Anglo American Platinum has signed a deal to sell its loss-making Rustenburg Platinum Mines (RPM) to South Africa's Sibanye Gold for R4.5bn ($331m).
A unit of global mining group Anglo American, Amplats has faced labour problems at its South African mines recently, including a five-month strike.
Anglo American Platinum CEO Chris Griffith said: "The Rustenburg Operations are quality assets with long-term and sustainable potential under Sibanye's control, given their proven and successful track record of operating conventional mines in South Africa.
"Our focus from the outset has been to identify the right option for the business, its stakeholders and shareholders, and we believe we have concluded a beneficial transaction for both parties, whilst also securing a sustainable future for the Rustenburg Operations."
The Rustenburg Operations comprise the Bathopele, Siphumelele and Thembelani mining operations, two concentrating plants.
The Western Limb Tailings Retreatment on-site chrome recovery plant and associated surface infrastructure and related assets and liabilities are also part of the operations, which comprised a net asset value of R7.7bn ($566m) of 30 June 2015.
Anglo American will use the proceeds to reduce the company's net debt.
The company embarked on a portfolio review during 2012 to address the structural changes taking place in the platinum industry.
As part of its review, the company announced plans to restructure the business, which resulted in the consolidation of Rustenburg from five to three mines and union from two to one mine.
As agreed, Sibanye will sell all concentrate produced by the Rustenburg Operations to Anglo American Platinum until 31 December 2018.
For a period of up to eight years starting in 1 January 2019, the company will sign a toll treatment agreement where Anglo American Platinum will undertake smelting, as well as refining activities in respect of Rustenburg Operations.
Sibanye Gold CeO Neal Froneman said: "We have for some time indicated our interest in participating in the PGM sector and believe that these assets provide an attractively priced entry at an advantageous moment in the price cycle.
"The Rustenburg Operations are similar in nature to Sibanye's current gold operations and, after extensive engagement with AAP and completing a thorough due diligence, we are confident that we will be able to realise value for our stakeholders by leveraging our successful operating model.
"The Rustenburg Operations have been significantly restructured and are well positioned to benefit from a recovery in PGM market conditions and provide a platform to grow regionally within the PGM sector."
Subject to various approvals, the transaction is expected to become unconditional during 2016 with a back-stop date of 30 June 2017.
Image: Anglo American's Union mine in South Africa. Photo: courtesy of AngloAmerican.