RBPlat’s Phiri delivers spectacular attack on RBH for selling “heritage” to Northam Platinum

Steve Phiri CEO of Royal Bafokeng Platinum

STEVE Phiri used his last presentation as CEO of Royal Bafokeng Platinum (RBPlat) to deliver a spectacular attack on the firm’s former shareholder, Royal Bafokeng Holdings (RBH) which he said betrayed shareholders by selling its 32.8% stake to Northam Platinum.

Phiri said RBH “abandoned shareholders” and had “poured cold water” on the “celebration” of RBPlat’s position as a vehicle for consolidation in the platinum group metals (PGMs) sector.

Phiri also had stern words for Northam Platinum saying that “… any person who is contemplating some offer must put up or shut up … The shareholders of RBPlat deserve some respect and certainty.”

The purchase of the RBH stake in RBPlat by Northam on November 9 effectively stymied a 100% takeover of RBPlat by Impala Platinum (Implats) which had announced its intentions during October.

Phiri also criticised Royal Bafokeng Nation, the North West province community that stands behind RBH. “You do not give that heritage up even for the most tempting price. That must not be forgotten,” he said, referring to the nation’s historic purchase of North West province property.

Northam’s position in RBPlat resulted in “a messy contest between two strangers in the launch area of RBN [Royal Bafokeng Nation], leaving RBN a spectactor in its own house,” said Phiri who added – somewhat ominously for Implats’ consolidation plans: “It will take some time to resolve … if at all.”

Phiri announced his retirement after 11 years at RBPlat. His impending departure raises major questions about who will be leading the company as Hanré Rossouw, the firm’s CFO last year announced he would be joining Sasol, the petrochemical firm in May. It also emerged today that RBPlat’s COO, Neil Carr is also planning to leave the firm.

Said Phiri when asked about the potential management vacuum: “I can linger. The board has asked me to stay until the firm achieves certainty. I am also in discussions with Neil to see if he will stay.” Carr replied he remained “supportive” adding “we are in this together”. Rotshidzwa Manenzhe, a long-standing RBPlat employee, has been appointed acting CFO.

RBPlat posted a 40% year-on-year improvement in profit after tax of R7.1bn which was softer than some analysts expected. Nonetheless, RBPlat produced record production of 4E PGMs totalling 467,000 ounces, a 11.5% year-on-year increased sold at an average basket price of R54,698/oz – 14% higher.

The company has targeted 4E PGM production of between 485,000 and 505,000 oz in the current financial year produced at a total operating cost of R16,500 and R17,200/oz.

RBPlat declared a final dividend of 535 South African cents per share for the year ended  December 31. Equal to about R1.5bn, the final dividend matched the interim payout taking the total return to R10.70/share – double the return in RBPlat’s 2020 financial year.

Asked about RBPlat’s approach to the dividend, Rossouw said the company had kept in mind potential disruption from the war Russia is waging in Ukraine. RBPlat would also be prevented from issuing equity whilst it was under offer from Implats.

Phiri responded angrily to a question that RBPlat as to whether shareholders had been able to exert some influence over the board’s decisions about dividends.

“Our board consists of credible men and women with integrity who take their jobs and fiduciary responsibilities very seriously,” he said. “As a board we are not run by an individivual shareholder,” he added.