South African mining holding company Gencor announced on Monday long-flagged plans to offload its shares in Impala Platinum, saying it would distribute its 46%stake to shareholders on November 4.
The offloading of Gencor’s holding in the world’s second-largest platinum miner had long been expected but the expiry of an agreement that allowed Gencor to unwind the stake, and Implats results in August, came and went without news of the sale.
The announcement was believed to have been delayed by legal claims against Gencor for asbestos-related diseases from miners who say they contracted the disease while working for mines linked to Gencor.
Gencor said on Monday it did not believe it was liable in South African law for any of the R37-million claimed from Gencor and had instructed its attorneys to defend each of 37 claims against it.
”Gencor has not made any provision for any of these claims as it believes it has no liability under any of these claims,” it said in a statement.
However, Gencor said it had R409-million in cash reserves that it did not yet plan to distribute but would use, among other things, to defend the 37 summonses and to cover any other potential liabilities or obligations it might have.
”Once the proposed unbundling of the Implats’ distribution shares has been successfully completed the position of the company will be further reviewed and shareholders advised accordingly,” it said.
Gencor currently holds around 30,6-million Implats shares, which values the stake at some 17,9-billion rand based on Implats’ Friday closing price of 586 rand.
The holding company said it would distribute to Gencor shareholders its Implats shares on November 4, subject to approval of the scheme by shareholders at a general meeting on October 2 and regulatory approval.
Assuming Gencor held the same number of shares on November 4 as at present, those registered as Gencor shareholders on October 11 would get about 8,7 Implats shares for every 100 Gencor shares held.
Gencor will be delisted several months after the unbundling, which is expected to make Implats shares far easier to trade.
Shares in Implats skipped up 2,6% in opening trade to R601. Gencor climbed one percent to R50,50, outperforming a mild rise in the broader market. – Reuters