[miningmx.com] – SHAREHOLDERS in JSE-listed Sephaku Holdings are
today expected to vote on a transaction in which the group will unbundle its fluorspar
asset, Sephaku Fluoride.
Fluorspar is used in the production of hydrogen fluoride and also has end uses in
the manufacture of steel and aluminium. Sallies is one of the few producers of
fluorspar in South Africa; a company that has suffered the effects of a volatile market
for the mineral in the past.
Alan Smith, CEO of Incubex – the investment group that has shares in Sephaku
Holdings and is motivating for the unbundling of Sephaku Fluoride – said the endgame
was to re-list the fluorspar assets within 12 months after unbundling.
Access to capital markets is all-important to Sephaku Fluoride as the company
will seek a total R2.2bn in finance. Some R900m would be to build Sephaku Fluoride’s
Nokeng mine, 70 km north-east of Pretoria, with the balance required for a
beneficiation plant.
Nokeng Fluoride, which neighbours Vergenoeg fluorspar mine, is estimated to produce
16,000 tonnes/year of fluorspar, some of which could be sold to clients such as BHP
Billiton’s aluminum smelters, said Smith.
The beneficiation plant will produce sulphuric acid, a hydrogen fluoride plant and an
aluminium fluoride plant.
According to a previous announcement, Sephaku Holdings said the acid-grade
fluorspar produced by the Nokeng concentrator will be used largely as feed to the
production facility, a key feature of which will be the production of 60,000
tonne/year anhydrous hydrogen fluoride.
Incubex was “close to securing’ an equity investor, but could not disclose its identity
at this stage, Smith said.
“We are excited about the asset. The investment case is good with an internal rate of
return in the high 20s and a net present value of about R2.2bn,’ he said.
Shephaku Holdings was listed in 2008 but its backers – mining entrepreneurs Rudolph
de Bruin and David Twist (who also founded Platmin) – recognised it wasn’t receiving
value for its wide-ranging mineral products, which included tin, gold, diamonds,
limestone and coal.
As a result, many of these assets were spun off into Incubex, which recently became
a major shareholder in Miranda Mineral Holdings. The mainstay asset in Sephaku
Holdings is Sephaku Cement.
