Impala Platinum says it has concluded a framework agreement with the department of trade, industry & competition (DTIC) related to its proposed takeover of Royal Bafokeng Platinum.
Competition Tribunal approval is the last major condition holding back the takeover, and earlier in August, an RBPlat attorney accused the department of “gross failure” after it failed to submit feedback timeously.
The framework agreement, which is subject to Implats getting a controlling stake, covers issues of employment, support for SMMEs and localisation, the precious metals group said in a statement.
The agreement is a “further positive endorsement by key stakeholders of the proposed transaction and the significant public interest benefits that are expected to flow from it,” the statement reads.
Implats wants to buy its neighbour to extend the life of its Rustenburg operation as its shafts are ageing and becoming too costly to mine, but it has faced delays during competition proceedings.
The merger finalisation has been delayed by rival Northam’s bid to become involved and give evidence on the effect of such a deal. This was permitted, but it has launched an appeal at the Competition Appeal Court (CAC) as it wishes to give more detailed evidence than was originally permitted.
The tribunal can only hear Northam’s evidence once the CAC has decided on what areas it can give evidence on.
In the August hearing before the tribunal that must approve the merger, an advocate for the DTIC asked for a postponement after the government had not submitted its feedback on time, despite promising to do so by the end of May.
The department feedback was only provided the night before the tribunal hearing with some feedback arriving on the same morning as the hearing took place on August 1.
While RBPlat’s advocate pleaded that a postponement not be given due to the time sensitivity of deal, the tribunal allowed a two-week postponement. Now that government and Implats have concluded talks, the tribunal only has to wait for the CAC to rule on Northam’s appeal and then hear its evidence.
The Competition Commission has recommended the merger, amid conditions that include a moratorium on merger-related job cuts for five years, the creation of a supplier development fund and the continued existence of worker ownership schemes at both mines.
In early trade on Wednesday, Implat’s shares were up 3.86% to R185.99, putting them on track for their best day in almost two weeks, while the JSE’s precious metals index had gained 1.71%.
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