Sibanye-Stillwater has terminated the proposed acquisition of the Santa Rita nickel and Serrote copper mines in Brazil from UK-based private equity firm Appian Capital.
Since the signing of the purchase deal last October, Sibanye-Stillwater said that a geotechnical event has occurred at the Santa Rita nickel mine.
The firm conducted an assessment and determined potential material and adverse impacts on the financial condition, properties, assets, liabilities and operations of the mine due to the event.
Under the deal, Sibanye-Stillwater had agreed to acquire the mines for $1bn and a 5% net smelter royalty from the Santa Rita mine’s future production.
The firm also intended to purchase Appian’s Brazilian battery metals-focused portfolio companies Mineracao Vale Verder (MVV) and Atlantic Nickel.
MVV is developing the Serrote copper-gold mine, while Atlantic Nickel operates the Santa Rita mine.
Commenting on Sibanye-Stillwater’s decision, Appian said there exists no lawful basis to terminate the two deals.
The firm said: “To remedy the condition of the area in question, some additional waste will need to be mined earlier in the mine plan which equates to less than 1% of the mine’s volume over a 34-year mine life.
“Appian does not agree that this constitutes a material adverse event.”
Appian is currently assessing legal options and plans to carry out all necessary actions to impose legal rights.
Located in the State of Bahia, Santa Rita is one of the world’s largest nickel-cobalt sulphide open-pit mines.
The Serrate open-pit copper mine is located in the State of Alagoas.