Johannesburg, South Africa — MININGREVIEW. COM — 30 July 2008 – South Africa’s Richards Bay Minerals (RBM) – an unlisted 50/50 joint venture between Rio Tinto and BHP Billiton – has agreed to sell a 26% stake in the company to black investors, but did not disclose the cost.
Reporting from here, Reuters quotes “The Times” newspaper as saying that the value of the deal is about R5 billion, but Rio Tinto spokeswoman Jean Chawapiwa-Pama refused to confirm this. “We are still going through the due diligence, which could be completed in about two weeks, and then the value would be confirmed,” she told the news agency.
South Africa’s Rand Merchant Bank led the selection process for the black investors, which would include lead partners, communities and staff, according to an RBM statement.
This Black Economic Empowerment deal will form part of a programme driven by the South African government to include blacks in the ownership of companies in South Africa. In terms of South African law, companies have to sell 26% of their assets to Black investors by 2014.
Richards Bay Minerals is the world’s biggest titanium producer. It has dredged beach sand for three decades to extract so-called heavy minerals, yielding 1.9 million metric tonnes of titanium, rutile, pig iron and zircon each year. It supplies about a quarter of the global market for titanium dioxide, a white pigment used in paint and dyes.