Platinum Group Metals sells Maseve Mine

Platinum Group Metals announces plans to sell Maseve Investments to Royal Bafokeng Platinum (RBPlat). The transaction is valued at about USD74-million.

Image credit: PGM

Maseve is the operating and holding company for the Maseve Mine, located on the Western Limb of the Bushveld Complex near Rustenburg, South Africa. The company owns an indirect 82.9% equity interest in Maseve. The cash proceeds of the sale will be used to repay debt.

The Maseve sale transaction will happen in two stages:

  • RBPlat is to pay Maseve USD58-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. The payment to be received by Maseve will be remitted to the Company's South African subsidiary, Platinum Group Metals (PTM RSA).
  • RBPlat is to pay PTM RSA USD7-million in common shares of RBPlat plus approximately USD4-million in cash to acquire PTM RSA's remaining loans due from Maseve.

PTM's proceeds from the sale of Maseve and the Maseve Mine are to be repaid to secured lenders who are collectively owed about USD89-million in principal and accrued interest. Negotiations to settle or restructure the balance of amounts due and a termination fee are ongoing. 

RBPlat will be granted a management contract for the Maseve Mine and for carrying out care and maintenance services during the period between the date of grant of the Competition Approval and the date of Ministerial Consent. The company will be responsible for 50% of care and maintenance costs after Competition Approval until the earlier of the date of Ministerial Consent and the date upon which RBPlat uses the surface infrastructure of the Maseve Mine for its own purposes. 

“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,” says Michael Jones, president and chief executive officer of Platinum Group. He adds that because RBPlat owned and operated Bafokeng Rasimone Platinum Mine, it was logical for the platinum mining company to buy Maseve Mine. 

It is estimated that the company will require about USD10-million in additional working capital to provide for its share of Maseve Mine costs until the Plant Sale Transaction is closed. The company is working with its strategic advisors and current secured lenders on debt, equity and other strategic transactions for this financing. 

“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,” concludes Jones. 



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