Johannesburg, South Africa — 23 September 2013 – Northam Platinum Limited, operator of the world’s deepest platinum mine, is to raise R1 billion (US$103 million) from bank loans and the sale of shares as it seeks to offset strike action and repair equipment.
Bloomberg News quotes a company statement as saying that Northam will raise R600 million through a so-called claw-back offer, fully subscribed by Coronation Asset Management (Pty) Limited, in which 15 million shares will be sold at R40 each. Banks will make 400 million rand available from a new revolving credit facility that ends on March 31, 2015.
“Challenging economic and operational conditions have beset the South African mining industry for an extended period of time, with depressed platinum group metal basket prices, volatile exchange rates, rising costs and a complex industrial relations environment,” the company statement added.
Northam lost R192 million of revenue in April after workers at its Zondereinde mine went on strike for three weeks resulting in reduced production. The funds raised will also be used to rebuild a smelter, ensure completion of the Booysendal mine and maintain equipment at its Zondereinde facility, it said.
The company, which posted a 70% rise in annual profit last month, said it had fully drawn down its current R1 billion revolving credit facility.
Source: Bloomberg News. For more information, click here.