SA firm in deal to secure 31pc new black ownership

Johannesburg. – Northam Platinum yesterday announced a deal to secure 31,4 percent new black ownership of its shares in a transaction that will raise R4 billion for the platinum miner.
Northam had to put a new black economic empowerment structure in place after Afripalm, headed by Lazarus Zim, and Mvelaphanda Holdings, which held a 26 percent stake in the company, had to sell their investments because falling share prices led to breaches of covenants.

The new transaction would give Northam 35,4 percent black ownership once the 4 percent stake held by the Toro Trust for employees was included.

The new BEE special purpose vehicle would be locked in for 10 years and would not be allowed to encumber its shares in any way or compete with Northam.

Northam would pay this vehicle R400 million to compensate for these conditions.
The company would issue 112,2-million new shares to the vehicle at a price of R41 each, which was a premium to the share price that closed at R35,80 on Tuesday. The Public Investment Corporation and Coronation Asset Management would provide capital of R3,1 billion and R1,5 billion respectively in exchange for preference shares to be issued by the vehicle and which would be listed on the JSE as debt instruments.

Northam would pay the PIC and Coronation a total of R115 million.
The new shares would represent 22 percent of the issued shares.

Northam would then issue the vehicle a further 47,7-million shares already in issue, representing 9,4 percent of shares in issue after the placement of new rights.

The BEE beneficiaries included a number of consortia, employees and communities, Northam said.
Atisa Resources Consortium, represented by Mr Zim, who is also Northam’s chairman, would own 12,8 percent of the BEE special purpose vehicle.

Malundi Resources Consortium would hold 12,8 percent and Women’s Consortium, represented by Brenda Madumise, the chair of Business Unity SA and a former member of the Minerals and Mining Development Board, would own 19,1 percent.

On conclusion of the deal, which must be approved by Northam shareholders, the empowerment participants would be represented by Mpilo Resources Consortium, which would hold 29,8 percent of the BEE special purpose vehicle. – Businessday.