This follows a vote on the business rescue plan (BRP) by the creditors on 24 March 2016.
The BRP will now seek to execute the relevant sale agreements at the lower purchase price with Samancor Chrome as quickly as possible.
This lower purchase price follows the settlement in January between IFMSA, International Ferro Metals SA Holdings and Rustenburg Platinum Mines (RPM), regarding its interests under a chromite supply agreement under which RPM is obliged to supply UG2 chrome ore to IFMSA.
Under the terms of the settlement, RPM will supply IFMSA with 10 000 tpm of UG2 per for calendar year 2016 at no cost and 7 500 tpm from January 2017 to November 2020 at a cost of R170/t.
The backlog of approximately 57 000 t at the end of December 2015 will be supplied at a rate of 10 000 tpm from January 2016, also at no cost.
At the time of the announcement, IFM said this settlement had a material impact on the purchase consideration to be payable by Samancor for the assets of IFMSA. Samancor has therefore reduced its aggregate offer price from R720 million to R520 million.
The aggregate consideration will be paid in three divisible tranches:
- R310 million for the business and assets of IFMSA;
- R140 million for the IFMSA mining right and beneficiation plant; and
- R70 million for certain receivables of Sky Chrome and Sky Chrome’s equity for R1;
Meanwhile, the amended plan also provides an illustration and estimate of the potential distribution to creditors of IFMSA, and based on the plan’s distribution schedule, it is not likely that International Ferro Metals shareholders would receive any distribution from the conclusion of the business rescue process.