The UK Competition and Markets Authority (CMA) has cleared South African firm Sibanye-Stillwater’s proposed £285m acquisition of British platinum group metals (PGM) Lonmin following an investigation.

In May this year, the competition watchdog opened an investigation into the proposed transaction to assess the potential effects of the deal on competition in the market, and invited responses.

Under the terms of the offer made by Sibanye-Stillwater in December last year, every Lonmin shareholder will receive 0.967 of a Sibanye-Stillwater share for each Lonmin share they hold.

“We remain excited about the proposed transaction, which we consider to be in the best interest of our stakeholders.”

Once the transaction is completed, Sibanye shareholders will have an 88.7% stake in the enlarged entity, while the remaining 11.3% will be held by Lonmin shareholders.

Sibanye-Stillwater CEO Neal Froneman and Lonmin CEO Ben Magara said: “We are very pleased to have received the CMA’s clearance, which takes us one step closer to completion of the offer.

“We remain excited about the proposed transaction, which we consider to be in the best interest of our stakeholders.

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“We look forward to the combination of the businesses creating a leading mine-to-market player with enhanced scale and resources, able to compete more effectively.”

The completion of the acquisition is reliant on the receipt of approval by the South African competition authorities and the approvals of Lonmin and Sibanye-Stillwater shareholders.

The companies also need to obtain clearances from the courts of England and Wales.

Last month, the South African Reserve Bank approved the acquisition.

Through the deal, Sibanye-Stillwater intends to combine its existing PGM assets in South Africa with Lonmin’s operations, which will fully integrate PGM production into the company’s operations.

The company will also have access to Lonmin’s metallurgical processing complex, which includes smelting and base and precious metals refining facilities.

The acquisition is expected to result in total pre-tax run-rate synergies of around ZAR1.5bn ($109.39m) by 2021.

Sibanye-Stillwater noted that the parties remain fully committed to the deal, which is expected to be completed in the second half of this year.