[miningmx.com] — WESIZWE Platinum said the financial muscle of its new majority shareholder, the Jinchuan-led Chinese consortium, will enable it to be a major force in the consolidation of the western limb of the Bushveld.
Outgoing Wesizwe CEO, Arthur Mashiatshidi didnt want to name probable targets but in terms of the location of Wesizwe’s flagship Frischgewaagd-Ledig development project, the neighbouring Styldrift, which belongs to Royal Bafokeng Platinum (RBPlats), will make for a natural tie-up. The Styldrift shaft is within view from the Frischgewaagd-Ledig development site.
Styldrift and RBPlat’s adjacent Boschkoppie farm have for long been a target of Impala Platinum which launched a bid worth an estimated R19bn for the assets prior to RBPlat’s R10bn listing in November.
The deal was scuppered by RBPlat minority shareholder Anglo Platinum. However, Implats CEO, David Brown has said on numerous occasions it would revisit the probability of a deal in future. Interestingly, AngloPlat also holds a 13% stake in Wesizwe.
“Sooner or later everyone will have to be looking at consolidation,” Mashiatshidi said. “The cost benefits are overwhelming”.
With Jinchuan in play in the area, one cannot rule out the possibility of a future bidding war similar to the Chinese group’s offer of R9.1bn for copper player Metorex, following a lesser bid by Brazil’s Vale.
The Jinchuan consortium acquired a 45% stake in Wesizwe with an equity funding of $207m as well as providing project funding to the tune of $650m.
It also undertook to finance any shortfall for the project without raising its equity portion, in what Mashiatshidi describes as a “immunity-ticket to further dilution.”
