• considered prevailing economic and market conditions in the industry in which Gold Reef operates;• considered the pro forma financial effects of the transactions as detailed in the <strong>circular</strong>.We have satisfied ourselves as <strong>to</strong> the appropriateness and reasonableness of the information andassumptions underlying the valuations performed by:• considering the his<strong>to</strong>rical trends of such information and assumptions;• where practicable, comparing and corroborating such information and assumptions, as we consideredappropriate, with external sources of information; and• discussing such information and assumptions with the management of Gold Reef.VALUATION APPROACHIn formulating our opinion as <strong>to</strong> the fairness of the Proposed Share Exchange, we performed a valuation ofthe shares being acquired by Gold Reef and a valuation of the shares of Gold Reef itself. This was <strong>to</strong>determine the fair value of the assets being acquired relative <strong>to</strong> the fair value of the consideration provided.We also assessed the relative position of Gold Reef before and after the Proposed Share Exchangetransaction.The valuation methodology employed was the discounted cash flow model.Key value drivers for our valuation workings were forecast revenue and expenditure growth rates, capitalexpenditure requirements, growth rate in perpetuity from the end of the forecast period, economic growthrates for the industry, risk discount rates and interest rates. Sensitivity analyses were conducted, wherepracticable, by adjusting key value drivers within probable ranges of expected values.SCOPEWhere practicable, we have corroborated the reasonableness of the information provided <strong>to</strong> us for thepurpose of our opinion, including publicly available information, whether in writing or obtained in discussionswith the management and direc<strong>to</strong>rs of Gold Reef, by comparing information and assumptions <strong>to</strong> his<strong>to</strong>ricalevents and results, as well as external sources of information.Forecasts relating <strong>to</strong> future events are based on assumptions, which may not remain valid for the whole ofthe relevant period. Consequently, forecast information cannot be relied upon <strong>to</strong> the same extent as thatderived from audited financial statements for completed accounting periods. We express no opinion as <strong>to</strong>how closely actual results will correspond <strong>to</strong> projections made by the management of Gold Reef andprovided <strong>to</strong> us during the course of our review.While our work has involved an analysis of the financial information, as provided <strong>to</strong> us, our procedures andenquiries do not constitute an audit or a review in terms of International Standards on Auditing. Accordingly,we cannot express any opinion on the financial data or other information used in arriving at our opinion. Wehave not and we do not assume responsibility or liability for such information.Our opinion is based on current economic, market and regula<strong>to</strong>ry conditions and only upon theabovementioned information made available <strong>to</strong> us. It should be unders<strong>to</strong>od that subsequent developmentsmay affect this opinion, which we are under no obligation <strong>to</strong> update, revise or re-affirm.OPINIONBased on and only subject <strong>to</strong> the aforegoing, it is our opinion that the terms and conditions of the ProposedShare Exchange are fair <strong>to</strong> the independent <strong>shareholders</strong> of shares in Gold Reef. Based on theabovementioned qualitative fac<strong>to</strong>rs, it is our opinion that the terms of the Proposed Share Exchange arereasonable <strong>to</strong> the holders of shares in Gold Reef. It is also our opinion that the terms of the acquisitions ofshares in each of Akani Egoli, Silverstar and ALICM viewed as part of the Proposed Share Exchange are bothfair and reasonable <strong>to</strong> the independent <strong>shareholders</strong> of Gold ReefAn individual shareholder’s decision as <strong>to</strong> whether or not <strong>to</strong> vote in favour of the transaction may beinfluenced by his particular circumstances. This independent opinion does not purport <strong>to</strong> cater for eachshareholder’s circumstances and risk profile, but rather <strong>to</strong> the general body of <strong>shareholders</strong> taken as a whole.Should any Gold Reef shareholder have any doubt as <strong>to</strong> what action <strong>to</strong> take, he should consult anindependent advisor as <strong>to</strong> the merits of the transaction considering his personal circumstances.36
INDEPENDENCEIn terms of Schedule 5 of the Listings Requirements of the JSE, we advise that we have no material interestin the transaction or in the success or failure thereof and that our fees are not contingent upon the successor failure thereof.CONSENTWe hereby consent <strong>to</strong> the inclusion of this letter and references there<strong>to</strong>, in the form and context in whichthey appear, in the <strong>circular</strong> <strong>to</strong> Gold Reef <strong>shareholders</strong>, <strong>to</strong> be issued on or about 10 April 2007.Yours faithfullyMERCHANT SPONSORS (PROPRIETARY) LIMITEDGRANT THORNTON2nd Floor, North Wing137 Daisy StreetHyde Park Shopping Centre,Corner Grays<strong>to</strong>n DriveJan Smuts Avenue Sandown, 2196Sand<strong>to</strong>n, 219637
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