JOHANNESBURG (miningweekly.com) – Aim- and JSE-listed Jubilee Platinum has, for a second time, extended the transactional end date for the acquisition of ASX-listed Platinum Australia (PLA) to allow time for certain terms of the proposed transaction to be revised.

The transaction was now expected to close on July 31.

The deal would see Jubilee acquiring all listed ordinary shares in embattled PLA by offering existing shareholders one Jubilee share for every 2.6 PLA shares held, representing an average 194.7-million Jubilee shares.

Jubilee noted in a statement to shareholders on Wednesday that a recent update of the PLA-owned PhokaThaba platinum mine’s proposed business model had reflected the potential for the processing of significant additional quantities of third-party material, owing to its central location in the eastern limb of South Africa’s Bushveld Igneous Complex.

“Jubilee has received a request for the processing of third-party platinum-reef material, which equates to the potential toll processing of up to 40 000 t/m of platinum-containing material,” Jubilee said.

The processing of third-party material had the potential to significantly reduce the funding required to bring the PhokaThaba mine into full operation, as well as to fund the majority of the working capital requirements by generating early revenues from the material processing toll.

“Jubilee has proposed to update the transaction agreement to reflect this option offered to the enlarged group and, by mutual agreement between Jubilee and PLA, the transactional end date has thus been extended,” the company said.

Jubilee CEO Leon Coetzer said the proposed PLA acquisition continued to offer strong value accretion for Jubilee shareholders, while the combined assets offered the flexibility to operate PhokaThaba as a primary mining asset, as well as a significant processor.

“This flexibility adds great strength to the operation and offers the company options to react to a changing platinum market,” he commented.

Financial Performance
Meanwhile, Jubilee reported that unaudited revenues from the group’s smelting and refining operations, as well as third-party electricity sales in the first quarter of 2013, increased by 32% to R16.4-million, from R12.4-million in the fourth quarter of the prior year.

Revenues at group level, which excluded power plant revenues from electricity generated and sold to the Middelburg smelting operations, totalled R6-million for the first quarter, down from R6.4-million in the previous quarter. 

Further, gross profit increased by 47% from R7.6-million in the prior quarter to R11.2-million in the quarter under review, largely owing to the increased third-party sales of electricity generated from the power plant.

Coetzer said the company would continue to drive growth in its operations despite the “challenging” trading conditions.

“The increases in revenue and gross profit highlight the benefits of our focus on earnings growth. Increased processing rates, growing rates of power sales and the creation of a platinum, exploration, mining, processing, smelting and refining business are key to the continued development of the business,” he commented.