Mr Keating Boosendal article NEW30 Apr 2013 12:31
http://www.miningmx.com/page/news/platinum_group_metals/1592701-Aquarius-R125bn-Booysendal-deal-on-the-brink
AQUARIUS Platinum's ambitions of extending the resources of its Kroondal mine seem set to founder after the company said its efforts to secure approval from the South African government for the deal had failed.
Aquarius Platinum has until April 30 to win approval for a transaction in which it would buy the Booysendal South property from Northam Platinum. The deal carried a value of $135m and required the support of the mineral resources department (DMR).
"Despite our significant efforts with the DMR, we have no visibility as to what their position is or whether or not the approval will be granted," said Jean Nel, CEO of Aquarius Platinum in an e-mailed response to questions posed by Miningmx. "We will put out an appropriate release as soon as is practical," he added.
Aquarius Platinum said in its third quarter production results published today that it remained in contact with Northam Platinum and the DMR. "In the absence of the necessary approval being granted on or before 30 April 2013, the agreement will lapse," the company said.
Northam Platinum declined to comment. It is understood, however, that it expects to hear from Aquarius Platinum following the former's board meeting. It was possible that the transaction could be extended.
Analysts, however, believe the failure of the deal was not a disaster for Aquarius Platinum which, on the evidence of its third quarter results, is showing signs of a recovery following adoption of an owner-operator model on its mines.
In fact, delaying the deal might be in Aquarius Platinum's favour as it would be able to renegotiate the terms and timing of the deal, especially as the company also faces the prospect of funding a R2.79bn ($300m) convertible bond (although in theory that could also be rolled over for a further four year period).
In its present form, it was likely Aquarius Platinum would have to turn to a capital raising exercise as it would not be able to fund the transaction from cash flows. An adjustment in timing would assist the company's recovery.
Booysendal South lies adjacent to Aquarius Platinum's Kroondal mine and contains an estimated 31 million ounces of platinum group metals in both UG2 and Merensky reef formations. Incredibly, the deal was first announced nearly two years ago, on May 4 2011, in which time government approval has been pending.
"I don't know of any mining company that has received a Section 11 (change in ownership) from the DMR in the last two years," one mining industry source said.
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