South Africa’s Gold Fields seeks to release Sibanye as note guarantor

By Marisa Wong

Madison, Wis., March 12 – Gold Fields Orogen Holding (BVI) Ltd. said it is seeking consents from holders of its $1 billion 4 7/8% guaranteed notes due 2020 to amend the notes’ trust deed.

The notes are guaranteed by Gold Fields Ltd., Sibanye Gold Ltd., Gold Fields Operations Ltd. and Gold Fields Holdings Co. (BVI) Ltd.

The company is seeking to release the obligations of Sibanye as a guarantor of the 4 7/8% notes and make some consequential amendments to the terms and conditions of the notes, according to a press release.

Bondholders will vote on the proposed changes at a meeting to be held on April 7 in London.

Holders who deliver voting instructions in favor of the proposals before the early instruction deadline, noon ET on March 23, will be entitled to an early instruction fee of $5.00 for each $1,000 of notes.

Holders who deliver voting instructions in favor of the proposals after the early deadline but prior to the expiration of the consent solicitation, noon ET on April 1, will be eligible to receive a late instruction fee of $1.50 for each $1,000 of notes.

Background to the proposals

On Feb. 18, 2013, Gold Fields Ltd. completed the spin-off of its wholly owned subsidiary, Sibanye, formerly known as GFI Mining South Africa Pty. Ltd.

While the 4 7/8% notes benefit from Sibanye’s guarantee, all debt of Sibanye and its subsidiaries are currently secured. This means that Sibanye’s obligations under that guarantee are effectively subordinated to all of its other debt currently amounting to committed facilities of $567 million.

Out of Gold Fields’ $2.87 billion committed funding split across nine instruments as of Dec. 31, the 4 7/8% notes are the only instrument within Gold Fields’ current capital structure that carry a Sibanye guarantee.

Therefore, Gold Fields believes that releasing Sibanye from its obligations as a guarantor is a logical step following the spin-off and more accurately reflects the separation of the Gold Fields and Sibanye groups. Additionally, it would allow Gold Fields to streamline the guarantor groups offered on its own existing and future borrowings to normalize its debt profile.

J.P. Morgan Securities plc (+44 20 7134 2468, em_europe_lm@jpmorgan.com, attn.: liability management) is the solicitation agent, and D.F. King (+44 20 7920 9700 in London, 212 269-5550 or 800 370-1749 in New York, gfi@dfking.com) is the information and tabulation agent.

Gold Fields is a Johannesburg-based gold mining company.

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