South African firm Anglo American Platinum has met all required criteria regarding the sale of its interest in Union Mine and MASA Chrome Company to a subsidiary of Siyanda Resources.
In February last year, Anglo American Platinum subsidiary Rustenburg Platinum Mines entered a sale and purchase agreement (SPA) to sell 85% interest in Union Mine and a 50.1% interest in MASA Chrome.
With all conditions having been met, Siyanda will take over ownership, control, and management of the sold resources from 1 February this year.
Union Mine and MASA Chrome are located in South Africa’s Limpopo and North West provinces.
Anglo American Platinum CEO Chris Griffith said: “In addition to the sales of Pandora and Rustenburg, with the completion of Union, Anglo American Platinum has executed a core part of its strategy of repositioning the portfolio.
“This transaction will allow us to focus on our most competitive assets, which are largely open-pit and mechanised operations, which will result in higher margin production, a smaller and more highly skilled workforce, safer operations and a less complex organisation.
“Our core operations will benefit from dedicated management attention, technical expertise, as well as enabling us to focus our capital allocation.”
Under the transaction, Anglo American Platinum will receive upfront disposal proceeds of R400m ($33.61m) in cash, which would be used to reduce net debt.
Furthermore, a deferred consideration based on 35% of cumulative positive distributable free cash-flow will be paid per annum as an earn-out for ten years.
Siyanda will also sell concentrate produced by Union Mine to Anglo American Platinum for seven years from the transaction’s effective date.