SIBANYE-Stillwater said on Friday it will pay €65 million (R1.12 billion) for a smelting facility from French mining and metallurgy company Eramet SA as it advances its battery metals strategy.
The acquisition is the second step of Sibanye’s battery metals strategy and comes five months after an investment into a Finnish-based lithium company.
Sibanye, the precious metal giant, said it would pay cash for the acquisition of a 100 percent stake in Eramet’s Sandouville nickel hydrometallurgical processing facility through an exclusive put option agreement.
Chief executive Neal Froneman said the transaction was an important step in getting further downstream exposure to the battery metals value chain.
“The Sandouville facility is ideally located close to the European end-user markets and well supported by significant logistical infrastructure, which will allow us to leverage our existing Platinum Group Metals relationships. We look forward to working with Eramet and the French authorities to build a leading battery metals platform in Europe,” Froneman said.
Sibanye said the transaction was expected to conclude by year end, subject to regulatory approvals including the approval of the South African Reserve Bank.
Eramet said should the transaction succeed, Sibanye-Stillwater planned to continue the turnaround and develop new activities on site.
Eramet chairman and chief executive Christel Bories said the agreement was an opportunity for the Sandouville site and for the group.
“Subject to its completion, the transaction would unlock a sustainable future for the site and new prospects to the benefit of the employees and the Normandy region, and would enable Eramet to focus on its core strategic projects,” said Bories.
The Sandouville facility is situated at Le Havre, France’s second largest industrial port, with strategic access to extensive logistical infrastructure including shipping, rail and key motorways, supporting any future supply into the European end-user markets, Sibanye said.
The site employs around 190 people, specialises in the manufacturing of high value-added nickel salts and high-purity metal for specific applications in electroplating, catalysis, super-alloys and electronics materials.
Sibanye said Sandouville’s facilities include a hydrometallurgical nickel refinery with a production capacity of 12 000 tons a year of high-purity nickel metal, 4 000 tons per annum of high-purity nickel salts and solutions and around 600 tons per annum of cobalt chloride
Sibanye has bolstered its battery strategy as the increasing adoption of electric vehicles has accelerated the demand for lithium, nickel and cobalt.
In February Sibanye announced the 30 percent acquisition in Finnish based lithium firm Keliber Oy, which is developing the Keliber project, a 9.3 million tonne reserve lithium project located in the Kaustinen region of Finland.
The Keliber project is anticipated to come into production in 2024. Lithium is viewed as one of the core metals to benefit from the significant growth forecast for the electric vehicle sector. Sibanye believed its investment in Keliber represented a strategic partnership of complementary skills.
Sibanye’s share price fell 1.13 percent on Friday to R63.79.
BUSINESS REPORT ONLINE