Northam raises stake in Zambezi Platinum preference shares
Northam Platinum has bought additional listed Zambezi Platinum preference shares that it issued in a R4bn empowerment transaction in 2015 to up its shareholding to nearly a quarter.
Northam CEO Paul Dunne has repeatedly said the company is unlikely to pay dividends, preferring to buy back the preference shares with excess cash, thus reducing its exposure to a complex instrument when they are redeemed in 2025.
The JSE-listed preference shares, due for redemption in cash an/or shares in May 2025, attract dividends equal to the prime lending rate in SA plus 3.5% calculated on a daily basis and compound annually.
In its interim results, Northam noted the Zambezi preference shares showed up as a R10bn liability, while dividends paid towards the shares amounted to R612m.
On Friday, Northam said it had paid the state pension fund manager R997.5m to buy 13.3-million of these preference shares on Friday at R75 each.
Northam now owns 36.7-million preference shares, lifting its holding to 22.94%.