Platinum Group Metals has entered into a term sheet to sell Maseve Investments 11 Pty Ltd to Royal Bafokeng Platinum Ltd (RBPlat) in a transaction valued at approximately US$74 million. Maseve holds the Maseve PGM Mine on the Western Limb of the Bushveld Complex near Rustenburg, South Africa.
Platinum Group, which owns an indirect 82.9% equity interest in Maseve, will receive US$62 million in cash and US$12 million in RBPlat common shares. It says the cash proceeds of the sale will be used to repay debt.
Looking forward, the company plans to focus on its large-scale Waterberg project, a palladium dominant development asset where the majority of the company's mineral reserves and resources are located.
RBPlat is to pay Maseve US$58 million in cash to acquire the concentrator plant and certain surface assets of the Maseve Mine, including an appropriate allocation for power and water. Maseve will retain ownership of the mining rights, power and water rights as well as certain surface rights and improvements.
Platinum Group’s president and CEO R Michael Jones said, “The sale of Maseve will allow Platinum Group to settle a substantial portion of its outstanding debt and focus on the advancement of its large-scale Waterberg Project. We do believe we have settled upon terms which will benefit both companies and all stakeholders.
“RBPlat owns and operates the adjoining Bafokeng Rasimone Platinum Mine and is the logical buyer for the Maseve Mine. The future integration of the Maseve Mine into RBPlat’s operations is expected to bring benefits to local communities, both directly in terms of job creation and corporate social investment, and indirectly through the associated benefits of economic activity in the region."
Platinum Group’s proceeds from the sale are to be repaid to secured lenders who are collectively owed approximately US$89 million in principal and accrued interest. Negotiations to settle or restructure the balance of amounts due and a termination fee are ongoing.