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March 3, 2022

Appian seeks claims from Sibanye-Stillwater for scrapping $1.2bn deal

Appian claims that Sibanye-Stillwater’s termination of the deal was unlawful.

South African miner Sibanye-Stillwater is facing compensation claims from investment firm Appian Capital Advisory for terminating a $1.2bn deal to acquire two Brazilian mines.

Appian served a notice of claim to the miner in this regard.

According to the deal signed in October 2021 with affiliates of funds advised by Appian, Sibanye-Stillwater was set to purchase the Santa Rita nickel and Serrote copper mines.

The purchase price also included a 5% net smelter return (NSR) royalty over potential future underground production at the Santa Rita mine.

Last month, the deal was called off by Sibanye-Stillwater, citing a geotechnical event at the Santa Rita nickel mine.

At that time, the company said that the geotechnical instability would have had a material and adverse impact on the mine’s operations.

However, Appian said abandoning the transaction was Sibanye’s ‘unlawful’ failure.

In a press statement, Appian said: “To justify its termination, Sibanye incorrectly stated, both to Appian and the public, that a material and adverse event had occurred at the Santa Rita mine. Appian believes this characterisation is false, damaging and defamatory.

“In reality, the instability had minimal impact on the mine and these types of occurrences are expected in mature mining operations.

“Appian believes Sibanye-Stillwater’s actions have greatly exaggerated the effect of the geotechnical instability and have materially damaged the market perception of Atlantic Nickel and Appian.”

According to Appian, the instability was a crack in the mine’s pit wall. However, it has had no impact on the operational life of the open-pit mine.

The crack that formed a wedge-shaped rock mass affected less than 1% of the mine’s total surface area and the daily ore mined was more compared to before the event, the firm noted.

In response, Sibanye said that public characterisation of the geotechnical event made by Appian was ‘both superficial and wrong’.

In a statement, Sibanye said: “As Appian is aware, disputes arising from recent events are to be resolved by the English High Court. If Appian decides to commence proceedings, we shall vigorously defend our position and are confident that we will prevail.”

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