 424.9

EQUITY AND
LIABILITIES
Equity
Equity                        1 344.4         2 241.6         3 586.0          578.0        4 164.0

Non-current liabilities         742.6           222.5           965.1              -          965.1
Provision for
environmental
rehabilitation                  546.5           222.5           769.0              -          769.0
Deferred tax liability          154.2               -           154.2              -          154.2
Employee benefits                26.4               -            26.4              -           26.4
Finance lease
obligation                       15.5               -            15.5              -           15.5

Current liabilities             292.6             3.2           295.8              -          295.8
Trade and other
payables                        275.8             3.2           279.0              -          279.0
Current tax liability             6.6               -             6.6              -            6.6
Employee benefits                10.2               -            10.2              -           10.2

TOTAL LIABILITIES             1 035.2           225.7         1 260.9              -        1 260.9

TOTAL EQUITY AND
LIABILITIES                   2 379.6         2 467.3         4 846.9          578.0        5 424.9

Net asset value per
share (SA cents per
share)                          318.5           845.9           521.9                         487.1
Tangible net asset
value per share (SA
cents per share)                318.5           845.9           521.9                         487.1
 
Number of shares in
issue                     431 429 767     265 000 000      696 429 767   167 733 616   864 163 383
Treasury shares held
by Ergo Mining
Operations                  9 361 071               -        9 361 071             -     9 361 071
Number of Shares in
issue less treasury
shares                    422 068 696     265 000 000      687 068 696   167 733 616   854 802 312


 Notes:
 1. The "Before" financial information has been extracted without adjustment and / or derived from
    the published, unaudited interim financial statements of DRDGOLD as at 31 December 2017.

 2. The "After the Proposed Acquisition" column has been derived from the published, unaudited
    interim financial statements of DRDGOLD as at 31 December 2017 and adjusted for:
    a. The reviewed historical financial information of WRTRP as at and for the six months ended
        30 June 2017.
    b. Property, plant and equipment has been adjusted to take into account the fair value of the
        WRTRP Assets as contained in the Competent Persons Report, a summary of which is
        contained in the Circular. The fair value of the WRTRP Assets is based on management´s
       strategic intent of developing the long term project over a 20 year life-of-mine and was based
       on a forecast gold price of R564 245 per kilogram and a real discount rate of 6%.
   c. The payment of transaction costs directly attributable to the Proposed Acquisition amounting
       to R7.4 million, of which R0.4 million is capitalised to share capital and R7.0 million is
       recognised as an expense.
   d. The provision for the environmental rehabilitation was adjusted to allow for a market
       participant´s views in settling the liability. The pro forma includes adjustments to the
       estimated timing and manner of settling the expected environmental liability relating to the
       WRTRP Assets. The provision for environmental rehabilitation excludes the Excluded
       Dumps that will only be transferred after being decommissioned by Sibanye-Stillwater.
   e. The deferred tax liability for the asset acquisition of the WRTRP Assets has been adjusted to
       Rnil in line with IAS 12 Income Tax initial recognition exemption.
   f. The issue of 265 million Consideration Shares to Sibanye-Stillwater as consideration for the
       Proposed Acquisition.

3. The "After the Proposed Acquisition and the Specific Issue" column has been derived from the
   published, unaudited interim financial statements of DRDGOLD as at 31 December 2017 and
   adjusted for the adjustments included in note 2 above and for:
   a. The issue of approximately 168 million Issue Shares for cash to Sibanye-Stillwater, following
       the exercise of the Option, based on 30 day VWAP of 383.20 cents less a 10% discount as
       at 9 February 2018 Sibanye-Stillwater shall be entitled, subject to Sibanye-Stillwater not
       having disposed of all or any of the Consideration Shares, to exercise the Option any time
       during the period commencing on the date of implementation of the Proposed Acquisition
       and expiring 24 months thereafter ("Option Period"). The Option must be exercised in whole
       anytime within the Option Period. The price per Issue Share shall be the 30 day VWAP at the
       time of the exercise of the Option, less 10%.
   b. The payment of transaction costs directly attributable to the Specific Issue amounting to
       R0.4 million, of which R0.2 million is capitalised to share capital and R0.2 million is
       recognised as an expense.

4. Subsequent events:
   a. On 31 January 2018, the Constitutional Court dismissed ("CC Order") Ergo Mining
       Proprietary Limited´s ("ERGO") application for leave to appeal against the judgment of
       August 2017 of the Full Bench of the South Gauteng High Court ("Full Bench Order"). The
       Full Bench Order overturned the Ekurhuleni Metropolitan Council´s ("Municipality") appeal
       against the order of the South Gauteng High Court of May 2016 ("Interim Order") in terms of
       which ERGO was successful in seeking to have the Municipality restrained from exercising
       self-help and its alleged credit control and debt collection measures by threatening to
       terminate the electricity supply at the ERGO Central Substation ("Substation"). As a
       consequence of the CC Order, the interdict restraining the Municipality has been set aside
       and ERGO may now have to pay the Municipality the surcharges levied by the Municipality
       plus interest thereon which were paid under protest into the trust account of ERGO´s
       attorneys in order to prevent the possible discontinuation of power supply to the Ergo Plant
       (R111.1 million at 31 December 2017). Full details are set out in the Circular.
   b. On 9 February 2018, a dividend of 5 cents per qualifying share (R21.1 million) was approved
       by the Board as an interim dividend for 2018. The dividend was not adjusted for in the
       Revised Pro Forma Financial Information and does not have any tax impact on the
       Company.

5. Other than disclosed in note 4, there are no subsequent events that require adjustment to the
   Revised Pro Forma Financial Information.

INDEPENDENT EXPERT OPINION AND BOARD RECOMMENDATION

The Board appointed Imara Corporate Finance Proprietary Limited ("Imara") as the independent
expert for purposes of preparing an opinion in respect of the Proposed Waiver in accordance with
Regulation 86(7) ("Independent Expert Report"). Imara has considered the proposed terms and
conditions of the Proposed Acquisition and is of the opinion that it is fair and reasonable for
Shareholders to approve the Proposed Waiver.

A copy of the Independent Expert Report is included in the Circular.

Having regard to the terms and conditions of the Proposed Acquisition and the Specific Issue, the
details pertaining to the Proposed Waiver and proposed amendments to the DRDGOLD MOI and the
Independent Expert Report, the Board unanimously recommends that Shareholders vote in favour of
the resolutions set out in the Notice. Each of the Directors who hold DRDGOLD Shares intend to vote
his or her DRDGOLD Shares in favour of resolutions set out in the Notice.


Johannesburg
26 February 2018


Sponsor
One Capital

Auditors and reporting accountants
KPMG Incorporated

Independent Expert
Imara Corporate Finance Proprietary Limited


Forward Looking Statements
This announcement contains statements relating to certain projections and business trends that are
forward-looking, including statements with respect to the Proposed Transaction, pro forma financial
information, average gold price and the other assumptions upon which the pro forma financial
information was prepared. These statements are not historical facts, but rather are based on current
expectations, estimates, assumptions and projections about the business and future financial results
and readers should not place undue reliance on them. Forward-looking statements do not guarantee
future performance and involve risks and uncertainties. These risks and uncertainties include, without
limitation, economic conditions, the Proposed Transaction not being implemented, failing to receive
expected benefits from the Proposed Transaction, incorrect assumptions, adverse changes or
uncertainties in general economic conditions in the markets we serve, a drop in the gold price, a
sustained strengthening of the rand against the dollar, regulatory developments adverse to
DRDGOLD or difficulties in maintaining necessary licenses or other governmental approvals, changes
in DRDGOLD´s competitive position, changes in business strategy, any major disruption in production
at key facilities or adverse changes in foreign exchange rates and other risks indicated in the risk
factors included in DRDGOLD´s Annual Report on Form 20-F and other filings with the US Securities
and Exchange Commission. These forward-looking statements are made only as of the date of this
announcement. DRDGOLD does not undertake to update or revise the forward-looking statements,
whether as a result of new information, future events or otherwise.

Date: 26/02/2018 03:35:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
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