Denver, USA — MININGREVIEW.COM — 10 September 2008 – The chief executive of Platinum Group Metals Limited (PTM) says he is confident that the junior miner will raise enough capital to finance a deal to double its stake in the Western Bushveld joint venture, despite a challenging credit market.
Last week PTM agreed to a deal with partners Anglo Platinum Limited and Wesizwe Platinum Limited to double its stake at Western Bushveld to 74% of the joint venture. Anglo Platinum was selling its 37% interest in the joint venture in a Black Economic Empowerment (BEE) transaction. Under the proposed deal, PTM would pay no new cash or shares until up to six months after closing.
“Our main job now is to complete the detailed agreements with Anglo Platinum, to put the banking syndicate together, and to raise that production capital,” PTM chief executive Michael Jones told Reuters in an interview at the Denver Gold Forum.
Western Bushveld is a developing mine with reserves in PGMs and other precious metals. “Production is due to start in 2010, and output will ramp up in 2011 and 2012,” Jones said.
The proposed deal would double PTM’s planned production to 185 000 ounces of platinum, palladium, rhodium and gold per year from its previous 92 500 ounces.
“We’ve had very strong interest from nine different banks, particularly South African banks that are not affected by the sub-prime virus,” Jones revealed. “Obviously the current market condition is a challenge, but I am confident that with the support of our shareholders we can put the package together,” he added.
Speaking about platinum in general, Jones said: “We are very confident about the long-term fundamentals of platinum. It’s in short supply and it’s essential to the world economy,” Jones concluded.