JOHANNESBURG (miningweekly.com) – Aim- and JSE-listed Jubilee Platinum has agreed to sell its Jubilee Smelting and Refining (JSR) subsidiary, as well as its 70% shareholding in Power Alt, to Global Renewal Energy (GRE) for $14-million.
The transaction, which took effect on May 27, would be executed in two tranches.
Firstly, Jubilee would sell 65% of the issued share capital of JSR and 40% of its overall interest in Power Alt to GRE for a combined $9.07-million in cash.
GRE had to pay a nonrefundable deposit of $200 000 to Jubilee on or before May 27, which would be forfeited should GRE not proceed with the deal.
The balance of $8.87-million would have to be paid in full to Jubilee on or before June 14.
The second tranche of the transaction entailed a put option, in terms of which Jubilee could, at its choosing, over a period of two years, dispose of the remaining 35% shareholding in JSR and its remaining 30% shareholding in Power Alt for $4.93-million in cash.
Further, Jubilee would retain the use of the new 5 MW arc furnace in Middelburg, Mpumalanga, and had the right, for a period of two years, to install an additional 5 MW arc furnace at the smelter.
In addition, it had the right to participate in any expansion of Power Alt’s power plant over the next two years.
Jubilee CEO Leon Coetzer commented that the company had been successful in bringing to value its shareholding in the noncore ferroalloy smelting business and the associated power plant, which would enable it to direct the proceeds from the disposal of the noncore ferroalloy smelters into the continued development of the company’s platinum mine-to-metals strategy.
“Our immediate focus is to expedite the recovery of platinum from the Dilokong chrome mine tailings, while we target further such surface material opportunities. The proceeds from the disposal enables Jubilee to further capitalise on platinum opportunities presented to the company due to current challenges within the platinum industry.
“Our platinum mine-to-metals strategy remains on course with the added benefit of an enhanced cash balance. The extension in the funding condition precedent allows Jubilee to review the updated business model for the PhokaThaba mine, in line with the proposed toll processing of third-party platinum-reef material, as announced on May 23, before committing to final funding terms,” he stated.