The approval from both Sibanye and Stillwater shareholders was granted at their respective general meetings on 25 April 2017, which signalled that all major conditions precedent to the transaction have been met to the parties’ satisfaction.
In an announcement on 26 April, following the conclusion of the transaction – which ranks among the largest mining transactions conclude by a South African company since 2001 – Sibanye CEO Neal Froneman thanked its shareholders for their support, as well as the management and employees of both companies, whose efforts enabled Sibanye to successfully conclude this significant transaction.
Stillwater, located in Montana in the US, owns the highest grade platinum-group metals (PGM) mines in the world. In addition it is the lowest cost PGM producers in the world (on an all-in sustaining cost basis which includes sustaining capital expenditure requirements).
This combination and the fact that it is the only primary palladium producer in the world, makes it unique and strategically positions Sibanye as a unique investment case.
Stillwater currently produces approximately 550 000 ozpa of 2E PGM (PGM split of approximately 78% palladium and 22% platinum) from two operating mines. The company is also developing a low risk organic growth project the Blitz project, which is expected to add between 270 000 ozpa and 330 000 oz 2E PGM by 2021. This is a substantial production increase of over 50%, which is fully funded from internal cash flow.
Stillwater is also the biggest PGM recycling business in the world, recycling about 668 000 oz of PGMs during 2016. This business will provide Sibanye with important strategic insights into the secondary PGM markets.
This transformative transaction uniquely positions Sibanye as a global precious metals company with a unique mix of commodities. Sibanye is now the third largest producer of palladium (and only primary producer of palladium) and the third largest producer of platinum in the world and also features in the top ten global gold companies.
“We are very pleased to add Stillwater into the Sibanye Group, thereby creating a unique, high quality, global precious metals company.
“We look forward to integrating Stillwater into Sibanye and are confident that this transaction will realise significant value for our shareholders and its other stakeholders for many years,” says Froneman.