Engineering & Mining Journal

JAN 2013

Engineering and Mining Journal - Whether the market is copper, gold, nickel, iron ore, lead/zinc, PGM, diamonds or other commodities, E&MJ takes the lead in projecting trends, following development and reporting on the most efficient operating pr

Issue link: https://emj.epubxp.com/i/102812

Contents of this Issue

Navigation

Page 19 of 99

REGIONAL NEWS - AFRICA Mimosa Agrees to Zimbabwe Indigenization Plan Aquarius Platinum announced in midDecember 2012 that Mimosa Investment Holdings, which it holds jointly in a 50:50 partnership with Impala Platinum, had agreed to sell a 51% interest in Mimosa to indigenous Zimbabwean parties for $550 million. Mimosa's primary asset is the Mimosa platinum mine on the southern portion of the Great Dyke in Zimbabwe. Production totals about 210,000 oz/y of platinum group metals. The sale price was based on an agreed fair market value for Mimosa Holdings of $1.078 billion. Mimosa Investments will provide a vendor loan funding mechanism to facilitate the transaction, which has a term of 10 years. The loan will bear interest at a rate of 9% annually and will be settled through the waiver of the right to receive 90% of dividends due to the indigenous entities in favor of Mimosa Investments. Any loan balance outstanding at the end of the 10-year period will be payable in cash. Mimosa Investments will continue to provide management and technical services for the mine. The 51% indigenization interest will be held 10% by the Zvishavane Community Share Ownership Trust, Zvishavane being the community in which the Mimosa mine is located; 10% by an employee share ownership trust to be established for the benefit of all permanent indigenous employees; and 31% by the National Indigenization & Economic Empowerment Fund. Assuming receipt of regulatory approvals, the transaction is expected to close by the end of March 2013. Jean Nel, CEO of Aquarius, said, "Although the negotiations have taken some time, the final plan represents a significant milestone for Aquarius and Mimosa as we work towards full compliance with the law and regulations in Zimbabwe. The indigenization plan, once implemented, will offer Mimosa security of tenure and is a true reflection of the worth of our investment in Mimosa Investments, a valuable asset and one of the lowest-cost producers in the PGM sector globally. The Mimosa platinum operation in Zimbabwe produces about 210,000 oz/y. The two equal partners in the Mimosa enterprise recently agreed to sell a 51% interest in it to a Zimbabwean indigenous group. 18 E&MJ; • JANUARY 2013 "A particularly pleasing aspect of the plan is that it includes an employee share ownership trust as well as a community trust, so as to ensure all stakeholders benefit from the continued operation of Mimosa. Mimosa's relationships with the government of Zimbabwe, its employees and communities have been fundamental to its success in the past and will remain important in the future." Rio Tinto and Anglo American Selling Palabora Interests Rio Tinto and Anglo American announced on December 11, 2012, agreements to sell their interests in the Palabora Mining Co. in South Africa to a consortium of South African and Chinese entities led by Hebei Iron & Steel and the Industrial Development Corp. of South Africa (IDC). Palabora operates a large block cave copper mine and smelter complex employing 2,200 people in Limpopo province, South Africa. The company produces about 80,000 mt/y of refined copper, supplying most of South Africa's copper needs and exporting the balance. The refinery produces continuous cast rod for the South African market and cathodes for export. Byproduct metals and minerals include zirconium chemicals, magnetite, and nickel sulphate, as well as small quantities of gold, silver, and platinum. Rio Tinto will sell its 57.7% effective interest in Palabora for $373 million. Anglo American will sell its 16.8% effective interest for ZAR893 million (about $103 million). Guy Elliott, CFO of Rio Tinto, said, "Palabora is a good business but is no longer a natural fit within Rio Tinto's portfolio. Selling our stake reflects Rio Tinto's policy of continually reviewing our portfolio to generate best value for shareholders." The purchasing consortium includes Hebei (35%), a leading international steel producer owned by the Chinese government; General Nice Development Ltd. (25%), a privately-owned Chinese trading company; Tewoo Group (20%), a major diversified group wholly-owned by the Chinese government; and IDC (20%), a development finance institution whollyowned by the South African government. www.e-mj.com

Articles in this issue

Links on this page

Archives of this issue

view archives of Engineering & Mining Journal - JAN 2013