JOHANNESBURG (miningweekly.com) – The bid by Impala Platinum Holdings Limited (Implats) for a majority shareholding in Royal Bafokeng Platinum (RBPlat) presents an opportunity to create a sizeable Western Limb production base with socioeconomic benefits for the region, platinum group metals (PGMs) mining company Implats said on Monday.
The proposed transaction opens the way for capitalising on significant synergies as a result of the contiguous nature of the Impala Rustenburg mine and RBPlat’s operating assets, Implats stated in a release to Mining Weekly.
The tangible socioeconomic benefits for communities would include employment security and sustained benefits for the various industries and stakeholders that the mining activities of the greater Rustenburg region support. (Also watch attached Creamer Media video.)
Implats’ announcement of an offer to acquire, in cash and shares, a majority of RBPlats follows Royal Bafokeng Holdings earlier this month accepting R8.6-billion in cash and 8.7% of the shares of Northam Platinum in a transaction that gives Northam 32.8% of RBPlat and opens the way for the Bafokeng community to accelerate into the fast-growing green energy economy with Northam’s help.
The Implats offer amounts to R150 per RBPlat share and comprises a cash amount of R90 (60% of the offer consideration) and 0.30 ordinary shares in Implats (the value of which equates to R60 at the 3-day volume weighted average price of Implats at the close of business on November 24).
It represents a premium of 80% to RBPlat's 30-day volume weighted average price of R83.51 prior to RBPlat and Implats’ joint cautionary announcement on October 27.
Implats currently owns 24.5% of the RBPlat shares in issue, which were acquired on identical terms from existing RBPlat shareholders.
“The overwhelming response and support of these shareholders is particularly validating of our confidence in the value proposition this offer provides for both RBPlat and Implats shareholders,” said Implats CEO Nico Muller.
RBPlat, headed by CEO Steve Phiri, is a mid-sized PGMs producer with mining and concentrating operations contiguous to Implats’ Impala Rustenburg portfolio on the Western Limb of the Bushveld Igneous Complex in South Africa. The size and quality of its mineral reserve has been highlighted, along with a mechanised, Merensky-rich orebody, which Implats views as being aligned with future demand for platinum, nickel and copper.
Implats views the offer as providing a compelling value proposition for RBPlat shareholders “by crystallising inherent equity value at an attractive premium, through the receipt of a combination of cash and high quality, liquid Implats scrip”.
It offers shareholders exposure to a global PGMs portfolio, comprising operating assets, projects and a toll refining business, which is positioned to capture the benefits of the full PGMs value chain through integrated processing facilities, including wholly-owned smelters, as well as base and precious metal refineries.
RBPlat shareholders, Implats added, would also be in line to benefit from a dividend yield underpinned by disciplined capital allocation priorities and a strong balance sheet.
Implats stated in the release that the transaction would:
- increase exposure to low-cost, shallow, mechanised assets, and competitive operations through the cycle;
- enhance further growth through scaled deployment of the mineral resource base and technical capabilities; and
- through broader collaboration, the logical combination of complementary assets and shared infrastructure enable the pursuit of substantial regional growth in the fullness of time.
RBPlat confirmed Implats' offer to acquire all the shares not already held by it and that PSG Capital had been appointed as the independent expert to issue a report on the Implats offer.
To facilitate the offer, RBPlat has entered into a cooperation agreement with Implats, the company stated in a Stock Exchange News Service announcement.