Bushveld Minerals to help change ownership of Vametco partner

Bushveld Minerals said it had agreed to help change the ownership of a Black Economic Empowerment (BEE) partner as part of its planned acquisition of Vametco.

Bushveld Minerals has agreed to support Jaxson 640's acquisition of a 21.2% controlling interest in the BEE stake in Vametco from from a consortium led by Avacap.

This will take place alongside Bushveld Vametco’s proposed acquisition of a 78.8% stake in Strategic Minerals from the Evraz Group, which is currently underway.

The South African government launched the BEE programme to address the inequalities of apartheid by aiding certain previously disadvantaged communities in an effort to bring them into the mainstream economy.

The price for the stake is about ZAR 47m (£2.87m), which comprises of a cash payment of about ZAR 7.4m to the Avacap consortium and the assumption of all the debt financing of about ZAR 39.5m by the BEE shareholders.

The deal is subject to regulatory consent from South Africa’s Department of Mineral Resources.

Chief executive Fortune Mojapelo said: "Jaxson 640 will also include a shareholding for a trust focused on empowering historically disadvantaged South African women and youth in the communities that Vametco operates, with particular emphasis on education, entrepreneurship and enterprise development."

“The involvement of the communities through a community trust presents an opportunity to pro-actively ensure that the economic interest in Vametco dedicated to local communities can be applied in a proactive and strategic manner that delivers measurable and sustainable economic benefits for the communities concerned."

Shares in Bushveld Minerals were up 1.43% to 2.84p at 1308 GMT.