HARARE – Impala Platinum Holdings (Implats)’s subsidiary Zimplats yesterday unveiled its indigenisation plan by ceding a 51 percent stake worth $971 million to locals.
By signing an agreement or term sheet — outlining the implementation of its enhanced empowerment plan — with government yesterday, the local platinum miner complied with Zimbabwe’s indigenisation law.
Under the indigenisation deal, 31 percent was issued to National Indigenisation and Economic Empowerment Board (NIEEB)’s fund, 10 percent to employees and the other 10 percent was given to Ngezi-Zvimba Community Share Ownership Trust.
“This term sheet spells out in detail the purchase of the 51 percent shares by indigenous entities, as part of the laws of this country.
“This is undoubtedly the country’s biggest empowerment deal,” Terence Goodlace, Implats chief executive said.
“We hope the involvement of the locals will add an impetus to the company’s output and broaden profit margins,” Goodlace said.
The deal is expected to be complete by June 30, 2013.
It will be financed through a loan to the indigenous entities at a 10 percent annual interest rate.
This comes as an earlier indigenisation plan by Zimplats had been rejected by government.
Under Zimbabwe’s indigenisation law, endorsed four years back, foreign-owned firms with a net asset value of $500 000 plus must cede at least 51 percent shareholding to locals.
The Zimplats deal follows that of fellow platinum producer Mimosa, which sold off a 51 percent stake at $556 million.
Mimosa is jointly owned by Aquarius and Implats.
Zimplats, with a market value of approximately $1 billion, is 84 percent- owned by Implats — the world’s second-largest platinum producer after Anglo American.
Implats will retain a 49 percent interest in Zimplats.
Goodlace said the indigenous shareholders will appoint directors to Zimplats board.
The $971 million purchase price includes a previous payment from a deal between government and the miner in 2006 under which Zimplats released 36 percent of the company’s resource base, amounting to 51 million ounces of platinum, in return for empowerment credits.
“We are absolutely not going back on our stance, this is an execution of a board mandate, which we will not alter under any circumstance,” Goodlace said.