Platinum Ripe for Mergers FT25 Feb 2013 09:09
Platinum sector consolidation is expected this year as reduced demand and unit cost increases have left many producers in unsustainable positions, sector sources told dealReporter. But strong long-term fundamentals mean expected IPOs and strategic investments will continue, they added.
Short-term M&A activity is likely to involve Xstrata’s [XTA LN] platinum operations and opportunistic bids from miners such as African Rainbow Minerals [ARI SJ, said industry sources. Aquarius [AQP LN] and Northam [NHM SJ] are both potential targets, while an IPO of Sedebilo and secondary listing of Robert Friedland’s Ivanplats [IVP CN] are on the cards, they said
Schmidt wouldn’t be drawn on targets but Aquarius and Northam are probably on his watchlist, said a sector banker. Both companies have operations on the Eastern Limb (Aquarius also has extensive operations on the Western Limb).
Aquarius’s diversified shareholder base would be unlikely to stand in the way of any takeover offer, noted a second analyst. Meanwhile, Northam’s second biggest shareholder ENRC [ENRC LN] is looking to sell its 13.52% stake and this may encourage third parties, he added. Aquarius, meanwhile, is still awaiting approval from South Africa’s Department of Mineral Resources for its acquisition of Northam’s Booysendal South mine, a transaction announced last May.
http://www.ft.com/cms/s/2/d61f9b0e-7d22-11e2-8bd7-00144feabdc0.html#axzz2LtrfE1nN