www.miningmx.com | dgc Aquarius downplays Impala buyout talk

Stuart Murray, Aquarius CEO

» Aquarius Pt styled SA’s “King Rat”
» 'More to go on the upside' - Stuart Murray, AQP
» Aquarius pledges earnings harvest
» Aquarius Pt may land Anglo deals

Aquarius downplays Impala buyout talk
David McKay
Posted: Wed, 28 Sep 2005

[miningmx.com] -- AQUARIUS Platinum acknowledged Impala Platinum had probably “stacked us up against other opportunities” in response to speculation that the world’s second largest platinum producer was assessing a buy-out of the 380,000 oz/year junior.

Impala Platinum owns about 8% of Aquarius Platinum, but has been linked with a buyout of the firm it helped create about six years ago.

“Our register is wide open and sure, if they [Impala] made a sensible proposal, we’d be duty-bound to consider it,” said Stuart Murray, CEO of Aquarius Platinum. “Impala plays footsie-footsie with us every year. They are probably stacking us against their other growth opportunities,” he said.

Aquarius Platinum is an interesting proposition to most platinum juniors. The firm has strong management and crystal clear strategic direction.

Impala plays footsie-footsie with us every year.

Commenting on the company’s future at the Denver Gold Forum, Murray said: “We’re not going to squander what we’ve got. We won’t be going exploring; we won’t leave the continent; and we won’t be changing metals”.

In August, Aquarius Platinum declared a one third increase in its total dividend of 8c/share on the back of record production. The company was also on course for attributable output of nearly 700,000 oz/year of platinum by 2007 as part of a strategy aimed at harvesting years of development.

Interestingly, total metal ‘under management’ was 1 million oz/year built in “six to seven short years”, Murray said. Impala Platinum produces about 1.1 million oz/year.

As such, Aquarius offers a low risk growth option for Impala which is struggling to turn its large Zimbabwean resources to account in the short to medium term.

Keith Rumble, Impala Platinum CEO, said however that while Aquarius was an interesting company, its growth promise was “reasonable but not substantial”. He also believed there were less reasons to absorb Aquarius than generally recognised.

“We already participate in the economic proposition that is Aquarius. In addition, the company is run like Impala – lean and mean – so there aren’t many synergies that could be extracted. And our properties are not contiguous,” said Rumble.

Georges Lequime, an analyst for RBC Capital Markets, said Anglo Platinum’s share and pool agreement with Aquarius Platinum over the Marikana mine also lowered its attractiveness to suitors. “By tying the Aquarius colours to Anglo Platinum, we believe this has reduced the attractiveness for a new entrant to acquire Aquarius,” he said in a recent report.

Free news alerts: click here to subscribe

For his part, Murray said Aquarius was interested in consolidating smaller platinum producers in southern Africa.

“There’s quite a number of bits and pieces in the hands of black economic empowerment companies,” he said. “For platinum mining, you need capital and you need technical expertise, as well as a track-record of operating less expensively,” he said.

“There’s a number of crumbs we’d be interested in having a look at. But if we can’t find a sensible opportunity, we’ll give the money back [to shareholders],” he said.