Johannesburg - Northam Platinum, the operator of the world’s deepest platinum mine, will raise R1-billion ($100-million) from selling shares and bank loans as it seeks to offset strike action and repair equipment.
Northam will raise R600-million through a so-called claw-back offer, fully subscribed by Coronation Asset Management (Pty) Ltd, in which 15 million shares will be sold at R40 each, the Johannesburg-based company said on Friday in a statement. Banks will make R400-million available from a new revolving credit facility that ends on March 31, 2015.
“Challenging economic and operational conditions have beset the South African mining industry for an extended period of time, with depressed platinum group metal basket prices, volatile exchange rates, rising costs and a complex industrial relations environment,” the company said in the statement.
Northam lost 192 million rand of revenue in April after workers at its Zondereinde mine went on strike for three weeks resulting in reduced production. The funds raised will also be used to rebuild a smelter, ensure completion of the Booysendal mine and maintain equipment at its Zondereinde facility, it said in the statement.
The company, which posted a 70 percent rise in annual profit last month, said it has fully drawn down its current R1-billion revolving credit facility.
The stock rose 3.9 percent to R42.65 in Johannesburg trading on Thursday, giving a market value of R16.3-billion. The shares are up 12.2 percent this year. - Bloomberg