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Fourth largest platinum producer in the world

The twin-shaft
at Northam
Johannesburg, South Africa — MININGREVIEW.COM — 21 August 2008 – A deal structured by Nedbank Capital will see leading black economic empowerment (BEE) mining company Mvelaphanda Resources increase its stake in Northam Platinum to 63%, thereby creating the fourth largest platinum producer in the world.
A Nedbank news release issued here explained that this would be done through acquiring directly from Anglo Platinum its 22% stake in Northam Platinum, and from the vending-in of a 100% stake of Booyensdal, (50% of which was acquired from Anglo Platinum), to Northam Platinum. Mvelaphanda Resources currently holds 22% of Northam Platinum.

The deal – worth R4 billion – will be funded to the tune of R2.5 billion by Nedbank Capital, with the balance being financed from Mvelaphanda’s own cash resources. Nedbank Capital acted as sole arranger, sole underwriter and advisor to Mvelaphanda Resources on the transaction.

Nedbank Capital managing director Brian Kennedy said the bank was proud to have structured a deal that would help create an extremely significant BEE player in the platinum mining arena.

“This deal marks an historic occasion in the BEE mining space, and we feel honoured to have acted as advisors to the parties involved”, he added.

Mvelaphanda Resources chairman Lazarus Zim, said his company was excited by the prospect of becoming a world-class platinum mining business. He added that his company was particularly positive about the acquisition of a stake in Booyensdal, which still had a life of mine in excess of 100 years, whereas Northam Platinum, for instance, was left with only 17 years.

According to Zim, the acquisition of Booyensdal by Northam is a landmark event, which will create the first fully-integrated, black-controlled platinum mining entity. “This deal reinforces what we envisaged when Mvelaphanda Resources and Afripalm Resources joined forces in 2007, which was to become a pre-eminent black-controlled mining house and principal consolidator of key opportunities,” he concluded.

Northam will rank fourth behind Anglo Platinum, Impala Platinum and Lonmin in terms of PGM resource.