Takeover battle worries Royal Bafokeng

Royal Bafokeng Platinum said a 16-month-long fight by two rival South African miners to gain control of the company risks the future of its operations.

The takeover battle between Impala Platinum and Northam Platinum, which started in November 2021, has resulted in a “difficult operating environment”, RBPlat said in a statement Wednesday.

While Impala is its biggest shareholder with a 40.71% stake, its pathway to gaining control has been frustrated by Northam, which holds almost 35%.

RBPlat said it’s becoming harder to retain key personnel and keep morale high as the contest threatens its growth strategy.

It has engaged Chief Executive Officer Steve Phiri and Chief Operating Officer Neil Carr to extend their stay at the miner, after the executives last year delayed their retirement because of the takeover battle.

“The current delay in finalizing the corporate action renders us unable to develop a long-term strategy because of the uncertainty that prevails in the minds of the various stakeholders who are core to our business,” RBPlat said in an emailed response to questions.

“This uncertainty has a significant impact on decision-making, thereby frustrating any meaningful implementation of our strategy.”

RBPlat’s low-cost mechanized assets are key to maintaining the profitability of Impala’s adjacent Rustenburg operations.

For Northam, purchasing RBPlat would help close the gap between the country’s top-tier producers. Northam topped Impala’s earlier bid by 15% late last year, but its offer is yet to be detailed in a circular.

RBPlat urged Impala and Northam to “aspire toward a speedy and prudent conclusion of the ongoing corporate action in order to release the company from uncertainty and enable it to deliver value to all its stakeholders.”

The miner said operational challenges at its Styldrift mine weighed on the output of platinum-group metals last year. Profit before some one-time items, known as headline earnings, slumped 46% to R3.5 billion in 2022.

RBPlat fell 1.1% to R144.47 a share as of 12:43 p.m. in Johannesburg, trading about 16% below Northam’s November offer.