Platinum firm debuts
BILLIONAIRE Northam Platinum chairman Lazarus Zim says expansion plans are in the pipeline for the world’s third-biggest platinum producer. Zim was speaking yesterday during Zambezi Platinum’s debut on the JSE. After the listing, Northam stock rose 1.28 percent to close at R47.64 on the JSE. “We are very bullish about the growth prospects of the company. We have a strong balance sheet and we are in a position to make value acquisitions,” Zim said. Zambezi, owned by black investors, listed its preference share at R41 a share under the ticker ZPLP.
BILLIONAIRE Northam Platinum chairman Lazarus Zim says expansion plans are in the pipeline for the world’s thirdbiggest platinum producer.
Zim was speaking yesterday during Zambezi Platinum’s debut on the JSE.
Zambezi, owned by black investors, listed its preference share at R41 a share under the ticker ZPLP. After the listing, Northam stock rose 0.79 percent on the JSE, before closing 1.28 percent higher at R47.64.
“We are very bullish about the growth prospects of the company. We have a strong balance sheet and we are in a position to make value acquisitions,” Zim said.
Zambezi has paid R4.6 billion as part of a deal to acquire 31.4 percent of Northam’s ordinary share capital. The firm described the transaction, which was expected to benefit employees and communities, as a boost for empowerment.
Northam’s empowerment transaction stake is a lot higher than the industry average and government requirement of 26 percent.
“We know that platinum sentiment is subdued at the moment, and we are confident that as the world economy rebounds there will be growth in the mining industry,” Zim said yesterday.
Zim is Zambezi’s chairmanelect and is a former chief executive of Anglo American’s South African unit, a former chairman of Kumba Iron Ore and Telkom, and a past president of the Chamber of Mines.
His Afripalm Resources helped to facilitate Northam’s acquisition of the Booysendal property in 2007, where the company has since built a new mine, which is operational.
Northam sought to fund its black economic transaction by not using bank funding but rather shareholder funding.
“We have a rights issue, and we are in a process of raising R4bn, which will finance the empowerment scheme. We will have ten years to repay the money,” Zim said in an interview on CNBC yesterday.
Paul Dunne, Northam’s chief executive, said at Zambezi’s debut: “Northam’s strategy is to grow the business and we are targeting shallow mechanisable ore bodies in our neighbourhood.” The firm plans to cut costs and lower its risk profile.
Northam said in February that it would buy Aquarius Platinum’s Everest mine for R450 million.
Dunne said Northam was positioning itself for a turnaround in the platinum prices, which the firm forecast would happen in the next few years.
Peter Major, an analyst with Cadiz Corporate Solutions, said he was wary about the debt Zambezi would accumulate.