Pan African selling Phoenix Platinum to Sylvania

Pan African Resources and Sylvania concluded an agreement, the two companies announced on Monday, whereby Pan African will dispose of all its shares and loan accounts in its wholly-owned subsidiary Phoenix Platinum to Sylvania, for total cash consideration of ZAR 89m (£5.18m).

The AIM-traded companies said the transaction would provide Pan African with an opportunity to meet a number of strategic objectives, including the ability to focus on core assets and value accretive growth opportunities.

“The transaction will enable [the] Pan African management to focus on the group’s existing gold operations, the construction of the Elikhulu project and other organic and acquisitive growth opportunities,” Pan African’s board said in a statement.

It said it would also improve its financial position, with the cash proceeds of ZAR 89m - payable on transaction closure - set to “further strengthen” the group’s financial position and supplement its existing cash resources and debt facilities.

The Transaction remained conditional on the conclusion of a confirmatory due diligence and other suspensive conditions customary for a transaction of such nature.

Pan African said the transaction was expected to be finalised within a 90-day timeframe.

“The disposal of Phoenix Platinum, which for some time has been non-core to Pan African, enables us to further strengthen our financial position and to focus on our large gold operations and the construction of the Elikhulu project,” said Pan African chief executive Cobus Loots.