Media releases

Ergo transaction gets competition commision approval

Details

Published: Thursday, 15 April 2010 02:00

Johannesburg, South Africa. 15 April 2010. DRDGOLD Limited (JSE: DRD; Nasdaq: DROOY) announced today that South African Competition Commission approval has been obtained for its acquisition of the 50% equity interest of Mintails Limited (Mintails) in Ergo Mining (Pty) Limited (Ergo).

Ergo was created as a 50:50 joint venture by DRDGOLD and Mintails in November 2007 to explore, evaluate and process up to 1.7 billion tonnes of surface gold-, uranium- and sulphur-bearing tailings from the East and Central Rand goldfields of South Africa.

DRDGOLD announced on 21 January 2010 that it had agreed to acquire subject to certain suspensive conditions, including Competition Commission approval Mintails' 50% of Ergo for a total consideration of R82 088 321; R62 088 321 to be settled in cash and the balance in shares in the Witfontein tailings deposition site on the Far West Rand valued at R20 000 000.

All of the suspensive conditions relating to the transaction have now been met.

DRDGOLD has wholly owned the gold circuit of Ergo, known as ErgoGold, since December 2008, having acquired Mintails' 50% interest in two separate transactions worth a total of R277 million.

DRDGOLD CEO Niël Pretorius said: "Full ownership of Ergo is a major step in our strategic shift towards lower-risk, lower-cost, higher-margin gold production from surface sources, providing a key, logistical platform for substantial future growth through exploitation of synergies with our Crown surface operation".

Pretorius said DRDGOLD would also continue to explore prospects for uranium and sulphur production through Ergo's Brakpan plant

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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 2009, which we filed with the United States Securities and Exchange Commission on 27 November 2009 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.