Johannesburg- and London-listed platinum group metals and chrome producer Tharisa has acquired the remaining 26% shareholding in Tharisa Minerals, in what is a landmark broad-based black economic empowerment (BBBEE) deal.
Tharisa offered 13.9-million new shares, valued at $25-million, in exchange for the shareholding.
Tharisa Minerals’ flagship asset is the openpit Tharisa mine and beneficiation plant. Its ownership structure comprised of BBBEE shareholders Thari Resources, which held a 20% interest, and the Tharisa Community Trust owning 6%.
This affords Tharisa the opportunity to constitute Tharisa Minerals as a wholly-owned subsidiary that meets the empowerment requirements set by the Mineral and Petroleum Resources Development Act and the Mining Charter, while allowing the BBBEE shareholders to benefit from the wider and diversified asset portfolio of the Tharisa group.
The proposed share exchange and the valuation of the exchange account for the historical funding provided by the company in its role as the investment holding company, with the BBBEE shareholders having a free funded carry, resulting in BBBEE shareholders holding unencumbered shares in Tharisa Minerals and now Tharisa.
“The simplification of the corporate structure ensures that our BBBEE shareholders participate in regular dividend flows consistent with the company’s shareholders, with a dividend policy of distributing at least 15% of consolidated net profit after tax,” the group explains.
The deal will see 10.7-million shares issued to Thari Resources, representing 3.7% of Tharisa’s issued and outstanding share capital, and 3.2-million shares issued to the Tharisa Community Trust, resulting in ownership of 1.1%.