Sibanye Gold to Buy Aquarius Platinum for $294 Million
06 October 2015 - 7:57PM
Dow Jones News
By Alex MacDonald
LONDON--South Africa's largest gold miner Sibanye Gold Ltd.
(SGL.JO) said Tuesday it has entered into an agreement backed by
Aquarius Platinum Ltd.'s (AQPTY) board to buy all of the South
Africa-focused platinum producer's shares for $294 million in
cash.
For Sibayne, the transaction represents a continued effort to
diversify its business into platinum, where it believes it has the
ability to extract value over the long term despite depressed
platinum prices in the near term. Sibayne announced on Sept. 9
plans to purchase the Rustenburg platinum mine operations from
Anglo American PLC (AAL.LN) for at least 4.5 billion South African
rand ($324 million).
Under the transaction, which is forecast to close in the first
quarter of next year, Aquarius shareholders will receive $0.195 a
share, or roughly 12.9 pence a share in cash, representing a 60%
premium to Aquarius' closing share price of GBP0.08 on Monday, the
trading day prior to the announcement.
Aquarius' shares in London jumped 46% to 11.75 pence share as of
0753 GMT while Sibanye's shares were up 4.5% at ZAR18.73.
Neal Froneman, chief executive of Sibanye said his company
should be able to extract significant cost savings by combining
Aquarius Platinum's Kroondal mine with the adjacent Rustenburg
mine, thereby justifying the premium offered for Aquarius.
The Aquarius deal would also give Sibanye a foothold in
Zimbabwe, which hosts the second largest platinum reserves in the
world, via Aquarius' Mimosa mine.
"At higher platinum group of metal prices, these assets also
offer a substantial increase in earnings and value for Sibanye
shareholders," Mr. Froneman added.
-Write to Alex MacDonald at alex.macdonald@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
October 06, 2015 04:42 ET (08:42 GMT)
Copyright (c) 2015 Dow Jones & Company, Inc.
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