Implats a step closer to Royal Bafokeng takeover

Impala Platinum (Implats) has bought a further 8.5-million shares in takeover target Royal Bafokeng Platinum (RBPlat), making its intention clear to take control of the group.

Implats said on Thursday it had acquired further shares in RBPlat, taking its stake to just under 45%.

“Save as may be prohibited under the Companies Act or the Takeover Regulations, Implats may be acquiring further RBPlat shares after the date of this announcement while the offer remains open and, if required under the Companies Act or the Takeover Regulations, will make further disclosures and announcements in that regard,” the company said in a statement.

Northam Platinum announced a fortnight ago it had immediately withdrawn its takeover bid for RBPlat, opening the door for Implats to lay its hands on the mid-tier platinum miner envied for its large, shallow and high-quality platinum group metals (PGMs).

Northam pulled the plug on RBPlat because PGM basket prices have fallen significantly since its R17bn cash offer was made in December. 

Prices of PGMs, primarily used to cut harmful emissions in internal combustion engines and jewellery, have dropped off their historic highs reached in 2021 when the world was in the clutches of the Covid-19 pandemic, which triggered global supply-chain issues.

The global economic outlook has also become uncertain, potentially affecting the demand outlook. The rhodium closing price has fallen and remained below $9,000/oz for 12 straight days, Northam said in a statement. Its peak was close to $30,000 at the height of the pandemic.

Implats is seeking to gain majority control in its crosstown rival after accumulating its shares over a period of just more than a year, while Northam holds nearly 35% with the option to increase it to 38%.

The Public Investment Corporation is the potential kingmaker with a shareholding of 9.9%.

The protracted battle between the two parties has taken its toll on the stakeholders involved, with RBPlat CEO Steve Phiri saying in February that the company’s ability to pursue growth plans was limited while some personnel opted to leave due to uncertainty.

“The uncertainty caused by the delay in finalising the corporate action is what has become a key risk to managing our people, their morale and retention,” Phiri said at the time.

“We are unable to formulate a long-term strategy and implement aspects of our current strategy, which includes growth. Our capital allocation abilities are constrained.”

RBPlat this week extended the fixed-term contracts of Phiri and  group COO Neil Carr by an additional six months pending the finalisation of the proposed takeover bid by Implats.

In a statement on Tuesday after the market close, RBPlat said the two executives would remain with the group until October to ensure a smooth transition as and when the proposed deal is consummated.

“As a consequence of the extension, the executives’ entitlement to the cash bonus ... has been deferred and remains subject to the condition that they remain in the company’s employ until the expiry date and that they satisfy the existing performance conditions which pertain to the corporate action,” RBPlat said.

Late in March, Implats extended its bid by another month while it awaited a takeover compliance certificate from the mergers & acquisition watchdog.

khumalok@businesslive.co.za