Anglo American Platinum has been approached by a group of investors backed by the Industrial Development Corporation (IDC) about buying Bokoni mine in Limpopo, moving the miner a step closer to getting rid of all unprofitable assets to focus on mechanised mines.
Amplats, a division of Anglo American, has been pivoting away from labour-intensive shafts that have defined SA mining for years to more mechanised operations following an unprecedented five-month strike in 2014 that further undermined its commercial viability.
The Ayana Baroka group, a consortium led by Baroka Platinum, a firm owned by the community of Baroka ba Nkwana, submitted an expression of interest in the mine last week, saying it intends to bid for the mothballed mine, according to documents obtained by Business Day.
A letter of commitment from the IDC said the state-owned development finance institution would consider funding the
deal if the consortium is selected as the preferred bidder, the document showed.
The IDC confirmed the authenticity of the letter that accompanied Ayana Baroka’s interest in the mine, which produced more than 80,000 ounces of platinum group metals in 2016, the year before it was put under care and maintenance.
The mine’s contributions to Amplats’s annual output of more than 4-million ounces in 2019 is small, but unloading it would almost complete the divestment programme launched by former CEO Chris Griffith.
Amplats did not confirm or deny if it had received the expression of interest from the Baroka-led consortium but said the process to sell its interest in the business had started with a number of parties having already shown interest.
"A number of parties have expressed an interest in the asset and are included in the formal sale process, which has commenced and is at an early stage.
"Our aim is to find a credible buyer with the ability to fund, restart and operate Bokoni safely and responsibly post-disposal," Amplats’s spokesperson Jana Marais said.
For Baroka Platinum, which currently relies on royalty payments, the proposed deal would give it its first production asset and allow it to funnel more money from the Bokoni mine to fulfil its stated mandate of building schools, clinics and roads for the Baroka ba Nkwana community’s 90,000 people.
The mine is located on land owned by the Baroka ba Nkwana, which spans more than 20,000ha in the Eastern Bushveld, a mining area containing major deposits of platinum, chromium and vanadium.
The consortium, which according to the documents is the only one with the backing of the community, said in the letters the deal would help restart Bokoni, whose closure has had an effect on surrounding communities.
"This is a unique turnaround opportunity to establish the viability of the mine," one of the deal documents said.
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