CHROME AND PGM MINER THARISA MINERALS BEE SHAREHOLDERS TO BENEFIT FROM R388 MILLION EQUITY DEAL
IOL / 17 FEBRUARY 2022 - 14.33 / PHILIPPA LARKIN
“BEE shareholders will now benefit from the broader Tharisa group cash flow and dividend,” the JSE- and London-listed firm said, adding that Tharisa was offering 13.9 million new shares, the equivalent in exchange for the 26 percent of Tharisa Minerals it did not own.
This is good news for BEE shareholders as Tharisa started the year with a bang as it posted the best-ever quarterly production in South Africa during its first-quarter results, which ended on December 31.
Last month it reported its platinum group metals (PGM) production had risen 9.2 percent quarter-on-quarter to 47 700 ounces, while chrome production rose 1.5 percent to 401 800 ounces. The average PGM basket price during this period was at $2 394 an ounce. Tharisa chief executive Phoevos Pouroulis said: “We believe this agreement is a landmark transaction. It is truly empowering and in the spirit of the Minerals and Petroleum Resources Act. As public shareholders of Tharisa, they will benefit from diversification and the broader success of the company, receive dividends, and create financial flexibility.”
The mining firm currently owns 74 percent of Tharisa Minerals’ shares, with the BEE shareholders Thari Resources Proprietary owning 20 percent and The Tharisa Community Trust 6 percent. Tharisa Minerals’ principal asset is the long-life open pit Tharisa Mine, which produces both PGM and chrome in a mechanised, low-cost and energy efficient environment, with product beneficiation taking place on site. Tharisa said yesterday the deal was supportive of last year’s High Court ruling, clarifying the “once empowered, always empowered” position for mining companies. The court said the continuing consequences of previous black economic empowerment deals should be recognised.
This ruling had afforded Tharisa the opportunity to constitute Tharisa Minerals as a wholly owned subsidiary that continued to meet the requirements of the Mineral and Petroleum Resources Development Act and the Mining Charter, while allowing the BEE shareholders to benefit from the wider and diversified asset portfolio of Tharisa, it said. “The simplification of the corporate structure ensures that our BEE shareholders participate in regular dividend flows consistent with the company’s shareholders with a stated dividend policy of distributing at least 15 percent of consolidated net profit after tax, while benefiting from the company’s growth strategy, broadening their exposure to beyond the Tharisa Mine,” it said.
The deal would see 10.7 million shares issued to Thari Resources, resulting in ownership of 3.7 percent of Tharisa’s issued and outstanding shares, and 3.2 million shares issued to the Tharisa Community Trust, resulting in the ownership of 1.1 percent.
By 4pm Tharisa’s shares were up 1.05 percent, at R28.80.
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