JOHANNESBURG - Anglo American Platinum (Amplats) and the Public Investment Corporation (PIC) yesterday moved to revive the ailing platinum industry, investing a combined $200 million (R2.64 billion) in funds managed by AP Ventures.
Amplats said that the development of a market for platinum group metals (PGMs) was a strategic priority to reignite demand for precious metals.
The group said the funds would be invested globally in companies that supported the development and competitive technological uses of PGMs.
Amplats said the funds would be invested through its wholly-owned subsidiary Anglo Platinum Marketing Limited (APML).
It said a part of the funds would hold certain of APML’s existing investments which have been made under APML’s PGM investment programme while the second would be used to make new investments.
Amplats chief executive Chris Griffith said the launch of AP Ventures was an exciting new development which would support the growth of PGM technologies and increase PGM demand.
“Developing the market for PGMs is a strategic priority for Amplats and this investment with AP Ventures is a key initiative,” Griffith said.
“Having enjoyed success and built a strong track record as part of Anglo American Platinum’s PGM investment programme we have taken the decision to separate the fund’s activities into an independent structure that will attract additional outside investment and allow AP Ventures to increase the scale of its activities.”
PIC chief executive Daniel Matjila said the corporation wanted to strengthen technology innovation and further demand for PGMs.
“As a leading global institutional investor, this investment further demonstrates our support of the UN Sustainable Development Goals. My view is that this investment will stimulate and sustain the demand for PGMs in the long term, benefiting our clients and preserving the long term mineral wealth for all South Africans,” Matjila said.
The PIC is one of Africa’s largest investment managers, with assets totalling more than R2 trillion, and through its extensive investment research expertise brings unrivalled insight to AP Ventures and its portfolio companies.
PIC, as one of the largest investors in the SA PGM mining sector, on behalf of its clients, recognises the need to support its investment in this struggling sector through pro-actively preserving long term mineral wealth for all South Africans.
Wayne McCurrie, a senior portfolio manager at Ashburton Investments, said any initiative to try to stimulate or create new demand for PGMs would be a welcome relief for the industry that had been forced into a tailspin by dwindling demand for commodities in China.
“Currently the PGM price basket is well below the cost of production for most producers, with the notable exception of Amplats,” McCurrie said.