Phiri to head new platinum firm

[] — MERAFE Resources CEO Steve Phiri will step down at the end of March to become CEO of Royal Bafokeng Holdings’ (RBH’s) new platinum company.

Phiri will be replaced as CEO by current financial director Stuart Elliot, and will remain a non-executive director of ferrochrome producer Merafe.

The platinum company – dubbed Newco at this stage – is to be listed on the JSE within the next 24 months. Indications are it could play an important role in the consolidation of various platinum mines in the Rustenburg region.

Newco will own 67% of – and have operational control over – the Bafokeng Rasimone Platinum Mine (BRPM) joint venture (JV), in which the minority partner is Anglo Platinum subsidiary Rustenburg Platinum.

The BRPM JV’s main assets are the operating BRPM mine and the adjacent Styldrift deposit, which is as yet undeveloped.

The two assets were previously held 50-50 through the BRPM JV between Royal Bafokeng Resources (RBR), a subsidiary of RBH, and Rustenburg Platinum.

That was renegotiated last year to give RBR control and the new structure became unconditional in mid-December.

According to a joint statement released on December 11, a “brand and name’ for Newco would be announced early this year.

Phiri’s management team will include Nico Muller as chief operating officer and Martin Prinsloo as chief financial officer.

Muller is a former general manager of Two Rivers Platinum, while Prinsloo was previously head of corporate finance and acting joint chief financial officer at Anglo Platinum.

In terms of the restructuring, Rustenburg Platinum swapped 17% of its stake in the BRPM JV for a 25% stake in Newco “which is to be listed within 24 months, subject to market conditions. Until listing, Anglo Platinum retains an effective 50% economic interest.’

RBH CEO Niall Carroll said in December: “The enhanced focus of a dedicated management team, supported by strong empowerment credentials and a solid capital structure, should unlock significant sustainable value for all stakeholders and we look forward to the culmination of our stated intention to create an independently listed, black-controlled PGM [platinum group metals] producer through the listing of Newco on the JSE.’

There has been considerable market speculation over what moves Newco may make, given RBH’s close links to the two largest platinum groups.

Not only does the RBH have Anglo Platinum as a JV partner in Newco, but it is also the largest shareholder in Impala Platinum (Implats) in which it holds a 13.2% stake.

Carroll played a key role in the ousting of former Implats chairman Fred Roux last year and Roux’s replacement by Khotso Mokhele, who is believed to be close to the Royal Bafokeng.

There is a feeling among some observers that the Royal Bafokeng have strengthened their hand at Implats as a result, but that’s denied by Implats CEO David Brown.

In an interview with Miningmx after the recent presentation of the group’s interim results, Brown said: “I don’t think the Royal Bafokeng have undue influence on either the Impala board or Impala management.’

Carroll has previously indicated that Newco would be a platform for the consolidation of “mid-tier regional platinum group metal assets’.

That being the case, Newco’s assets are strategically sited. The Implats lease area is contiguous with the eastern boundaries of both BRPM and Styldrift.

The western boundaries of BRPM and Styldrift are adjacent to Wesizwe Platinum’s core Frischgewaagd-Ledig properties.

These in turn link into what is known as the Western Bushveld JV between Anglo Platinum and TSX-listed Canadian junior Platinum Group Metals (PTM) .

There are minority cross-holdings between PTM and Wesizwe in their respective projects.

Wesizwe is currently trading on the JSE under a cautionary notice.

The writer owns shares in Impala Platinum and Wesizwe Platinum.