Royal Bafokeng Holdings (RBH) has accepted an offer to sell up to 33 percent of its equity position in Royal Bafokeng Platinum (RBPlat) to Northam Platinum Holdings.
RBH is an African community investment holding that operates under the Royal Bafokeng Nation Development Trust (RBNDT), its sole shareholder. It currently holds a 36.1-percent stake in RBPlat, a South Africa-based mid-tier platinum group metals producer.
The holding is entrusted with responsibility to preserve and create intergenerational wealth for the Royal Bafokeng Nation (RBN) under the leadership of Albertinah Kekana, who is the holding’s CEO.
The deal, which valued RBH’s 33.3-percent stake in RBPlat at R17.2 billion ($1.14 billion), will see Northam become the largest shareholder in the holding’s platinum business through the acquisition of an initial 32.8-percent stake, with the hope to raise that stake up to 33.3 percent.
In line with resolutions made at a meeting of the RBNDT board and the RBN Supreme Council on Nov. 8, the unsolicited offer from Northam maximizes value for the nation.
The offer states that the proceeds from the sale will be realized through a combination of a cash consideration of R8.6 billion ($568.5 million) and a share consideration resulting in RBH holding an 8.7-percent stake in Northam.
Upon the conclusion of the transaction, RBH will continue to be a long-term platinum group metals investor through its various holdings, which include the 2.8-percent stake that it will own directly in RBPlat and the 8.7-percent stake in Northam that it holds indirectly.
In a statement, Kekena said the holding recognized Northam’s success in implementing its long-term growth and diversification strategy and is pleased to be a strategic shareholder in Northam.
She added that Northam will partner with RBH and the RBN through the transaction to deliver a number of high-impact community initiatives for the RBN and the region as a whole, which include employees and communities associated with RBPlat.
“We look forward to supporting Northam’s board and management and to also work closely with Northam with regards to all matters affecting the RBN,” she said.