TSX-listed Dundee Precious Metals subsidiary, Dundee Precious Metals Tsumeb, the owner and operator of the Tsumeb smelter operation in Namibia, has entered into an agreement with Namibian black-empowered investment vehicle, Greyhorse Mining, to transfer 8% of its shares to the investment vehicle to aid previously disadvantaged Namibians.
Moreover, an additional indirect 2% interest in Dundee Precious Metals Tsumeb is also expected to be acquired by an employee trust benefiting Dundee Precious Metals Tsumeb’s employees.
Over the last several years, the Namibian government has been developing a national policy framework referred to as the New Equitable Economic Empowerment (NEEE) Framework that seeks to address economic inequalities within Namibian society with particular focus on six pillars, including: ownership, management, control and employment equity, human resources and skills development, entrepreneurship development and marketing, corporate social responsibility and value addition, technology and innovation.
The Namibian government has recently tabled a draft bill, based on the NEEE Framework, which is currently in the consultation phase. Maintaining a strong license to operate is fundamental to Dundeee Precious Metal’s strategy and requires alignment with the relevant local and national objectives in a given area which guided the structure and governance for the Greyhose Mining and Employee trust transactions.
Empowerment transaction at a glance
The company’s goal in structuring the Greyhorse Mining transaction is to establish an empowerment partnership that is both economically sustainable and as broad-based as possible. The transaction has been structured with the intent of ensuring that groups and individuals receive, directly or indirectly, economic benefits from an ownership interest in Dundee Precious Metals Tsumeb through a combination of dividends and capital appreciation. Through an experienced leadership team and its own network of stakeholders and partners, Greyhose Mining intends to execute a broad-based empowerment strategy based on enterprise and entrepreneurial development, skills development, mentorship and knowledge transfer.
Since purchasing the Tsumeb smelter in 2010, Dundee Precious Metals has made significant investments both in the operation to modernise its facilities and in the local community.
“This transaction is another demonstation of our support to the government of Namibia and its NEEE Framework”, says Dundee Precious Metals president and CEO Rick Howes, adding that as a leader in corporate responsibility, he believe this transaction will help to achieve the objectives of economic empowerment across a broad group of Namibians, including the miner’s own employees.
Saul Kahuika, president of Greyhorse Mining says that the transaction is another example of how Dundee Precious Metals has delivered on its commitments to stakeholders in Namibia and has proactively addressed the NEEE Framework.
The Greyhorse mining transaction remains subject to execution of definitive documentation which has been substantially agreed between the parties and closing is expected to occur by the end of the second quarter.
The structure and documentation associated with the Employee trust transaction is currently underway.