[miningmx.com] – Eastern Platinum (Eastplats) shares dropped 11% to R10 on the JSE today after release of a statement indicating there may be a problem with the sale of its South African operations to Chinese group Hebei Zhongbo Platinum (HZP).
Root cause of the problem appears to be a bust-up between shareholders in HZP which became public when Beijing Hehe – apparently a significant shareholder in HZP – issued a statement on October 21 that “the transaction between Eastplats and HZP will not proceed.’
HZP agreed to buy Eastplats’ entire South African business in November last year for $225m in cash. The assets involved include the mothballed Crocodile River Mine near Brits along with the Spitzkop, Kennedy’s Vale and Mareesburg projects.
Announcement of the deal sent the Eastplats share price soaring from around R8 to as high as R22.95 in May before it pulled back to current levels.
According to Eastplats CEO Ian Rozier, “in the light of the position taken and statements made by Beijing Hehe in the release, the company has spoken to Canadian counsel for HZP and has been given to understand that the issuance of the release by Beijing Hehe may be atttibutable to a shareholders’ dispute between the principal shareholders of HZP.
“While the company continues to seek further information on this issue in order to clarify its impact on the company’s dealing with HZP, it has been advised by Mr Yunpu Ma – on behalf of HZP – that it remains committed to the transaction with the company and is working towards a successful conclusion.’
Rozier added that, ‘the company has requested further clarification in writing from HZP and a further news release will be issued when the company is able to provide clarity on the veracity of the (Beijing Hehe) release.
“Until such time as the company can verify the validity of the statements made by Beijing Hehe with respect to the status of the transaction, the company’s understanding is that the transaction between Eastplats and HZP is proceeding. “
