Northam Platinum: Share plan to raise empowerment stake

NORTHAM Platinum will sell shares under a R6.6 billion plan to raise black South Africans’ stake in the company, the owner of the world’s deepest mine producing the metal, to more than a third. Northam will sell more than 112 million new shares at R41 each to black shareholders for R4.6bn, the Johannesburg-based company said yesterday. Those shareholders will also buy 47.7 million shares from the Public Investment Corporation for R2bn. That will bring the holdings to 35.4 percent. The company would use “the injection of R4bn free cash to fund Northam’s growth”, it said. “The transaction effectively catapults Northam into the ‘1st division’,” Northam said, referring to the largest producers including Anglo American Platinum and Impala Platinum. Local mining companies face a December deadline to raise black South Africans’ holdings to at least 26 percent, a policy aimed at redressing economic disparities created during apartheid. The stake of Northam’s previous main black owners, Afripalm Resources and Mvelaphanda Holdings, was eroded as the companies had to sell part of their stakes to repay loans. Shares declined by 2.79 percent to close at R34.80 yesterday. – Bloomberg