The main beneficiary of gold miner Pan African Resources’ decision to pay a 30% higher dividend for the year to June will be the company itself.Pan African passed the interim dividend to conserve cash for investment opportunities. As a final dividend, it is proposing to pay 15.4c/share, up from 11.5c/share in 2015, which will cost a record R300m.After Shanduka Group and Pembani merged in 2015, Pan African bought out the stakes in Shanduka Gold (now PAR Gold) held by Standard Bank and Jadeite for R547m to protect its black empowerment status.As a result, it holds 49.9% of PAR Gold, which in turn owns 22.46% of Pan African shares. Because of the structure of the transaction, which was funded with a vendor loan, the attributable dividend to Pan African is R65.7m.The group’s second-biggest shareholder after PAR Gold is Allan Gray Investment Management, with 19.62%.Like many other mining companies which used to have progressive dividend policies and found them inappropriate in a cyclical...
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