Northam wants control of RBPlat, but open to JV with Impala – CEO

By Nelson Banya

(Reuters) -South Africa’s Northam Platinum wants to take full control of Royal Bafokeng Platinum, but would consider a joint venture with rival Impala Platinum, Northam CEO Paul Dunne said on Friday.

Northam has countered bigger rival Impala’s bid to acquire the mid-tier RBPlat, triggering a takeover battle that has run for more than a year.

Northam’s shares fell more than 8% on Friday to their lowest levels in six months after it skipped a dividend payout despite the 67% profit increase, as the miner focuses on the RBPlat acquisition.

Impala and Northam have built up holdings in RBPlat of 40.71% and 34.52%, respectively, as they jostle to acquire its massive high-grade ore.

“We would like to gain control of the asset and so would Implats. So both of those options are possibilities,” Dunne said during a results call, when asked if Northam would consider joint control of RBPlat.

“If Impala and Northam remain as large shareholders of that asset, I think both companies have a lot of value to bring to bear on that ore body,” he added.

Impala and RBPlat have expressed frustration at the drawn-out takeover battle. On March 2, Impala CEO Nico Muller said South Africa’s state-owned asset manager Public Investent Corporation (PIC), a major shareholder in all three miners, could soon announce which offer it was backing.

The PIC, which owns 20.01% of Impala, 17.15% of Northam and 9.42% of RBPlats – making it a potential kingmaker – says it “supports any transaction that can demonstrate benefits for its clients, their beneficiaries and affected communities”.

Muller has also left the door open, telling analysts on March 2 that while a joint venture was “not ideal”, it could be an option for Impala.

RBPlat is a big part of Northam’s ambitions to raise annual output above 1 million platinum group metal (PGM) ounces. The company expects to produce between 790,000 and 820,000 PGM ounces in the current financial year, which ends in June 2023.

Northam produced 393,303 refined PGM ounces from its own operations during the half-year to Dec.31, an increase of 11.9% from the corresponding period of the previous financial year.

Higher PGM production drove Northam’s headline earnings per share – the profit measure commonly used in South Africa – to 16.09 rand ($0.8890) in the six months ended Dec. 31, from 9.62 rand a year ago.

($1=18.0980 rand)

(Reporting by Nelson Banya; Editing by Sonia Cheema, Clarence Fernandez and Louise Heavens)