JOHANNESBURG – Lonmin investors have backed the platinum producer’s takeover by Sibanye-Stillwater, bringing to an end a company that was once part of a business empire synonymous with British capitalism in Africa.
Sibanye’s all-share takeover was backed by 98.87% of votes cast at a meeting in London, based on provisional results, passing the required threshold of 75%. The vote is a triumph for Sibanye CEO Neal Froneman, a prolific deal-maker who faced investor concerns that his offer undervalues Lonmin’s assets. Sibanye investors approved the deal earlier in the day.
Froneman, who had already seen off a challenge to the deal from Lonmin’s biggest labor union, will gain access to his rival’s processing facilities and some of the lowest-cost shafts in the industry. The combined entity will challenge Anglo American’s platinum business as the world’s biggest primary producer of the metal.
Lonmin agreed to an offer from Sibanye after struggling through years of losses and being forced to seek debt-covenant waivers from lenders. CEO Ben Magara backed the deal, saying that on its own Lonmin lacked the capital to invest in its operations.
SBG Securities, a unit of Standard Bank Group, said the transaction undervalues Lonmin’s assets by as much as $460-million.
Sibanye’s takeover draws the curtain on a company founded in 1909 to acquire mining rights in then Northern and Southern Rhodesia, now Zambia and Zimbabwe, to become one of Britain’s most prominent companies of the 20th century. Lonmin reconfigured from its predecessor Lonrho Plc in the 1990s to focus on platinum mining.