Africa’s largest asset manager invests $494 million in Neal Froneman-led Sibanye

Feyisayo Ajayi -
Key Points
  • PIC invests R8.58 billion ($494 million) for a 15.048% stake in Sibanye-Stillwater, signaling confidence in mining recovery.
  • Sibanye-Stillwater, facing a 20% share price decline, seeks revitalization through PIC's investment, providing renewed optimism for its financial outlook.
  • As Africa's largest asset manager, PIC’s investment reflects a strategic focus on the mining sector, enhancing growth potential and sustainability.

Africa's largest asset manager, the Public Investment Corporation (PIC), has acquired a beneficial stake in Sibanye-Stillwater, a mining group led by South African magnate Neal Froneman.

The acquisition, announced on Oct. 2, highlights PIC's growing interest in the private mining sector as it seeks to navigate financial challenges within the industry.

The PIC's investment, totaling R8.58 billion ($494.03 million), secures a 15.048 percent beneficial stake in Sibanye-Stillwater, adhering to local regulatory requirements and aligning with the corporation's strategic focus on the mining industry.

PIC investment revives Sibanye-Stillwater outlook

Sibanye-Stillwater, despite being a top producer of platinum, palladium, and gold, has faced notable financial difficulties, including impairments and liabilities under the leadership of Neal Froneman that have significantly impacted its market value.

This year, the company has seen its share price decline by over 20 percent, resulting in a market capitalization of below $3.3 billion.

Neal Froneman, who has been pivotal in Sibanye-Stillwater's expansion, owns a 0.3 percent stake in the company.

Although recent stock declines have affected valuation, PIC's investment introduces a renewed sense of optimism for both Sibanye-Stillwater and South Africa’s mining sector.

PIC's investment signals mining sector recovery

Founded in 1911 and corporatized in 2005, the Public Investment Corporation (PIC) manages government workers' pensions and is the largest shareholder of Investec with a 15.5 percent stake valued at R5.88 billion ($339.68 million).

As Africa's largest asset manager, with R3 trillion ($173.27 billion) in assets under management, PIC's investment boosts confidence in Sibanye-Stillwater and the mining sector's growth potential.

This strategic move suggests a recovery path for Sibanye-Stillwater and marks a new era of partnerships and sustainability in mining.

Additionally, the company's compliance with regulatory requirements through filings with the Takeover Regulation Panel adds credibility to this significant deal.