SIBANYE-Stillwater announced on Monday it agreed to buy US-based precious metals recycling business Metallix Refining for $82m (R1.5bn) in cash.
Metallix Refining, a profitable company in business for 60 years, would complement Sibanye-Stillwater’s Reldan which it acquired last year for $155.9m.
Neal Froneman, CEO of Sibanye-Stillwater said Metallix would add “scale, technology and know-how” to his company and bring “value uplift through the large number of synergies with our existing recycling operations”.
Metallix produced gold and a suite of platinum group metals including 48,000 ounces of palladium and platinum each as well as 874,000 ounces of silver and 263,000 pounds of copper in its 2024 financial year ended December 31.
The company processes the metals from industrial waste streams at its two recycling operations in Greenville, North Carolina which it then supplies to customers from the UK and South Africa as well as in the US.
Reldan produced 145,000 ounces of gold in its 2022 financial year as well as 22,000 oz of palladium, 25,000 oz of platinum and 3.4 million pounds of copper. Sibanye-Stillwater also has recycling capability at its Montana-based Stillwater mine.
Commenting on rationale for the deal, Sibanye-Stillwater said acquiring Metallix extended its global recyclng reach and logistics.
The deal is expected to close in the third quarter.
Sibanye-Stillwater seems to be looking outwardly again following a grim two years of restructuring and cost cutting as it weathered a major correction in platinum group metal prices.
Speaking to Miningmx in June, Froneman said his company expected to approve the restart of its R5bn Burnstone gold project in South Africa’s Mpumalanga province.
There was “no question” the 120,000 ounce a year project was “a good one,” said Froneman. A feasibility study into it, launched last year, was focused not on the project’s fundamentals but on specific ramp-up issues such as staffing.
Sibanye-Stillwater reported much improved first quarter numbers in May. Adjusted Ebitda of R4.1bn represented an 86% improvement year-on-year. This was owing in part to the group’s gold mines which comprised R1.16bn of the ebitda improvement after the price received increased to R1.68m per kilogram, a year-on-year increase of 34%.
Since then, the platinum price has been on the march, dragging palladium with it, as the market begins to recognise a supply deficit in both metals. The platinum price is 60% higher year-to-date while palladium has gained 44%.
According to a report by RMB Morgan Stanley analysts today, Sibanye-Stillwater is cash flow positive at spot metal prices, excluding the capital required for completion of its 78.9% owned Keliber lithium project in Finland.
Sibanye-Stillwater will spend about R4.3bn this year completing Keliber. First production of lithium hydroxide, produced from ore mined at the site, is scheduled for 2026.
