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Johannesburg - Gold Fields is unperturbed about the possible exit of Mvelaphanda Resources as its empowerment partner if a takeover deal with Impala Platinum goes through.
Mvela and its subsidiary Northam Platinum are the subject of a friendly takeover bid by Impala Platinum. Mvela has stakes in a number of companies that Impala will want to dispose of if the transaction goes through.
Even if the Impala deal doesn't happen, Mvela has for a while been hinting that it is not a long-term holder of Gold Fields shares.
Gold Fields CEO Nick Holland said Mvela's stake in his company's SA assets has been "crystallised" into 50 million shares to be issued by the listed gold company to its empowerment partner.
The shares are likely to be sold, but Gold Fields has the first right to buy them. At current prices, they are worth R2.8bn. They will come on top of the 653 million shares already in issue.
"They are free to treat them as they want to. There is no lock-up of these shares," Holland told a media briefing on the company's September quarter results.
"Irrespective of the Impala deal going ahead or not, those shares would be sold at some point," he said, arguing it was only right for empowerment companies to be able to realise value from their investments and sell shares.
Once empowered, always empowered
Holland argued that there was an implicit understanding in the Mining Charter of once empowered, always empowered, meaning Gold Fields which was 15% black empowered would remain so even if its empowerment partner sold those shares.
The Mining Charter requires mining companies to have 15% of their equity owned by black people by 2009 and 26% by 2014 to secure mining and prospecting rights. There are a host of social and labour obligations that have to be met too.
Asked by Business Day at the briefing about how the company would reach its 26% target for black empowerment, Holland said an employee share ownership scheme would make up a significant chunk of the 11% it still needs. He said the company will receive empowerment credits from past deals.
"If you factor all of that in, we're not far off the 26% target and it's not unduly concerning for us at this point," he said.
- Miningmx.com
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