File photo: African News Agency (ANA)

JOHANNESBURG  - Mining company Sibanye-Stillwater said on Wednesday it had entered into an acquisition agreement with Generation Mining Limited to further the development of the platinum group metals (PGM)-copper Marathon project in northern Ontario in Canada.

The Marathon project was acquired by Sibanye-Stillwater as part of the Stillwater acquisition in May 2017.

Under the deal, Sibanye-Stillwater will receive upfront proceeds in the form of CA$ 3 million in cash and 11,053,795 shares in Gen Mining, an equity interest of 12.9 percent.

Gen Mining will acquire a 51 percent interest in the project and form an unincorporated joint venture with Stillwater Canada Inc.

The agreement will enable Gen Mining, a base metal exploration and development company with various property interests throughout Canada, to advance Marathon and conclude further economic studies in the development of the asset.

The conclusion of the transaction is subject to customary conditions and is expected before mid July.

Sibanye-Stillwater CEO Neal Froneman said the deal would unlock immediate value for the group and ensure appropriate investment and focus on the Marathon project, whilst maintaining attention on core US PGM operations. 

"We look forward to working with Gen Mining to realize the potential of the property, increasing the value proposition for all stakeholders," he said.

- African News Agency (ANA)