Media releases

DRDGOLD to proceed with R100 million+ claim against JCI

Details

Published: Wednesday, 22 November 2006 02:00

DRDGOLD Limited today re-iterated its intention to proceed with a claim in excess of R100 million against JCI Limited (JCI).
Johannesburg, South Africa, 22 November 2006 – DRDGOLD Limited (DRDGOLD) (JSE: DRD; NASDAQ: DROOY) – previously Durban Roodepoort Deep, Limited (DRD) – today re-iterated its intention to proceed with a claim in excess of R100 million against JCI Limited (JCI).

The claim relates to the invalid issue of 8 282 056 DRD shares during Mr Roger Kebble’s chairmanship of DRD in 1999 for the acquisition from Laverton Gold NL of the Rawas mine in Indonesia at an attributed value of R122.6 million. Consolidated African Mines Limited (subsequently renamed JCI Limited), of which Kebble was also a director, and its associates, were major creditors and shareholders of Laverton at the time.

Subsequent investigations by DRDGOLD, now headed by Mark Wellesley-Wood, indicated that:

• Rawas had no value at the time of the share issue;
• Laverton was insolvent and indebted to, amongst other companies, JCI, which held a 19.5% stake; and
• the 8 282 056 DRDGOLD shares were invalidly allotted and issued to Laverton’s creditors, including JCI and its associates.

DRDGOLD subsequently instituted action against JCI and others for recovery of an amount in excess of R100 million.

Wellesley-Wood said today that it was important for DRDGOLD to re-iterate its intention to proceed with the claim in light of a statement contained in a JCI circular to shareholders relating to a loan agreement with Investec, issued on 14 September 2006.

The circular states that the claim was settled during August 2005 but that DRDGOLD alleges that the settlement was not finally concluded.

“With the benefit of hindsight it comes as no surprise that Mr Brett Kebble, on behalf of JCI and others, pursued with extreme haste settlement discussions with DRDGOLD up to and during August 2005, prior to public announcements about an Investec rescue package for JCI,” Wellesley Wood said.

”DRDGOLD knew nothing about the rescue package and continued to believe that JCI was in a parlous financial state. Brett Kebble had approached me in April 2005, when he must have been under enormous personal pressure and JCI was facing insolvency, and the prospect of an all-in settlement therefore made obvious sense.

“However,it was clearly stated and accepted that any agreement would have to be concluded formally and that Brett Kebble/JCI would have to pay money under the deal, and meet other conditions before DRDGOLD would sign. No money, no deal.

“We can demonstrate that the conditions for a settlement agreement were never met and, as a result, no settlement was reached. So, DRDGOLD will be proceeding with its valid claim,” Wellesley-Wood confirmed.

Queries:

South Africa
Investor and Media Relations
Ilja Graulich, DRDGOLD
+27 11 219 8707(office)
+27 83 604 0820 (mobile)

James Duncan, Russell & Associates
+27 11 880 3924 (office)
+27 82 892 8052 (mobile)

North America
Investor and Media Relations
Barbara Cano, Breakstone Group International
+1 646 452 2334 (office)

United Kingdom/Europe
Investor and Media Relations
Phil Dexter, St James's Corporate Services
+44 20 7499 3916 (office)
+44 779 863 4398 (mobile)

---

DRDGOLD is a medium-sized, unhedged gold producer with investments in South Africa and Australasia.
Incontrovertibly bullish about its product, the company has recently concluded extensive refocusing of its gold interests.

In South Africa, the company has an 85% interest in DRDGOLD South African Operations (Pty) Limited (DRDGOLD SA), while in Australasia, it has a 78.72% interest in Emperor Mines Limited.

In the 2006 financial year, DRDGOLD SA contributed 60% or 315 976 ounces – of total attributable gold production of 527 401 ounces, and Emperor 211 425 ounces. At 30 June 2006, DRDGOLD’s total attributable resource base was 47.6 million ounces and its total attributable reserves were 8.8 million ounces.

For more information, please visit www.drdgold.com

---

Disclaimer:

Many factors could cause the actual results, performance or achievements to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements, including, among others, adverse changes or uncertainties in general economic conditions in the markets we serve, a drop in the gold price, a continuing strengthening of the rand against the dollar, regulatory developments adverse to DRDGOLD or difficulties in maintaining necessary licences 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 various other factors.

These risks include, without limitation, those described in the section entitled "Risk Factors" included in our annual report for the fiscal year ended 30 June 2005, which we filed with the United States Securities and Exchange Commission on 15 December 2005 on Form 20-F. You should not place undue reliance on these forward-looking statements, which speak only as of the date thereof. We do not undertake any obligation to publicly update or revise these forward-looking statements to reflect events or circumstances after the date of this report or to the occurrence of unanticipated events.