SOUTH Africa’s Competition Commission has approved the merger of Sibanye-Stillwater’s platinum operations with Lonmin, the companies announced jointly today.
The remaining regulatory clearances required are the support of the Competition Tribunal, which the commission has recommended, approval by shareholders in Sibanye-Stillwater and Lonmin, and the support of the courts of England and Wales. Sibanye-Stillwater has said previously it hoped the transaction could be concluded in the fourth quarter.
“The positive recommendation by the Commission to the Tribunal is pleasing and on terms which we believe are fair, reasonable and in the best interest of all stakeholders,” said Neal Froneman, CEO of Sibanye-Stillwater, in a statement to the Johannesburg Stock Exchange.
“We are confident that this transaction will not only bring greater stability to these assets and ensure a more sustainable and positive future, but also demonstrate Sibanye-Stillwater’s commitment to the South African mining sector,” he said.
Ben Magara, CEO of Lonmin added: “We are pleased that the parties have reached the agreed conditions and that our transformation journey will continue.”
The Competition Commission noted “… a vertical and horizontal overlap of Sibanye-Stillwater and Lonmin’s activities in the platinum group metal industry,” but added that the proposed merger was “… unlikely to substantially prevent or lessen competition in any of the markets affected by the proposed merger”.
Conditions applied by the commission are that Sibanye-Stillwater continue with Lonmin’s social and labour plan, retain its policy on procurement, and – perhaps most importantly – “… mitigate the potential impact of retrenchments” insofar as operations are supported by metal pricing and synergies the merger will extract”.
