Northam Platinum has announced that Eurasian Natural Resources divested its stake of 13% in the company less than ten days before the company’s shareholders are due to vote on a plan to raise $376m.
According to the company, 51 million shares were placed with institutional investors at 48.25 rand each in a transaction worth ZAR2.5bn ($204m).
Based on data compiled by Bloomberg, ENRC, which was delisted from London exchange after its founders and the Kazakh Government took it private in 2013, was the second-largest shareholder of Northam.
A review by ENRC found the stake represented a non-core asset and resolved to dispose of in an orderly manner and inform Northam of this intention.
On March 19, Northam shareholders will vote whether to approve a plan to raise black South Africans’ stake in the company through the sale of ZAR4.6bn of stock.
Furthermore, black investors plan to acquire stake from the South Africa’s fund manager Public Investment, for ZAR2bn ($162m), increasing their holding to 35.4%.
According to South African legislation, all mines should be at least 26% held by black shareholders.
Northam Platinum chief executive officer Paul Dunne said: "We are very pleased to again see the strong institutional support for Northam in a difficult platinum market. It is also very positive to see that this support extends to Northam’s BEE transaction."
Image: Northam Platinum mining operations. Photo: courtesy of ENRC.