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Amplats sells Union Mine, MASA to Siyanda
Posted on Thursday, 16 February 2017 13:29
Anglo American Platinum (Amplats) is finally unloading its stake in South Africa’s Union Mine after striking a deal with Siyanda Resources while announcing 2016 headline earnings swung to a profit from a 2015 loss.
The platinum giant said it is handing over its 85.0 per cent interest in the asset based Rustenburg district of the Limpopo and North West provinces to Siyanda Resources to bring an end to a four-year restructuring process.
As part of the deal Amplats is also exiting its joint venture MASA Chrome by selling its 50.1 per cent stake in the chromite recovery business located on the Union mine to 49.9 per cent partner Siyanda.
The ZAR 6.40 billion (USD 490.30 million) agreement comprising an initial payment of ZAR 400.00 million in cash and a deferred sum over a period on 10 years and capped at ZAR 6.00 billion.
In return Siyanda will sell concentrate produced by the Union Mine to Amplats for seven years following the effective date of the sale and purchase.
A disposal has been on the cards since January 2013 when the platinum group metals miner announced it would restructure and exit the assets as part of a plan to sell and wind down its older, less-profitable operations.
Over the four years Amplats said it has combined “North and South Mines into a single operation and placing North declines, South declines and the Mortimer Merensky concentrator on care and maintenance”.
The group is planning to use proceeds to repay debt, which stood at ZAR 7.30 billion as at 31st December 2016 (31st December 2015: ZAR 12.80 billion).
During 2015 it managed to continue to reposition its portfolio by signing the divestures of: resources within the Amandelbult mining right to Northam; and its 42.5 per cent stake in the Pandora joint venture to Lonmin.
Headline earnings recovered from a restated loss of ZAR 0.10 billion in FY 2015 to a profit of ZAR 1.90 billion.
© Zephus Ltd