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Pine Pienaar, CEO, Mvelaphanda Resources
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Mvela to tackle Northam call option
David McKay
Posted: Mon, 14 Aug 2006

[miningmx.com] -- MVELAPHANDA RESOURCES (Mvela Resources) has promised to “deal” with a public statement made by Anglo Platinum last month that it owned a call option over Mvela’s 22,5% stake in Northam Platinum.

“I’ll address that at our year-end results announcement,” says Pine Pienaar, CEO of Mvela Resources. Mvela is scheduled to report its figures on 24 August.

Anglo Platinum said in notes to its interim results, published on 31 July, that it held a call option over Mvela’s stake in Northam. Mvela’s stake in Northam was conditional upon Mvela achieving “certain empowerment thresholds” on or before 30 July 2007, it said.
I’ll address that at our year-end results
Anglo Platinum, Mvela Resources and Northam are negotiating the sale of Mvela's 50% stake in the undeveloped Booysendal platinum project to Northam. In return Mvela's stake in Northam will be increased to 34% from 22.3% currently. The talks have dragged on for years, mainly because of Anglo Platinum's concerns about Mvela's empowerment status.

Interestingly, Anglo Platinum says the call option is exercisable at R8,60/share, representing a massive discount to Northam’s current value of R39/share. Anglo Platinum also pointedly remarks that the call option has been renewed on two previous occasions.

Mvela’s empowerment credentials have frequently been up for examination, having issued shares to help finance a stake in Gold Fields. However, Pienaar is now expected to press home its much-improved empowerment status of Mvela Resources following a restructuring last month of Mvelaphanda Holdings’ interest in the mining firm.

In terms of that deal, Mvelaphanda Holdings has taken a direct 30% in Mvela Resources. The deal is expected to open up fresh deal flow for the company, which has been lacking lately.

Pienaar declined to comment further on the situation concerning Anglo Platinum.
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But it’s thought that the Anglo American subsidiary is incorrectly claiming the rights to buy back the 5% stake in Northam that Remgro sold to Mvela Resources.

That dates back to the original transaction in 2000, in which Anglo Platinum sold 17,5% in Northam to Mvela Resources, while Remgro contributed another 5% in the platinum miner.

As an interesting sidebar, one wonders whether Anglo Platinum is claiming the entire transaction with Mvela Resources in its application for new order mining rights from SA’s Minerals & Energy Department.