Northam to proceed with RBPlat takeover offer as Implats withdraws complaints

9th March 2023

By: Tasneem Bulbulia

Creamer Media Contributing Editor Online


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Platinum group metals (PGMs) miner Northam Platinum has informed its shareholders that Impala Platinum (Implats) has summarily withdrawn various complaints to the Takeover Regulation Panel (TRP) regarding an announcement by Northam of its firm intention to make an offer to Royal Bafokeng Platinum (RBPlat) shareholders to acquire all of the offer shares for the offer consideration.

There were also complaints about Northam’s proposed increase to the maximum cash consideration for the proposed transaction.

In light of Implats’ withdrawal of its complaints, the TRP has advised Northam that it considers the announcement to be legally valid and that Northam may now proceed with its offer.

As a consequence of the lapse of time since the initially intended posting dates of the Northam offer circular and the Northam transaction circular and the resultant updates required, Northam is engaging with the TRP and the JSE regarding the finalisation and posting of the respective circulars.

Further details relating to the transaction and the related salient dates and times, including the posting dates of the Northam offer circular and the Northam transaction circular, will be published on the JSE’s SENS platform in due course, it says.


Meanwhile, in a trading statement and trading update for the six months ended December 31, Northam reports a 44.9% increase in sales revenue to R20.1-billion; a 55% increase in operating profit to R9.1-billion; and an 11.9% increase in equivalent refined platinum, palladium, rhodium and gold (4E) metal from own operations, following a strong performance from all mines in the group and a 21.9% increase in 4E concentrate produced by Booysendal.

Also, the company’s operating margin increased to 45.1%, demonstrating production cost discipline and efficiencies amid a high inflationary environment, it highlights.

Northam further expects to report a 54.5% increase in earnings before interest, taxes, depreciation and amortisation (Ebitda) to R10-billion; a 60.4% to 70.4% increase in basic earnings a share; and a 62.3% to 72.3% increase in headline earnings a share.

Northam also mentions significant de-gearing, resulting in a net debt-to-Ebitda ratio of 0.62, well within its self-imposed target ratio of one to one in pursuance of the group’s growth strategy.

The increase in the group cash cost per equivalent refined platinum ounce was contained at 14%, despite exposure to a higher inflationary environment and ongoing State-owned utility Eskom load curtailment events.

All organic growth projects are said to be on track.

Meanwhile, Northam says the R17-billion cash consideration under its offer in respect of RBPlat has been fully funded in the form of a cash confirmation and a bank guarantee in favour of the TRP.

All amounts owing to the Royal Bafokeng Holdings arising from the 2021 RBPlat share acquisition have been settled in full.

Northam says R245.5-million of dividends were received from RBPlat during the period under review, with a further attributable dividend of R536.2-million declared by RBPlat to be received by Northam on April 3.

Accordingly, as at April 3, total dividends received from Northam’s investment in RBPlat will amount to R1.3-billion, representing a 13.7% return on cash invested.

Edited by Chanel de Bruyn
Creamer Media Senior Deputy Editor Online



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