Implats ups the ante with R43 billion offer in bidding war for RBPlat
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IMPALA Platinum Holdings (Implats) yesterday made Royal Bafokeng Platinum (RBPlat) shareholders a staggering R43 billion offer to buy out a majority stake in the company as the bidding war with rival Northam Platinum heats up.
RBPlats soared by more than 16 percent on the JSE while Implats was 6 percent stronger after the transaction was announced.
Implats said on a 100 percent basis the total transaction value was R43bn, however, on a 65 percent basis, which would exclude the shares held by Northam, the transaction value is in the region of R28bn.
Implats last week bought 24.5 percent of RBPlat shares constituting more than 70 million shares from institutional shareholders including Abax Investments, Allan Gray, Coronation Asset Management, M&G Investment Management and Niney One SA.
“The overwhelming response and support of these shareholders is particularly validating of our confidence in the value proposition this offer provides for both RBPlat and Implats shareholders,” chief executive Nico Muller said.
Implats has offered the remaining shareholders R150 per RBPlat share comprising a R90 cash component and 0.300 ordinary shares in Implats. Implats said a condition for the offer was to acquire 50 plus one percent shareholding in RBPlat.
Muller said Implats would not like to operate as a minority shareholder. “Our ambition is to be in a controlling position and that has been clearly spelt out in the offer, failing that the company will evaluate whether or not to proceed with the offer,” said Muller.
Muller said the question of whether RPlat would de-list would be a consequence based on the take up of the offer.
“We are not saying it will remain listed, we are saying it will be an outcome based on the take up of the offer,” Muller said.
Implats' offer comes three weeks after Northam acquired 32.8 percent in RBPlat from Royal Bafokeng Holdings (RBH) for R17bn, representing R180.50 a RBPlat share.
Muller said to dispel any uncertainty other than the Implats offer, there were no known offers on the table.
“The offer made by Northam Platinum two weeks ago was a bilateral agreement between the two parties and therefore did not constitute an offer to all shareholders,” he said.
Muller said it would have been ideal to acquire 100 percent shares in RBPlat.
“We do believe it is important for us to get a controlling stake, and that is 50 percent plus one but we do not believe it is entirely necessary for us to migrate to 100 percent.
“It is unlikely that Northam will tender into the offer as they have paid R180 a share. We believe that even at the lower shareholder percentage, we will have a significant influence,” said Muller.
He said the fact that Northam was a shareholder was advantageous. “It means there is a partner with a performance track record and a partner that will be able to fund their way in the business, and critically important one of the fundamental benefits to the Northam RBH transaction is the significant commitment to socio-economic projects in the communities,” said Muller, adding that Implats would be in a position to ensure the commitments are executed.
The group said the transaction represented a premium of 23 percent to RBPlat's closing share price of R121.92 as of Wednesday last week.
Muller said the transaction was fully funded. “It will be settled through existing cash reserves and the issue of up to 57 million new Implats shares,”he said.
Commenting on the transaction, Anchor Capital investment analyst Seleho Tsatsi said it looked like there was a bidding war of some sort on our hands for RBPlats.
He said Implats has acquired just under 25 percent of RBPlats. “It acquired the stakes through institutional shareholders of RBPlats. Northam owns just under a third of RBPlats.
“At the moment, Implats' offer to acquire the remaining shares it does not own of RBPlats is the only offer on the table for RBPlats. Given Northam's interest, however, it does not seem likely to be the last,” Tsatsi said.
BUSINESS REPORT ONLINE