Impala Platinum (Implats) has finally achieved control of Royal Bafokeng Platinum (RBPlat) after a long drawn-out process and takeover battle after it acquired the Public Investment Corporation’s (PIC) 9.26% shareholding in the platinum group metals (PGM) company.
This move would make Implats hold RBPlat shares comprising an aggregate of approximately 55.46% of the RBPlat shares in issue.
“Implats will control the majority of the issued shares in RBPlat, and RBPlat will become a subsidiary of Implats,” the group said.
Implats CEO Nico Muller said securing control of RBPlat solidified a stronger, more sustainable future for the Rustenburg region, the North West province, and the South PGM sector – collectively a major employer in the mining sector and a key driver of economic activity for the country.
“It will contribute to job security for more than 42 000 Impala Rustenburg employees and contractors, and stability for the more than 495 000 people who depend on its mining activities and social contributions. With more years of continuous operation at scale, the intensity of benefits will continue for longer, delivering tangible socio-economic benefits for the region and its communities,” he said.
Muller said together with commitments related to community development spend, small, medium and micro enterprises support, increased localisation, and supplier support, Implats would facilitate the introduction of broad-based black economic empowerment structures in the ownership of the Implats and RBPlat operations, increasing economic participation and ownership of key assets in the South African PGM sector.
Implats has also extended the closing date of its offer to June 28.
Part of the conditions for the takeover is a new empowerment structure for the merged companies, such as the creation of a community share ownership trust across both companies, as well as the option to replace the RBPlat employee share ownership plan.
In addition, Implats has partnered with Siyanda Resources Proprietary, which will lead a broad-based empowerment consortium (Siyanda Consortium) as part of the proposed empowerment transaction.
The PIC said the Implats offer would deliver financial value to its clients and would ensure long-term sustainability to PGM mining in the greater Rustenburg region.
“It will also have a positive impact on regional employment as well as enable Implats to deliver on its social commitments,” it said.
The drawn-out process for Implats to finally take over RBPlat took more than a year as Northam, a PGM producer, was involved in a takeover bid with Implats over RBPlat.
Owing to the process taking long, RBPlat CEO Steve Phiri said in March that the uncertainty caused by the delay in finalising the corporate action had become a key risk to managing its people, their morale, and retention.
Northam said the reason for the delay was that Implats had submitted various complaints to the Takeover Regulation Panel (TRP) regarding its announcement of the takeover bid. As a consequence of the Implats complaints, the TRP withheld its approval of the posting of the Northam Offer circular until the TRP had decided in respect of the Implats complaints.
Eventually in April, Northam terminated its offer to buy RBPlat, citing low prices of PGM.
As a result, Implats became the only company in the running to take over RBPlats.
Anchor Capital investment analyst Seleho Tsatsi said Implats’ takeover of RBPlats had been expected following Northam Platinum’s decision to terminate its RBPlats offer.
“That decision made Implats the most likely party to gain control of RBPlats. At the moment, the PGM sector is facing the challenge of weak PGM prices, particularly palladium, and rhodium, meaningful cost inflation, and volume pressures.
“Clearly, Impala is looking through the current weakness and is likely thinking about longer-term prices. Impala has finally achieved control of RBPlats after what turned out to be a long drawn-out process,” he said.
By 4.20pm RBPlats’s share were 0.74% higher at R136, while Implats shares were 2.17% higher at R158.33.
BUSINESS REPORT