Bernard van Rooyen, Mvelaphanda Resources
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» Lazarus Zim may take Mvela Res shares
» Zim zipped on Mvela stake
» Mvela sees way open for Booysendal deal
» Mvela on egg shells over Booysendal
» Plans to develop 100m oz Booysendal revived

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Booysendal deal by early 2007
Allan Seccombe
Posted: Thu, 09 Nov 2006

[miningmx.com] -- THE long-delayed transaction between Anglo Platinum and Mvelaphanda Resources on the Booysendal platinum deposit should be concluded early next year, Mvela deputy chairman Bernard van Rooyen said on Thursday.

The transaction, which has been four years in the making, will see Mvela Resources transfer its 50% stake in the Booysendal joint venture with Anglo Platinum to Northam in exchange for shares, lifting Mvela’s stake in the platinum miner to 34% from 21.9%.

“We are moving to a point where we will resolve it. I can’t guarantee it, but looking at the way things are moving I would hope it will be early in the new year,” van Rooyen told Miningmx.

The deal has been complicated by Anglo Platinum wanting watertight empowerment credentials from the transaction. The world's largest platinum company has come under criticism from the government in the past for not doing enough on empowerment as laid out in new mining legislation.
early in the new year
This might not be the only transaction between empowerment company Mvela Resources and Anglo Platinum.

On 17 October, Miningmx speculated that Mvela Resources could be in a position to buy Anglo Platinum’s 22.5% stake in Northam, using cash from an empowerment transaction involving former Anglo American SA CEO Lazarus Zim.

Mvela Resources, which is 29% owned by Tokyo Sexwale’s empowerment company Mvelaphanda Holdings, could have its black shareholding pushed above 50%, Mvela Resources CEO Pine Pienaar said at the company’s annual results presentation.

Mvela Resources has cautioned shareholders that it is involved in talks that could affect its share price. It has given the market no further details.

If Mvela Resources bought more shares in Northam to raise its holding above 35% it is obliged to extend the offer to remaining shareholders unless those shareholders waive their rights.

“If we want to go beyond 34% we’d have to go to shareholders to ask them to waive their rights to get an equivalent offer. To my knowledge, most Northam shareholders don’t want out because they’ve done very well and they see further growth coming,” van Rooyen said.

“Anglo Platinum is unlikely to be in Northam forever,” he said.

Gaining the majority stake of 56% in Northam will give Mvela Resources operational control of an asset for the first time, moving it away from the label of a holding company.

Northam currently has a single mine, which is heavily potholed and very difficult to mine. The company is deepening what is already the deepest mine on the rich South African platinum deposits to access reef not afflicted with potholes.
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Northam is deepening its mine to 2,200m to access pothole-free reef and it is looking at going down another 65 metres to 15 level, said CEO Glyn Lewis.

The mine is on the northern tip of the Western Limb of the Bushveld Igneous Complex (BIC). Booysendal is near Steelpoort on the Eastern Limb, roughly 250km away as the crow flies.

Booysendal has an estimated 100m oz of platinum group metals and is a shallow deposit that outcrops in parts.

Northam will insist on treating its share of the concentrate at its smelter, which has excess capacity. The 15 megawatt smelter operating at between seven and 10 megawatts and has enough spare capacity, said van Rooyen, who is a non-executive director at Northam.

There are tax incentives that make sense for Booysendal to be in the Northam fold, because it can offset 25% of the capital cost of developing the asset against taxable income from its existing mine. Mvela currently does not operate a mine.

“It’s a very important deposit for Northam because it’s their only route for expansion at this stage. If they do go down that route it will put them in a position to do a lot of consolidation with other juniors,” van Rooyen said.