Broad-based Black Economic Empowerment Transaction

broad-based and sustainable

Pretoria Portland Cement Company Limited

Broad-based Black EconomicEmpowerment TransactionPresentation to Investors, Analysts and Media

28 August 2008

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Ntombi Langa-Royds - MC, Non-Executive Director

John Gomersall - PPC, CEO

Community Service Groups Phutumile Dumisa - Shalamuka for Penreach

Mike du Toit - Disability Empowerment Concerns, CEO

Strategic Black Partners Salukazi Dakile-Hlongwane - Nozala, Executive Chairman

Peter Malungani - PEU, Executive Chairman

Mandla Gantsho - iLima Portland Consortium, CEO

Jerry Vilakazi - Capital Edge Cement Consortium, Chairman

Introducing the Team


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John GomersallPPC – Chief Executive Officer

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R2.7bn broad-based black ownership initiative 15.00% shareholding in the increased issued share capital of PPC acquired by

black people Major portion allocated to broad-based empowerment groupings through the

inclusion of PPC employees and their families, communities, construction and related industry associations, education and community service groups

This initiative will directly benefit approximately 3.5m people in South Africa, of which 99.90% are black individuals

Total risk equity capital of approximately R65.4m contributed by empowerment parties

An issue of new shares of 8.50% of PPC’s increased share capital and a Scheme of Arrangement in terms of Section 311 for 6.65% of PPC’s increased share capital

PPC will raise approximately R1.5bn long-term debt to replace existing short-term interest-bearing debt raised to fund its capital expansion projects and working capital requirements

Highlights

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PPC’s approach to Transformation

EmploymentEquity/Job Creation

Black Equity Participation

Develop Black Entrepreneurs

Opportunities for black leaders and employees

Empower and uplift disadvantaged communities

The Poverty Barrier

The Skills Barrier

The Business Barrier

The Opportunity Barrier

Equitable Economic Opportunities

CSI

Skills Development

Preferential Procurement

Enterprise Development

Ownership and Management

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The transaction is structured to embrace the true spirit of broad-based black economic empowerment (BBBEE)

Developed in accordance with Mining Charter and the DTI’s Codes of Good Practice A holistic part of our transformation strategy which is part of PPC’s DNA A significant stride towards meeting our BBBEE objectives and conversion of mineral

rights

This empowerment transaction achieves: Meaningful and sustainable wealth creation and black empowerment Minimal dilution and cost to shareholders while strengthening our BEE credentials Long-term mutual value creation for all stakeholders

BBBEE Transaction overview

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Transaction Structure OverviewBroad-based stakeholders

Total transaction 15.15% - R2.7bn

Broad-based Entities 8.15%

Strategic BlackPartners7.00%

(Including some Broad-based elements)

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Majority of 8.15% to Broad-based Entities 5.2% External stakeholders 2.95% Internal stakeholders

7% to Strategic Black Partners 4 partners in total some including Broad-based elements such as

youth and women

Transaction Structure OverviewBroad-based stakeholders

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Truly broad-basedExternal Trusts and Community Service Groups (CSGs)

Largest allocation to Construction Industry Association Trust Community Trust and CSGs (Shalamuka & DEC)

Internal Trusts Including staff, management and their families Small allocation to a trust for 3 Independent Non-Executive Directors

R1.46bn allocated to Broad-based stakeholders

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R1.46bn allocated to Broad-based stakeholders

Independent Black Non-Executive Directors

0.05%

PPC Team Benefit Trust0.50%

PPC Current and Future Team Trust

0.57%

PPC Black Managers Trust1.83%

Internal Components (2.95%)

CommunityService Groups

1.50%

PPC Education Trust1.00%

PPC Community Trust0.70%

PPC Construction Industry Association Trust

2.00%

External Components (5.20%)

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Detailed structure – slide 39 - in Annexures at back of booklet Reflects effective % shareholdings

Source of shares 6.65% into various Trusts via Section 311 Scheme of Arrangement 8.5% via the issue of new shares

Transaction Structure and Overview

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Share price applicable R31.32 (30 day VWAP at 21 August 2008) Funding

Construction Association and PPC Education, Community, Team Benefit and the Black Managers Trusts - financed through a preference share funding structure

General staff and the black non-executive directors will receive a non-refundable contribution from PPC to purchase shares

New PPC shares to be issued to CSG - funded by a credit sale structure - (CSGs contribute nominal R5.4m in equity)

New PPC shares to be issued to SBP consortium - funded by a credit sale structure (SBP’s contribute R60m in equity)

Vesting and Lock-in Shareholdings have various vesting conditions and sale restriction periods

Dividends General Staff and black non-executive directors will receive dividends immediately Trickle dividend to external trusts, PPC Team Benefit Trust and CSG’s


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Dividends / Earnings dilutionary effect Initial dilution only 5.9% – (new shares issued - 8.5% of increased shares in issue

reduced by 2.6% shares bought back held by PPC Treasury) It is PPC’s intention to buy back shares when appropriate to limit dilution

Balance Sheet PPC will receive approx. R1.5 bn through the CSG PPC and SBP PPC interest

bearing loans PPC intends using these long-term interest bearing loans to replace existing short-

term interest bearing borrowings raised to fund capital expansion projects and working capital requirements

IFRS2 share-based payment charge R557.4m equates to 3.24% of market capitalisation of R17.2bn at close of business

on 21 August 2008



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Phutumile Dumisa

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The Shalamuka Foundation is a trust founded in 2006 to act solely as the funding vehicle for the highly regarded Penreach Whole School Development Programme (“Penreach”)

Penreach has enjoyed 14 successful years of operation, reaching and imparting skills to over 900 schools and 2200 teachers annually, 4,000+ teachers / 3 million learners reached to date. 90% of the teachers are women and 95% are black rural South Africans. Beneficiaries are identifiable by their registration with the programme

Shalamuka is focused on securing long-term sustainability and funding for Penreach The 350,000+ annual learners are mainly in Mpumalanga (rural/ disadvantaged township

schools) and Limpopo (Bushbuckridge and Mkhuhlu areas) also in Swaziland Trustees 85% black South Africans and 71% are black women. All trustees are volunteers

and do not benefit financially, including; Yvonne Chaka Chaka Mhinga; Leah Gcabashe; Phineas Mojapelo; Paul Harris; Elizabeth Maepa and Ethyl Nyembe

Shalamuka has EmpowerDex certification and is compliant with 2007 DTI BEE codes. It enhances CSI/BEE scorecard of investee companies

The Shalamuka Foundation0.75% - R134m

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Founded in 1994 with 40 teachers from 10 schools, Penreach is a non-profit skills development programme supporting qualified and unqualified teachers by providing skills training workshops, support visits to schools by experienced fieldworkers, and tutorial lessons in mathematics and science.

The results are seen in improved teacher status and confidence, productivity and discipline, focused results in maths, science and literacy

The Penreach mission statement is: “To improve the quality and accessibility of education for teachers and learners in disadvantaged schools”

Penreach’s upliftment of local communities via improvement in education has been recognised by numerous awards and is supported by the Department of Education

Penreach principles are currently being applied by, Grace College (KZN), Mitchell House Preparatory School (Polokwane), Thandulwazi Teacher Training Programme (Maths and Science), St. Stithians College (Johannesburg)

The PPC transaction will enable Shalamuka to roll out their programme in a number of other regions and provinces, and schools outreach programmes, based on the Penreach model

Shalamuka –The Penreach Programme


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Mike du Toit

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DEC – The Disability Empowerment Concerns Trust was established in 1996 by seven major South African NGO’s representing 2 million South Africans with disabilities, of whom at least 85% are black people.

DEC investment returns contribute to funding the human rights and development work of:

SA Federation for Mental Health Deaf Federation of South Africa Disabled People South Africa National Council for Persons with Physical Disabilities in SA South African National Council for the Blind Epilepsy South Africa Thabo Mbeki Development Trust for Disabled People

DEC was established to engage in business ventures as a Broad-based Black Economic Empowerment shareholder.

Disability Empowerment Concerns Trust0.75% - R134m

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DEC is governed by a Board of Trustees made up of 14 independent trustees - 9 are black people (64%); 4 are black women (28%).

5 of 8 directors of the DEC Investment Holding Company are black people, 4 are black women, and all are people with disabilities.

Mandate to develop a sizeable diversified portfolio of investments which will over time yield a sustainable income stream without the need for sale.

DEC therefore has a long-term time horizon in evaluating investments DEC seeks that an investment is self funding, but if necessary

supplements funding requirements from its own sources. DEC’s unique value proposition has led to our inclusion in the BEE

transactions of many major South African companies

Disability Empowerment Concerns Trust

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Strategic Black Partners7% in total – R1.25bn

Also including broad-based elements

Peu, 1.90%

Nozala 1.80%

iLima Portland Consortium

1.80%

Capital Edge Consortium

1.50%


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Salukazi Dakile-Hlongwane

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Broad-based women's empowerment group. Established 1996 with 100% black management, 86% Black Shareholding; 34% Broad-based shareholding; 70% Black women owned and indirectly benefitting over 500,000 black women

Mission involves economic advancement of women through constructive business partnerships. Develops and supports rural women entrepreneurs through Nozala Trust

Long-term investor focused on the resources sector, industrial and consumer services. PPC completed its first BEE transaction with Nozala, (50% stake in Afripack) which was

100% vendor financed by PPC as an enterprise development project in 2004 In addition to broader business associations and relationships in SA, the rest of Africa and

globally, Nozala is also able to contribute following: Sourcing contracts for PPC Support management in recruitment efforts for suitably qualified black executives Support effective implementation of PPC’s enterprise development programme Assist in identifying meaningful and sustainable community projects

Nozala1.8% – R322m


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Peter Malungani

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Peu is a black owned and black managed company, established in 1996 with a management shareholding of 72%, the balance (28%) is held by two trusts

Intsika Investment Trust and Intsika Enablement Trust which facilitate BBBEE Peter Malungani is the founder and Executive Chairman of Peu. The management team

comprises of 7 individuals, with a combination of skills in finance and investment banking Prior to the formation of Peu, Peter was owner of a construction business which has built

a long-standing relationship with PPC since 1993 when in partnership we built the first corporate owned shopping centre in Soweto in 1993

Peu holds strategic long term investments predominantly in infrastructure and various sectors

Peu’s sector portfolio includes amongst others DipCivils and Stabilid Peu previously held 50% of Taylor Woodrow SA, which built the Hector Peterson

Memorial complex in Soweto and together with Grinaker, built the Monte Casino complex

Peu will add value by assisting PPC with advice on external trusts and enterprise development

Peu1.9% – R340m


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Mandla Gantsho

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Established to participate in the PPC transaction and expose shareholders to a prime infrastructure development and construction materials investment

Key shareholders are: Controlling shareholders of iLima Group (Pty) Ltd, i.e.

• Dr Mandla Gantsho, a development finance practitioner, currently working for the African Development Bank (formerly CEO of the DBSA)

• Dr Lupepe the Group Chief Executive of iLima Group an entrepreneur and founder • Simisani Kupe the CEO of ILima Mining and Strategic Investments

iLima Group employees Other non-iLima Group Black individuals, youth and women

iLima Group is a long-term investor focused on infrastructure development, minerals exploration and energy generation and distribution

Other significant iLima Group investments are in Group Five Limited, Bombela Concession and Imbumba Aganang Concession (Department of Foreign Affairs Headquarters)

iLima Portland Consortium and PPC will both derive synergies from their strategic alignment along a more integrated infrastructure-related demand and materials-related supply chain linkages

The iLima Portland Consortium 1.8% – R322m


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Jerry Vilakazi

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Capital Edge Cement Consortium is a Broad-based group formed in August 2006 primarily for the purpose of the Strategic Black Partnership with PPC.

Our vision is to be a strategic partner by playing a leading role in BBBEE through participation in initiatives that have the potential to create employment and skills transfer

Diverse - strong women component, youth and shareholder representation in all provinces

Consortium is led by Jerry Vilakazi, (CEO of BUSA and entrepreneur) with key management in Dr. Rejoice Simelane, Chama Kamukwamba and Tiisetso Tsukudu

Shareholders Capital Edge Cement Consortium consist of the following: Capital Edge Resources (Jerry Vilakazi, )

Ubuntu-Botho Investment Holdings (Broad-based groups/individuals) Black Management Forum Investment Co. (Broad-based professionals) Imbewu Mineral Holdings (Tiisetso Tsukudu) Baswa Investments (Youth Groupings) (Malose Kekana) Yard Capital (Leslie Maasdorp) Abafazi iAfrika Group (Fay Mukaddam)

Together with the Black Management Forum (BMF) we are committed to Human Capital development and will further assist PPC in achieving its transformation through access to black skills and talent and proactively identifying new business opportunities in sub-Saharan Africa

Capital Edge Cement Consortium1.5% – R268m


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John GomersallPPC – Chief Executive Officer

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Direct Beneficiary Analysis –Excluding Broad-based elements in Strategic Black Partners

External Trusts 1.1m

CSG’s2.4m

Internal Trusts4 000

Based on Stats SA dependency multiplier of 3 –Could touch over 12 million people?

3.5 million direct beneficiaries

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Broad-based BEE and diverse partnership structure Positively impacts 3.5 million people directly Major stride advancing BBBEE in PPC. Future advances to come Transformation in PPC goes beyond just equity ownership Meets the requirements of the Mining Charter and DTI Codes Mutual long-term benefits for key stakeholders – shareholders, employees,

communities, SBPs, CSGs Sustainable – lowest possible borrowing cost to participants IFRS2 charge at 3.24% of market capitalisation in line with recent BEE

transactions Dilution is minimal

Summary and Conclusion

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Thank you – Any Questions?

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Ntombi Langa-RoydsPPC – Non Executive Director

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Key dates

Circular and notice of general meeting posted to shareholders Thursday, 16 October

General & Scheme meeting of shareholders Tuesday, 11 November

Court hearing to sanction the Scheme Tuesday, 25 November

Effective closing date of transaction on or about Monday, 15 December

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Media are invited to a round table session at the front of the auditorium at 11:30 this morning

PPC executives are available for further explanations

Break for refreshments/finger lunch in the atrium

Thank you once again for attending

Closing Proceedings

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Thank you

www.ppc.co.zaTel. 011 386 9000

http://www.ppc.co.za/

http://www.ppc.co.za/

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ANNEXURES

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Strategic Black Partners CEO BEE Credentials Value – Add

NOZALA(1.8%)R322m

Salukazi Dakile-Hlongwane Black women’s empowerment group est.1996 focused on mining services and construction sectors

Will assist PPC with new business, identification of black executive talent, implementation of community/ enterprise development projects

Peu(1.9%)R340m

Peter Malungani Black owned and managed investment company focused on operations in construction

Will assist PPC with implementation of external trusts and enterprise development projects

iLIMA PORTLAND CONSORTIUM(1.8%)R322m

Mandla Gantsho Extensive interest in construction, power generation and PPP’s

Will assist PPC with International and African continental infrastructural networking and material supply chain linkages

CAPITAL EDGECEMENT CONSORTIUM(1.5%)R268m

Jerry Vilakazi Formed for PPC BEE transaction, includes women, youth and disabled component. It is a Broad-based consortium

Will assist PPC with transformation, new business opportunities in Africa and identification of black executive and management talent

Summary Table SBP’s BEE Credentials

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Transaction Structure (based on 30 day VWAP to

close of business on 21 August 2008 of R31.32 per PPC share)

0.70%

The PPC Team Benefit Trust

The PPC Community Trust

15.15%

0.50%

The PPC Construction Industry Associations

Trust

2.00%

The PPC Team Benefit Trust Funding SPV

The PPC Black Managers Trust

1.83%

The PPC Black Independent Non-Executive Directors Trust

The PPC Construction Industry Associations Trust Funding SPV

The PPC Community Trust

Funding SPV

100%100% 100%

The PPC Education Trust

The PPC Education Trust Funding SPV

1.00%

100%

Other PPC Shareholders

1.50%

0.75%

7.00%

Peu

The SBP Funding SPV

Nozala Capital EdgeiLima

1.90% 1.80% 1.50%1.80% 0.05%

0.57%

The CSG Funding SPVBroa

d-ba

sed

Stra

tegi

c

The Current PPC Team Trust and The Future PPC Team Trust DEC

0.75%

Shalamuka

External trusts Internal trusts

Internal trust

CSGs

SBPs

Percentage holdings all reflect effective holding in PPC post increase in shares issued – reduced by shares held by PPC in treasury

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Trusts Effective % of PPC Shares (millions) Value (R million)

External Components

The PPC Construction Industry Associations Trust 2.00% 11.425 R357.8

The Community Service Groups (Shalamuka & DEC) 1.50% 8.569 R268.4

The PPC Community Trust 0.70% 4.016 R125.8

The PPC Education Trust 1.00% 5.713 R178.9

Internal Trusts

The PPC Black Managers Trust 1.83% 10.470 R327.9

The PPC Team Benefit Trust 0.50% 2.856 R89.5

The Current & Future PPC Team Trust 0.57% 3.225 R101.0

Black Independent Non-Executive Directors 0.05% 0.287 R9.0

TOTALS 8.15% 46.562 R1 458.3

Overview of Broad-based components

Documents

Broad-based Black Economic Empowerment Transaction