RBPlat raising funds to acquire Maseve mine
ROYAL Bafokeng Platinum (RBPlat) plans to raise R1.4 billion in its bid to acquire the loss-making Maseve mine, a subsidiary of Toronto listed Platinum Group Metals, which includes a concentrator plant.
The $74 million (R956.7m) transaction is payable through a $62m cash payment and $12m in RBPlat common shares.
RBPlat said yesterday that the transaction provided it with immediate access to an operational concentrator plant to treat ore in respect of Styldrift I and the strategic flexibility to potentially extend the life of the South Shaft Merensky operations.
“This may accelerate the date on which Styldrift I ore can be treated, while reducing both the capital outlays and the technical risk associated with the construction of a new plant,” RBPlat said, adding that the transaction provided it with early access to its Frischgewaagd ore body at Styldrift.
Platinum Group Metals, which owns 82.9 percent of Maseve, said the cash proceeds of the sale would be used to repay debt.
The company estimates ministerial consent may be obtained during 2018.
It said that RBPlat would be granted a management contract for the Maseve mine and for carrying out care and maintenance services during the period between the date of grant of the competition approval and the date of ministerial consent.
The company planned to focus on its large-scale Waterberg project, a palladium dominant development asset where the majority of the company’s mineral reserves and resources are located.
Platinum Group Metals president and chief executive Michael Jones said the company believed it had settled upon terms which would benefit both companies and all stakeholders.
At July 31, the net asset value of Maseve was R3.63bn and for the 12 months then ended, Maseve incurred an operating loss of R6.23m.
Platinum Group Metals currently holds 82.9 percent of the ordinary shares in Maseve.