Media releases

Acquisition of interests in Porgera and Tolukuma by Emperor Mines Limited from DRDGOLD limited Emperor to become the third largest gold producing company on ASX

Details

Published: Thursday, 17 November 2005 02:00

DRDGOLD Limited (“DRDGOLD”) and Emperor Mines Limited have today signed a sale and purchase agreement for Emperor to acquire DRDGOLD’s Papua New Guinea (“PNG”) assets comprising a 20% interest in the Porgera Joint Venture (“Porgera”), a 100% interest in the Tolukuma Gold Mine (“Tolukuma”) and all DRDGOLD’s exploration tenements in PNG (together the “Gold Assets”)(the “Transaction”).

Joint Announcement

DRDGOLD Limited (“DRDGOLD”) (JSE: DRD, ASX: DRD, NASDAQ:DROOY) and Emperor Mines Limited (“Emperor”)(ASX:EMP) have today signed a sale and purchase agreement for Emperor to acquire DRDGOLD’s Papua New Guinea (“PNG”)assets comprising a 20% interest in the Porgera Joint Venture (“Porgera”), a 100% interest in the Tolukuma Gold Mine (“Tolukuma”) and all DRDGOLD’s exploration tenements in PNG (together the “Gold Assets”)(the “Transaction”).

The Transaction, if approved by shareholders in both companies, would elevate Emperor to become the third largest gold producing company listed on the Australian Stock Exchange (“ASX”) with combined production of over 375,000 ounces per annum and reserves and resources of 2.2 million and 7.6 million ounces of gold respectively.

The Directors of Emperor and DRDGOLD unanimously recommend shareholders approve the transaction.

Emperor Chairman, Mr Jim Wall, said the transaction would deliver increased shareholder value, substantially boost the company’s asset base and provide improved growth opportunities through increased access to capital.

“This proposed transaction provides us with a 20% stake in Porgera, one of the most profitable gold projects in the world, 100% of Tolukuma in PNG, DRDGOLD’s entire portfolio of exploration tenements in PNG – the biggest tenement holding in PNG - and our continued operation of the Vatukoula Gold Mine in Fiji,” Mr Wall said.

“As a one project company, Emperor shareholders are entirely dependant on the performance of Vatukoula and any exploration opportunities we can exploit in Fiji. The proposed acquisition provides enhanced diversification of assets.

“This opportunity allows us increased access to capital through the company’s stronger financial base, providing us improved scope for stronger growth.”

DRDGOLD Chief Executive Officer, Mr Mark Wellesley-Wood, who has also served as Emperor’s Managing Director for the past two years, said the transaction was a sensible consolidation of South Pacific projects.

“We believe this transaction provides a clearer growth strategy going forward, with the assistance of an established and dedicated team of mining professionals based in Brisbane who can manage the operations and identify future acquisition opportunities in the region,” Mr Wellesley-Wood said.

“Through the purchase of Porgera and Tolukuma, Emperor’s financial and operational future is enhanced through the acquisition of lower cash cost assets while allowing Emperor’s shareholders to benefit from operational and geographic diversification.”