Implats extends offer for RBPlat shares ending hopes of double-quick deal closure

Implats CEO Nico Muller

IMPALA Platinum (Implats) CEO Nico Muller’s hopes of bringing the curtain down on the group’s offer for shares in Royal Bafokeng Platinum (RBPlat) have been dashed after it said after the market close on Thursday it would extend the offer to November 22.

There is a chance Implats could apply to close the offer early but it’s unlikely to “given how close we are to the end”, said company spokesperson Johan Theron.

“We have very little appetite for continued extensions beyond that,” said Muller on September 1 at the firm’s year-end resuls presentation of the then end-September long-stop date on the RBPlat offer “It is important that we have closure on fairly urgent basis,” he added.

However, on September 6, the Competition Appeal Court granted Implats’ rival for RBPlat, Northam Platinum Holdings latitude to argue at a Competition Tribunal hearing that a combination of Implats with RBPlat stymied the ambitions of junior platinum group metal miners, and that it represented anti-competitive behaviour in the confines of the southern African market.

Northam was given 10 days from September 5 to provide further argument of its case. In terms of this Northam can introduce witnesses to the tribunal as well as draw on marketing agreements between Implats and suppliers of concentrate provided the details of the commercial arrangements remain confidential.

Implats will then have 10 days to make its response to Northam’s objections.

“It’s pretty much as we expected,” said Theron at that time. “The appeal court is doing everything necessary to give a fair hearing.”

In terms of its takeover offer, launched in January and since extended twice, Implats has offered a combination of R90 in cash and 0.3 Implats per RBPlat share. Its last stated stake in RBPlat as of today was 39.13%.

Northam has a 34.5% stake in RBPlat with options to increase its holding to about 38%. Paul Dunne, CEO of Northam said earlier this year he wanted to control RBPlat which he described as offering the best PGM production potential in South Africa.

RBPlat has guided to production this year of 505,000 oz of 4E metals in concentrate. It produced 225,500 oz in the six months ended February but unit costs slipped significantly prompting its CEO Steve Phiri to state that uncertainty in respect of Implats outstanding offer for the company had distracted the company and created uncertainty.

“We can’t engage with RBPlat [while the bid is outstanding] and the sooner we come to a conclusion the sooner the parties can get around the table and optimise value for all stakeholders going forward,” said Muller.

The government-owned Public Investment Corporation (PIC) is the kingmaker in respect of RBPlat because it hasn’t decided whether it will vend its shares in RBPlat – standing at just over 9% – into Implats’ offer.

“Our bid for RBPlat is providing a floor to the RBPlat share price,” said Muller in an interview with Miningmx. He added that the PIC risked significant value loss if it allowed the Implats offer to close without supporting the bid.