Mining Weekly

Following Pallinghurst’s restructuring and successful acquisition of emerald miner Gemfields, the JSE-listed diversified miner will now start with the preparatory work to potentially obtain a premium listing on the London Stock Exchange, with Gemfields delisting from London’s Aim stock exchange by month-end.

Following the takeover offer by Pallinghurst in May to acquire the entire issued and to-be-issued share capital of Gemfields, almost 90% of Gemfields’ shareholders have accepted Pallinghurst’s offer.

This will extend the diversified miner’s life by 50 years, enabling Pallinghurst to develop Gemfields into “the De Beers of coloured gemstones”, according to CEO Arne Frandsen.

Following Gemfields’ delisting, Pallinghurst intends to exercise its rights to acquire all remaining Gemfields shares, subject to reaching the requisite threshold. Pallinghurst will now review the Gemfields business model following discussions with Gemfields’ management, in line with the intentions detailed in the offer document. Further, Pallinghurst intends to integrate the Gemfields business to significantly improve cost savings, unlock value for its shareholders and develop Gemfields in full.

“Management is fully committed to unlocking the significant and full value potential of Pallinghurst for the benefit of all shareholders,” asserted Pallinghurst chairperson Brian Gilbertson in a statement released earlier this month.

Frandsen highlighted that Gemfields was in urgent need of revitalisation, owing to the company’s “tight financial circumstances” and, as such, Pallinghurst’s objective would be to facilitate “a quick and seamless” handover to ensure operational stability and retain shareholder value.

“With debt levels at Gemfields at an all-time high, the need for conservative financial management is evident. That said, further investments in the operations will be sought to secure profitable expansion and growth, as stated in our offer document,” he asserted.

Meanwhile, Gilbertson, Frandsen and Pallinghurst FD Andrew Willis have each provided the company with a renewed five-year commitment. In addition, Sean Gilbertson has been appointed CIO and Priyank Thapliyal COO. They have also been appointed executive directors of the company and have provided a five-year commitment.

After ten years of service, independent nonexecutive directors Clive Harris and Stuart Platt-Ransom resigned from all board committees with effect from July 11. Erich Clarke and Kwape Mmela will serve as independent nonexecutive directors.

Lumkile Mondi has been appointed a member of the audit, nomination and remuneration committees.

Pallinghurst’s executive management will lead operations in the UK, South Africa, Zambia and Mozambique, with dedicated teams deployed in the field.

Gilbertson commented: “We thank Clive Harris and Stuart Platt-Ransom for their ten years’ service to the company. Their input and contributions were outstanding, and contributed significantly to creating the new Pallinghurst.”

He highlighted that certain shareholders had voiced the desire to vote against the two’s reappointment ahead of the company’s annual general meeting, which took place earlier this month.