REG-Petra Diamonds: Tender Offer

Petra DiamondsAnnouncement

13/09/2022 07:15

13 September 2022   LSE: PDL 

Petra Diamonds Limited
(“Petra”)

Petra’s wholly owned subsidiary, Petra Diamonds US$ Treasury Plc, has today
made the following announcement on the Irish Stock Exchange:

FOR IMMEDIATE RELEASE

This announcement is not an invitation to participate in a tender offer with
respect to any Notes (as defined below). The Offer (as defined below) is being
made solely pursuant to the Tender Offer Memorandum (as defined below) which
sets forth the complete terms of the Offer.

This announcement and any materials relating to the Offer do not constitute,
and may not be used in connection with, any form of offer or solicitation in
any place where such offers or solicitations are not permitted by law.

The distribution of this announcement in certain jurisdictions may be
restricted by law. Persons into whose possession this announcement comes are
required to inform themselves about, and to observe, any such restrictions.

THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. IF YOU ARE
IN DOUBT ABOUT THE ACTION YOU SHOULD TAKE, YOU SHOULD CONSULT IMMEDIATELY YOUR
STOCKBROKER, BANK MANAGER, SOLICITOR, ACCOUNTANT OR APPROPRIATELY AUTHORISED
INDEPENDENT FINANCIAL ADVISER.

Petra Diamonds US$ Treasury Plc

Company Number: 09518557

(the "Offeror")

Announces an Offer to Purchase for Cash in a Modified Dutch Auction up to
$150,000,000 in aggregate total cash consideration of its outstanding
$336,656,000 in aggregate notional principal amount of Senior Secured Second
Lien Notes due 2026

(ISIN No. XS2289899242, Common Code 228989924 (Private Placement))
(ISIN No. XS2289895927, Common Code 228989592 (Regulation S))

 13 September 2022    

Petra Diamonds US$ Treasury Plc (the "Offeror") has today launched an offer
(the "Offer") to holders (the "Noteholders") to submit tenders to sell to the
Offeror for cash the $336,656,000 Senior Secured Second Lien Notes due 2026
(the "Notes") up to a maximum consideration of $150,000,000 (the "Acceptance
Consideration"), subject to the offer and distribution restrictions set out
below, and upon the terms and subject to the conditions set forth in a tender
offer memorandum dated September 13, 2022 (as it may be amended or
supplemented from time to time, the "Tender Offer Memorandum") in accordance
with a modified Dutch auction procedure.

Capitalised terms used in this announcement but not otherwise defined have the
meanings given to them in the Tender Offer Memorandum. Copies of the Tender
Offer Memorandum are available, subject to the offer and distribution
restrictions and registration, from the Offer Website:
https://deals.is.kroll.com/petradiamonds.

Summary of the Offer

 Description of                                                                                                                               ISIN/Common Code                        Outstanding Notional Principal Amount ((1))  Early Tender Premium ((2)(3))                    Total Consideration ((2)(3))                   Total Consideration Acceptable Bid Range ((2)(3))  
 the Notes                                                                                                                                                                                                                                                                                                                                                                            
   $336,656,000 in aggregate notional principal amount of Senior Secured Second Lien Notes due 2026 (the “ Notes ”)    Private Placement : ISIN: XS2289899242 Common code: 228989924  $336,656,000                                              $50               To be determined pursuant to a modified Dutch auction procedure                    $970 to $1,010                   
                                                                                                                       Regulation S : ISIN: XS2289895927 Common code: 228989592       

(1) Represents the notional outstanding principal amount. The actual principal
amount after application of a pool factor of 1.14362 is $385,006,534.72.
Unless stated otherwise, all references to outstanding principal in this
announcement are to the notional outstanding principal amount prior to the
application of the pool factor.

(2) Per $1,000 of principal amount of Notes.

(3) Total Consideration per $1,000 of principal amount of Notes includes the
Early Tender Premium and will be multiplied by the pool factor of 1.14362.
Total Consideration will only be paid to Noteholders validly tendering their
Notes at or prior to the Early Participation Deadline and accepted by the
Offeror. Noteholders validly tendering their Notes after the Early
Participation Deadline and accepted by the Offeror will receive the Tender
Consideration, which is equal to the Total Consideration minus the Early
Tender Premium.

The Offeror intends to accept for purchase validly tendered Notes up to the
Acceptance Consideration. Acceptance of Notes tendered may be subject to
scaling as described herein. The Offeror reserves the right, in its sole and
absolute discretion, to amend the Acceptance Consideration to accept
significantly more than or significantly less than the Acceptance
Consideration, or to accept none of such Notes, for purchase pursuant to the
Offer, not to accept any tender or purchase Notes or to modify in any manner
any of the terms and conditions of the Offer.

Tender Instructions submitted on or prior to the Early Participation Deadline
will be accepted in priority to those Tender Instructions submitted after the
Early Participation Deadline.

Assuming the Acceptance Consideration has not been met at the Early
Participation Deadline, Noteholders validly tendering their Notes after the
Early Participation Deadline but on or prior to the Expiration Deadline will
only be eligible to receive the Tender Consideration. The Offeror may choose
not to accept any Tender Instructions submitted after the Early Participation
Deadline. No accrued interest will be payable in addition to the Total
Consideration.

No accrued interest will be payable in addition to the Total Consideration or,
with respect to Tender Instructions submitted after the Early Participation
Deadline, the Tender Consideration.

Rationale for the Offer

The purpose of the Offer is to enable the Offeror to manage its overall
funding level and to reduce its gross debt, while maintaining a prudent
approach to liquidity.

Total Consideration

The Offeror will pay per $1,000 of principal amount (to be multiplied by a
pool factor of 1.14362 (the "Pool Factor")) of the Notes validly tendered and
accepted by it for purchase pursuant to the Offer a cash purchase price (the
“Total Consideration”), as determined pursuant to the Modified Dutch
Auction Procedure, as defined below. The Total Consideration will be not less
than $970 (the “Minimum Total Consideration”) nor more than $1,010 (the
“Maximum Total Consideration”) per $1,000 of principal amount of the Notes
and shall be an amount that is a multiple of $1,000. The Total Consideration
is inclusive of the Early Tender Premium of $50 per $1,000 of principal amount
of the Notes. Such Total Consideration is payable only to the Noteholders who
validly tender their Notes prior to the Early Participation Deadline and the
Offeror accepts such validly tendered Notes for purchase. No accrued interest
will be payable.

No Accrued Interest

No accrued interest will be payable in addition to the Total Consideration or,
with respect to Tender Instructions submitted after the Early Participation
Deadline, the Tender Consideration.

Modified Dutch Auction Procedure

The amount that the Offeror will pay per $1,000 of principal amount of the
Notes validly tendered and accepted for purchase pursuant to the Offer will be
determined pursuant to a modified Dutch auction procedure (the “Modified
Dutch Auction Procedure”).

Under the Modified Dutch Auction Procedure, the Offeror will determine, in its
sole discretion, for the Notes tendered prior to the Early Participation
Deadline, as soon as practicable following the Early Participation Deadline,
(a) the Acceptance Consideration and (b) the Total Consideration (expressed as
the amount payable per $1,000 of principal amount of Notes), taking into
account the principal amount of the Notes so tendered and the Total
Consideration Bid Prices specified (or deemed to be specified, as set out
below) by tendering Noteholders.

The Total Consideration for the Notes will represent the lowest price that
will enable the Offeror to purchase an aggregate principal amount of the Notes
for which the total consideration paid by the Offeror will not exceed the
Acceptance Consideration and shall be an amount that is a multiple of $1.00.

If the total amount of Tender Instructions received by the Offeror is less
than the Acceptance Consideration, then the Total Consideration will be
equivalent to the Maximum Total Consideration.

Tender Instructions may be submitted in the form of either a Competitive Offer
or a Non-Competitive Offer. Competitive Offers can only be submitted prior to
the Early Participation Deadline.

Competitive Offers

Noteholders may submit one or more Competitive Offers in respect of the Notes
on or prior to the Early Participation Deadline, provided that the aggregate
principal amount of the Notes that are the subject of these Competitive
Offers, together with the aggregate principal amount of the Notes that are the
subject of any Non-Competitive Offers submitted by each such Noteholder, does
not exceed the aggregate principal amount of the Notes that each such
Noteholder holds. Competitive Offers must specify:
1. a purchase price per $1,000 of aggregate principal amount of the Notes, in
increments of $1.00, which is above the Minimum Total Consideration and at or
below the Maximum Total Consideration, that such Noteholder would be willing
to accept as the Total Consideration in respect of Notes that are the subject
of the particular Tender Instruction (the “Total Consideration Bid
Price”); and
2. the principal amount of the Notes, in minimum denomination of $1,000 and in
integral multiples of $1.00 in excess thereof, that the relevant Noteholder is
tendering at that Total Consideration Bid Price.
If a Competitive Offer specifies a purchase price that is not in increments of
$1.00, such purchase price will be rounded up to the nearest number divisible
by $1.00.

If the Offeror accepts a Competitive Offer (or Competitive Offers), the
relevant Noteholder will receive the Total Consideration for the Notes. In
respect of each Competitive Offer (or Competitive Offers) that is accepted,
the Offeror will pay the Total Consideration to each Noteholder whose
Competitive Offer of Notes is accepted, even if the Total Consideration is
higher than the Total Consideration Bid Offer Price specified by the tendering
Noteholder in its Tender Instruction. In the event that the Competitive Offers
submitted at the Total Consideration (following acceptance of all
Non-Competitive Offers as described below) result in more Notes being offered
than the Acceptance Consideration, such Competitive Offers will be accepted on
a pro rata basis, as described below.

Non-Competitive Offers

Alternatively, Noteholders may submit one or more Non-Competitive Offers in
respect of the Notes on or prior to the Expiration Deadline. Non-Competitive
Offers must specify the principal amount of the Notes, in minimum denomination
of $1,000 and in integral multiples of $1.00 in excess thereof, that the
relevant Noteholder is offering pursuant to such Non-Competitive Offer,
provided that the aggregate principal amount of the Notes that are the subject
of these Non-Competitive Offers, together with the aggregate principal amount
of the Notes that are the subject of any Competitive Offers submitted by each
such Noteholder, does not exceed the aggregate principal amount of the Notes
that each such Noteholder holds.

Tender Instructions that (i) do not specify a Total Consideration Bid Price,
(ii) specify a Total Consideration Bid Price equal to the Minimum Total
Consideration or (iii) are received after the Early Participation Deadline
will be treated as Non-Competitive Offers. Each Non-Competitive Offer falling
within (i) or (ii) above, if received on or prior to the Early Participation
Deadline, will be deemed to have specified the Minimum Total Consideration.
Each Non-Competitive Offer submitted after the Early Participation Deadline
will be deemed to have specified the Tender Consideration. Tender Instructions
which specify a Total Consideration Bid Price more than the Maximum Total
Consideration or less than the Minimum Total Consideration will not be
accepted.

A separate Tender Instruction must be submitted on behalf of each beneficial
owner of the Notes due to possible scaling.

The Offeror will accept all Non-Competitive Offers if it accepts any
Competitive Offers. If the Offeror accepts a Non-Competitive Offer, the
relevant Noteholder will receive the Total Consideration for the Notes (or, if
such Non-Competitive Offer was submitted after the Early Participation
Deadline, the Tender Consideration). In the event that the Non-Competitive
Offers submitted would result in total consideration paid by the Offeror that
is higher than the Acceptance Consideration, such Non-Competitive Offers will
be accepted on a pro rata basis, as described below.

Acceptance of Tender Instructions

Once the Offeror has determined the Total Consideration and the Acceptance
Consideration for the Notes, the Offeror will accept Tender Instructions
validly submitted on or prior to the Early Participation Deadline in the
following order:
1. all validly submitted Non-Competitive Offers will be accepted first,
subject to possible scaling in the event that Tender Instructions in respect
of such Non-Competitive Offers have been submitted that would result in a
greater total consideration paid by the Offeror than the Acceptance
Consideration;
2. all validly submitted Competitive Offers that specify Total Consideration
Bid Prices lower than the Total Consideration will be accepted second; and
3. all validly submitted Competitive Offers that specify Total Consideration
Bid Prices equal to the Total Consideration will be accepted third, subject to
possible scaling in the event that such Competitive Offers, when aggregated
with all Tender Instructions referred to above and accepted for purchase,
would result in a greater total consideration paid by the Offeror than the
Acceptance Consideration.
Such pro rata allocations will be calculated by multiplying the aggregate
principal amount of the Notes represented by each Tender Instruction subject
to scaling by a factor (the “Scaling Factor”) derived from (i) the maximum
amount of notes that could be purchased taking into account the Acceptance
Consideration less the aggregate principal amount of the Notes accepted for
purchase not subject to scaling, divided by (ii) the aggregate principal
amount of the Notes validly tendered in the Offer that are subject to scaling.
Each tender of Notes reduced in this manner will be rounded down to the
nearest $1.00 in aggregate notional principal amount. In the event of any
scaling on a pro rata basis and such scaling would result in either (i) the
Offeror accepting Notes from the relevant Noteholder in an aggregate principal
amount of less than $1,000 or (ii) the principal amount of Notes not purchased
and returned back to the relevant Noteholder being an aggregate principal
amount of less than $1,000, the Offeror may elect to accept or reject such
Tender Instructions in full.

If the Offeror accepts tenders of Notes for purchase on a pro rata basis,
Noteholders will only receive the Total Consideration (or, with respect to
Tender Instructions submitted after the Early Participation Deadline, the
Tender Consideration) in respect of those Notes validly tendered and accepted
for purchase by the Offeror. All Notes not accepted as a result of scaling
will be returned to Noteholders.

If at the Early Participation Deadline the aggregate principal amount of Notes
validly tendered  by Noteholders would result in a greater total
consideration paid by the Offeror than the Acceptance Consideration, the
Offeror may not accept any Notes tendered by Noteholders after the Early
Participation Deadline. In such case, any Notes tendered after the Early
Participation Deadline and on or prior to the Expiration Deadline will not be
accepted for purchase by the Offeror and shall be promptly returned without
cost to the tendering Noteholder. If the Offer is oversubscribed at the Early
Participation Deadline, then the Offeror will issue an announcement promptly
after the Early Participation Deadline stating that Notes tendered after the
Early Participation Deadline will not be purchased pursuant to the Offer and
Notes tendered before the Early Participation Deadline may be subject to
scaling.

If at the Early Participation Deadline the aggregate principal amount of Notes
validly tendered by Noteholders would result in a total consideration paid by
the Offeror that is less than the Acceptance Consideration, the Offeror
expects to accept for purchase all Notes validly tendered at or prior to the
Early Participation Deadline without scaling, subject to the satisfaction or
waiver of the Transaction Conditions set forth in this Tender Offer
Memorandum. In such case, the Offeror also expects to accept for purchase
Notes validly tendered after the Early Participation Deadline and on or prior
to the Expiration Deadline, up to a total consideration paid by the Offeror
equal to the Acceptance Consideration, and only Notes tendered after the Early
Participation Deadline and on or prior to the Expiration Deadline, to the
extent that the aggregate principal amount of all Notes tendered as of the
Expiration Deadline would result in a greater total consideration paid by the
Offeror than the Acceptance Consideration, will be subject to scaling.

If the Offeror decides to increase or decrease the Acceptance Consideration or
adjust the Early Tender Premium, it will announce any such change during the
pendency of the Offer. If the Acceptance Consideration is increased or
decreased or the Early Tender Premium is adjusted and there are fewer than 10
Business Days until the scheduled Expiration Deadline, the Offeror will extend
the Offer so that at least 10 Business Days remain until the Expiration
Deadline.

Notes offered for purchase at a Total Consideration Bid Price higher than the
Total Consideration of the Notes will not be accepted pursuant to the Offer.
The Offeror may elect not to purchase any Notes.

The determination of the Total Consideration by the Offeror will, in the
absence of manifest error, be final and binding on all parties.

Early Tender Premium

Any Noteholder who validly tenders its Notes prior to the Early Participation
Deadline will be entitled to receive a fee of $50 per $1,000 of principal
amount of Notes for the Notes accepted for purchase in the Offer (the “Early
Tender Premium”), with such Early Tender Premium included in the Total
Consideration and payable on the Early Settlement Date. Noteholders whose
Notes are not accepted for purchase or who validly tender their Notes after
the Early Participation Deadline, but prior to the Expiration Deadline,
assuming the Acceptance Consideration has not been met, will be eligible to
receive the Tender Consideration, and will not receive any other additional
cash consideration.

Further Information

The Offeror has appointed Kroll Issuer Services Limited to act as Information
and Tender Agent. The Tender Offer Memorandum and all announcements and
supporting documentation in relation to the Offer will be posted on the
website operated by the Information and Tender Agent for purposes of the Offer
(the "Offer Website"): https://deals.is.kroll.com/petradiamonds 

An indicative timeline for the Offer is set out below:

 Commencement of the Offer:     September 13, 2022                           
 Early Participation Deadline:  September 26, 2022 at 5:00 p.m. London time  
 Early Results Announcement:    On or about September 27, 2022               
 Early Settlement Date:         On or about September 28, 2022               
 Expiration Deadline:           October 11, 2022 at 5:00 p.m. London time    
 Final Announcement Date:       On or about October 12, 2022                 
 Final Settlement Date          On or about October 13, 2022                 

Noteholders are advised to check with any bank, securities broker or other
Intermediary through which they hold Notes when such Intermediary would
require the receipt of instructions from a Noteholder in order for that
Noteholder to be able to participate in, or (in the limited circumstances in
which revocation is permitted) revoke their instruction to participate in, the
Offer before the deadlines specified above. The deadlines set by any such
Intermediary and each Clearing System for the submission of Tender
Instructions will be earlier than the relevant deadlines specified above.

The Offeror has the right to extend, amend or terminate the Offer at any time
before the Expiration Deadline.

The Offer is being made solely by means of the Tender Offer Memorandum, dated
September 13, 2022, which sets forth the complete terms of the Offer.
Noteholders are advised to read the Tender Offer Memorandum carefully and in
full for details of, and information on the procedures for participating in,
the Offer.

Noteholders whose notes are held on their behalf by a broker, dealer,
commercial bank, custodian, trust company or accountholder must contact and
request such broker, dealer, commercial bank, custodian, trust company or
accountholder if they wish to participate in the Offer.

NONE OF THE OFFEROR OR ITS AFFILIATES, THE TRUSTEE OR THE INFORMATION AND
TENDER AGENT MAKES ANY RECOMMENDATION AS TO WHETHER OR NOT NOTEHOLDERS SHOULD
TENDER THEIR NOTES. EACH NOTEHOLDER MUST MAKE HIS, HER OR ITS OWN DECISION AS
TO WHETHER TO TENDER NOTES. NOTEHOLDERS ARE URGED TO EVALUATE CAREFULLY ALL OF
THE INFORMATION IN THE TENDER OFFER MEMORANDUM AND TO CONSULT THEIR INVESTMENT
AND TAX ADVISORS IN MAKING THEIR DECISION AS TO WHETHER TO TENDER THEIR NOTES.

Absa Bank Limited and Merrill Lynch International are acting as Dealer
Managers for the Offer (the “Dealer Managers”).

The Offeror is a wholly-owned subsidiary of Petra Diamonds Limited
(“PDL”). PDL's shares are listed on the premium listing segment of the
Official List maintained by the Financial Conduct Authority (the “FCA”)
and traded on the London Stock Exchange's main market for listed securities.
Accordingly, PDL is subject to and must comply with the Listing Rules (as
defined in the Tender Offer Memorandum). The Listing Rules regulate
transactions that constitute Related Party Transactions (as defined in Chapter
11 of the Listing Rules), which can include a transaction between the Offeror,
being a subsidiary of PDL, and a Substantial Shareholder (as defined in the
Tender Offer Memorandum) of PDL. The Offeror makes no offer to Noteholders to
the extent the purchase by the Offeror of Notes (or a certain portion of
Notes) from a Noteholder would be a transaction to which Chapter 11 of the
Listing Rules would apply. Accordingly, the Offer is restricted by the RPT
Condition (as defined in the Tender Offer Memorandum) and the RPT Condition
must be satisfied (or waived) in order for a Noteholder’s Notes to be
validly tendered. The Offeror reserves the right, in its sole and absolute
discretion, to refuse any Notes tendered by Noteholders in the event the
purchase of those Notes by the Offeror would constitute a transaction to which
Chapter 11 of the Listing Rules would apply.

Any questions and requests for assistance concerning the terms of the Offer
may be directed to the Dealer Managers at the telephone number and location
listed below:

Absa Bank Limited
15 Alice Lane
Sandton
Johannesburg 2196
South Africa

Telephone: +44 203 961 6067, +44 738 411 8926
Attention: Simon Rankin
Email: Simon.Rankin@absa.africa

Merrill Lynch International
2 King Edward Street
London EC1A 1HQ
United Kingdom

United Kingdom Telephone (Europe): +44 207 996 5420
Telephone (U.S. Toll Free): +1 (888) 292-0070
Telephone (U.S.): +1 (980) 388-3646
Attention: Liability Management Group
Email: DG.LM-EMEA@bofa.com

Any questions and requests for additional copies of the Tender Offer
Memorandum may be directed to the Information and Tender Agent at the
telephone number and location listed below:

Kroll Issuer Services Limited

The Shard

32 London Bridge Street

London SE1 9SG

United Kingdom

Telephone: +44 20 7704 0880
Attention: Thomas Choquet
Email: petradiamonds@is.kroll.com
Offer Website: https://deals.is.kroll.com/petradiamonds

Forward-Looking Statements

This announcement contains certain forward-looking statements, which are based
on current intentions, beliefs, assumptions and estimates by the management of
the Offeror concerning, among other things, results of operations, financial
condition, liquidity, prospects, growth, strategies of PDL and its
subsidiaries (the "Group") and the industries in which the Group operates. By
their nature, forward-looking statements involve risks and uncertainties
because they relate to events and depend on circumstances that may or may not
occur in the future. Readers are cautioned that forward-looking statements are
not guarantees of future performance and that the Group’s actual results of
operations, financial condition and liquidity, and the development of the
industries in which it operates, may differ materially from those made in or
suggested by the forward-looking statements contained in this announcement. In
addition, even if the Group’s or its affiliates’ results of operations,
financial condition and liquidity and the development of the industries in
which it operates are consistent with the forward-looking statements contained
in this announcement, those results or developments may not be indicative of
results or developments in subsequent periods. The Offeror undertakes no
obligation to update these forward-looking statements and will not publicly
release any revisions that may be made to these forward-looking statements
which may result from events or circumstances arising after the date of this
announcement.

This announcement includes inside information as defined in Article 7 of the
Market Abuse Regulation No. 596/2014 and is being released on behalf of PDL by
the Company Secretary.

~ Ends ~

For further information, please contact:

Petra Diamonds, London                  Telephone: +44 20
7494 8203

Patrick Pittaway                     
            investorrelations@petradiamonds.com         

Jill Sherratt

Julia Stone

About Petra Diamonds Limited

Petra Diamonds is a leading independent diamond mining group and a supplier of
gem quality rough diamonds to the international market. The Group’s
portfolio incorporates interests in three underground producing mines in South
Africa (Finsch, Cullinan Mine and Koffiefontein) and one open pit mine in
Tanzania (Williamson).

Petra's strategy is to focus on value rather than volume production by
optimising recoveries from its high-quality asset base in order to maximise
their efficiency and profitability. The Group has a significant resource base
of ca. 226.6 million carats, which supports the potential for long-life
operations.

Petra strives to conduct all operations according to the highest ethical
standards and only operates in countries which are members of the Kimberley
Process. The Group aims to generate tangible value for each of its
stakeholders, thereby contributing to the socio-economic development of its
host countries and supporting long-term sustainable operations to the benefit
of its employees, partners and communities.

Petra is quoted with a premium listing on the Main Market of the London Stock
Exchange under the ticker 'PDL'. The Group’s US$336.7 million notes due in
2026 are listed on the Irish Stock Exchange and admitted to trading on the
Global Exchange Market. For more information, visit www.petradiamonds.com.



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