Sibanye plunges after big legal hit

Sibanye Stillwater unlawfully terminated a $1 billion deal for two Brazilian mines with private equity firm Appian Capital Advisory, a London judge ruled.

Appian Capital, which invested in the two mines in Brazil, sued the South African mining and metal multinational for backing out of a 2021 agreement to purchase the mines following a geotechnical event at a mine.

The judge said in the ruling published Thursday that Sibanye is liable to compensate Appian. 

Appian however, failed to prove Sibanye was guilty of willful misconduct in terminating the deal, the court said.

Appian could have sold the mines to another purchaser after Sibanye “terminated the deal and therefore cannot recover any loss it has suffered” Sibanye said in a statement.

Shares in Johannesburg-based Sibanye fell as much as 8.9% after the ruling.

The case relates to Santa Rita Mine, a nickel mine, and Serrote Mine, a copper and gold mine, in Brazil. Sibanye-Stillwater was originally gold-focused, but from 2019 adopted a strategy to increase its exposure to metals which are needed for low carbon technologies, including batteries, according to the ruling.

In October 2021, Sibanye offered a combined price of $1 billion for the two mines. After the geotechnical event at one of the mines, Sibanye terminated the deal in January of the following year.

Appian said it will seek to recover the losses in full along with the “significant interest” accrued since January 2022, it said in a statement after the judgment.

The UK court will hear arguments on how much damages are owed in November 2025.

Previously Appian said that a localized fracture at Santa Rita wasn’t a “material adverse event” and occurs in the normal course of open pit operations.

The geotechnical event involving a dislocation of part of the slope of a mine, did not lead any injury to life or equipment and did not have adverse regulatory consequences, according to the ruling. The actual cost of the incident and its remediation was about $20 million.

“I am not in any doubt that that was not material,” the judge said, comparing the cost with the size of the deal.