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Cape Town - Anglo American Platinum (Amplats) [JSE:AMS] has completed the sale of its interest in Union Mine and Masa Chrome, a move it says will allow it to focus on its most competitive assets.
The sale of the platinum mining company's 85% interest in Union Mine - located near the small town of Swartklip on the border of Limpopo and North West - and its 50.1% interest in Masa Chrome Company was first announced on February 15 2017.
“The upfront disposal proceeds of R400m will be received in the form of cash on February 1 2018 and used to reduce net debt and further strengthen Anglo American Platinum’s balance sheet,” Amplats said in a media statement on Friday.
At 10:45 Amplats shares were trading at R369.86 on the JSE, up 1% on the day.
Siyanda Resources will take over the ownership and management of the mine and the chrome recovery business from February 1. It already owns 26% of Masa Chrome, meaning that from February 1 it will own 76% of the business.
As part of the agreement, Siyanda will sell concentrate produced by Union Mine to Anglo American Platinum for a period of seven years.
'Repositioning'
Amplats CEO Chris Griffith said that with the sale of Union Mine the mining group has completed a “core part of its strategy of repositioning the portfolio”.
This includes disposing of other mines.
“This transaction will allow us to focus on our most competitive assets, which are largely open-pit and mechanised operations which will result in higher margin production, a smaller and more highly skilled workforce, safer operations and a less complex organisation,” he said.
Lindani Mthwa, group chairperson of Siyanda Resources, said Union Mine and Masa Chrome operations are “quality assets which have long-term potential under Siyanda’s ownership and management”.
The Bakgatla-Ba-Kgafela community will still own some 15% of Union Mine.
“This transaction is mutually beneficial for all parties involved and, through our partnership with the Bakgatla-Ba-Kgafela and our employees, we believe that we will create a sustainable future for the operation,” said Mthwa.
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