[miningmx.com] — JUBILEE Platinum said it would recommend a R75m cash offer for the Quartzhill farm which is owned by Tjate Platinum Corporation, an operating firm in which UK-listed Jubilee has shares.
Jubilee Platinum said the offer was from a “major mining company” which one Johannesburg analyst surmised was Anglo Platinum, the Anglo American-listed subsidiary.
“Anglo Platinum is all about breaking down farm boundaries now and the property in question is positioned in the northwest part of the Tjate Platinum farms nearest to Anglo Platinum’s Twickenham mine,” he said.
Quartzhill and the rest of Tjate Platinum Corporation’s properties – Dsjate and Fernkloof – are situated on the western bushveld and are also bounded by Impala Platinum’s Marula mine.
Jubilee Platinum said it would recommend the offer because Quartzhill had not been drilled and was not part of the 44 million ounces in attributable platinum group metals believed to exist on the Tjate Corporation properties.
Colin Bird, non-executive chairman of Jubilee, said he was under severe restriction to name the counterparty, but added that the move for the Quartzhill farm was probably action intended to protect mineral security.
“We’ve seen situations where another company, such as Xstrata, moves in and threatens the long-term security of certain minerals. The mining majors wouldn’t want that,” he said.
Bird also disclosed that although Jubilee was not operating under a cautionary there were ongoing talks about it taking a strategic investor into the Tjate projects. Development of a mine on the Tjate farms is estimated to cost $650m.
“I think the Jubilee share price is very cheap at the moment (£35m or R444.5m). For that you get one of the largest platinum deposits, access to ConRoast facilities which has a small footprint and is cost-effective. We’re also generating cash flow,” he said.
If the deal is completed, the R75m in funds would be put towards acquisition development of the company’s near surface chrome deposit, Bird said.
