DURBAN - Royal Bafokeng Platinum (RBPlat) told shareholders its $70 million (R841m) acquisition of the concentrator plant and certain surface assets of Maseve Investments from dual- listed Platinum Group Metals has been completed, pending regulatory approval.
RBPlat said on Friday all surface rights for the transaction had been transferred to its name, and that the deal was subject to the Department of Mineral Resources (DMR) granting approval to the transaction, under section 11 of the Mineral and Petroleum Resources Development Act (MPRDA).
RBPlat said in September last year it would issue 37million shares to pay for the transaction for the Maseve mine and other surface infrastructure for $58m, after receiving shareholder approval on November 30, 2017.
However, it had now put the rights issue for the project on ice, owing to the volatile economic environment.
“Having assessed the company’s near-term capital requirements with regards to the plant consideration, related upgrades, as well as the Styldrift ramp-up, and given current market conditions, the board does not believe it is in the best interests of the company to raise equity capital at this time,” it said.
The mid-tier, South Africanfocused platinum producer said it had sufficient liquidity, cash and available debt facilities to settle its obligations, and would reassess its capital needs from time to time as required.
RBPlat acquired Maseve from Canadian-based platinum group metal producer, Platinum Group Metals, and the deal was approved by the competition authorities in January.
The company also said that the other transaction, in which RBPlat agreed to buy 100percent shares in Maseve and other liabilities for $12m, is yet to be concluded. The group said it was awaiting the DMR approval to the transaction under section 11 of the MPRDA.
The approval is expected to be granted in a matter of a few weeks.
When concluded and fully commissioned, the Styldrift project is forecast to double RBPlat’s platinum group metal production to 600000 ounces a year.
In March last year, RBPlat managed to raise R1.2billion through a convertible bond.
However, its share price continues to be under pressure, as it was down by more than 2percent on the JSE on Friday, to R25 a share.
The share price has fallen by almost 30percent compared to a year ago, when it was trading at R35 a share.
The company’s balance sheet has been put under pressure as it spent R2bn in capital expenditure in building the Styldrift I project in the past financial year.