February marks the launch of the JSS Empowerment Mining Fund that will invest in South African junior miners. It has been established by Jaltech and Stefanutti Stocks.

The objective of the JSS Empowerment Mining Fund is to fill a funding void in the junior mining sector in South Africa, while offering an attractive investment opportunity to investors through extensive risk mitigation and tax benefits. The fund’s target capital is R1 billion.

The JSS Empowerment Mining Fund will operate in a unique niche, providing investment of between R30 and R500 million to qualifying South African junior miners. Importantly, the Fund will support qualifying South African junior miners both in respect of operational expertise and financial stability.

Stefanutti Stocks, a well-established construction, mining and processing company, will provide contract mining and processing services as well as appropriate on-demand guarantees against mining production volumes and processing quality – vastly reducing the operating and financial risks usually associated with junior miners.

“Junior miners globally often struggle to get affordable funding from financial institutions, particularly given recent depressed commodity prices. This is even more so in South Africa,” says Gaurav Nair, director of the Fund. “This gap has been recognised by the South African government who have sought to address the needs of small to medium business owners to grow their business and contribute positively towards the stimulation of the economy.”

The Fund is one of just 43 entities in South Africa operating under the Section 12(J) of the Income Tax Act (Act 58 of 1962) for venture capitalist companies and will offer investors several benefits.

There are eight prospective projects already in the pipeline, totalling R703 billion. These projects will be presented to and evaluated by the investment committee once the Fund has raised R500 million – the minimum capital amount required by the Fund.