/ 20 August 2008

Nedbank funds Mvela in Northam deal

Nedbank Capital has structured a deal that will assist BEE mining company Mvelaphanda Resources increase its stake in Northam Platinum to 63%, the bank said on Wednesday.

”This deal marks a historic occasion in the BEE mining space and we feel honoured to have acted as advisers to the parties involved”, said Brian Kennedy, managing director of Nedbank Capital.

The deal will be facilitated through acquiring directly from Anglo Platinum its 22% stake in Northam Platinum, and from the vending-in of a 100% stake of Booyensdal (50% of which was acquired from Anglo Platinum) to Northam Platinum.

Mvelaphanda Resources currently holds 22% of Northam Platinum.

The deal, worth R4-billion, will be funded to the tune of R2,5-billion by Nedbank Capital, with the balance being financed from Mvelaphanda’s own cash resources.

Lazarus Zim, chairperson of Mvelaphanda Resources, said his company was excited at the prospect of becoming a world-class platinum mining business.

Zim added that the company was particularly positive about the acquisition of a stake in Booyensdal, which still has a life in excess of 100 years.

”Prospects of our continuing presence in the platinum group metals [PGM] space looks decidedly positive”, he said.

”This acquisition will strengthen our position both in the western and eastern limbs of the Bushveld where the PGM ore body is mostly found”, he added.

The acquisition of Booyensdal by Northam was a landmark event, which would create the first fully-integrated black-controlled platinum mining entity, Zim said.

Northam will rank fourth behind Anglo Platinum, Impala Platinum and Lonmin in terms of PGM resources. – Sapa