Anglo American Platinum's wholly owned subsidiary Rustenburg Platinum Mines has completed the sale of its Rustenburg Operations to Sibanye Rustenburg Platinum Mines Proprietary Limited.
With this completion, Sibanye takes over the ownership, control and management of Rusenberg Operations.
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Rustenburg Operations consists of Bathopele, Siphumelele (including Khomanani), and Thembelani (including Khuseleka) mining operations, two concentrating plants, an on-site chrome recovery plant and the Western Limb Tailings Retreatment Plant.
It also comprises associated surface infrastructure, related assets and liabilities, including normalised levels of working capital.
Anglo American Platinum CEO Chris Griffith said: “This is a major step in the repositioning of Anglo American Platinum’s portfolio.
"The sale of the Rustenburg Operations allows us to focus on our most competitive assets, consisting of largely open-pit and more mechanised operations, which will result in higher margin production, a smaller and more highly skilled workforce, safer operations and a less complex organisation.
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By GlobalData“As a result, our core operations stand to benefit from dedicated management attention and technical expertise, as well as our disciplined capital allocation model.”
The upfront divestment proceeds of ZAR1.5bn ($110m) received from this deal will strengthen Anglo American Platinum’s financial stability.
According to the deal, Sibanye will also pay minimum deferred proceeds of ZAR3bn in nominal terms, to be earned through a 35% share of the distributable free cash flows generated by the Rustenburg Operations on an annual basis for a period of six years, beginning from 1 January next year.
Anglo American Platinum has also entered sale and toll treatment of concentrate agreement with Sibanye.
Sibanye will sell all concentrate produced by the Rustenburg Operations to Anglo American Platinum until 31 December 2018 based on pre-agreed commercial terms. After this, for a period of up to eight years starting 1 January 2019, Sibanye will enter a toll treatment arrangement where Anglo American Platinum will undertake the smelting and refining activities in respect of the Rustenburg Operations on pre-agreed commercial terms.
The charge payable by Sibanye under the toll treatment arrangement will reflect smelting and refining costs, as well as economic return on the proportional share of current capital base that Anglo American Platinum has invested in its processing assets.
