Sibanye-Stillwater faces compensation claim for dropping billion-dollar Brazil deal

INVESTMENT firm Appian Capital Advisory has served Sibanye-Stillwater with a notice of claim seeking compensation for the South African miner’s termination of a planned billion-dollar acquisition of two mines in Brazil.

London-based Appian, advising two affiliated private equity funds which own the Brazilian mines, said the transaction was worth over $1.2 billion (R18.4bn) and called Sibanye’s failure to close on it “unlawful”.

Sibanye-Stillwater declined to comment. The company abandoned the deal on January 24, just three months after it had been announced, citing geotechnical instability at the Santa Rita nickel mine which it said would have had a material and adverse impact on operations there.

Appian yesterday said it believed Sibanye’s characterisation was false, and the instability was a crack in the mine’s pit wall, which has had no impact on the open-pit mine life.

“Appian intends to rigorously enforce its legal rights and pursue Sibanye-Stillwater for all damages and losses incurred,” the firm said.

Sibanye-Stillwater is in a closed period ahead of results.

It had planned to report 2021 operating and financial results on February 17 but delayed the release to today, saying completion was taking longer than planned.

The acquisition of the Santa Rita nickel mine and Serrote copper mine was meant to bolster Sibanye’s battery metals portfolio as the miner seeks to diversify away from platinum and gold.

Meanwhile, in another development, Solidarity yesterday said it had accepted miner Sibanye-Stillwater’s final wage offer and withdrawn from any further organised labour action, splitting from a group of unions negotiating together for the first time.

Solidarity, along with three other unions, had been negotiating since December over wages at Sibanye’s South African gold mines but said it did not take part in a union strike vote on Tuesday after deciding to accept the offer.

Under Sibanye’s final offer – the sixth since talks began – miners, artisans and officials would receive a 5 percent pay increase each year and “unskilled and semi-skilled” employees would be given an increase of R800 a month for each of the three years, including a R100 a month increase in allowances.

Solidarity said that an “overwhelming” majority of its members accepted the final offer in a confidential vote.

“We are satisfied with the offer and are happy that we could negotiate this increase for our members,” Riaan Visser, the deputy general secretary at Solidarity, said.

The remaining unions in the coalition – the Association of Mineworkers and Construction Union, National Union of Mineworkers and Uasa – have yet to announce the result of Tuesday’s vote on whether to strike.

A Sibanye spokesperson declined to comment on Solidarity’s decision, saying the company is awaiting the outcome of the ballot process.

Sibanye’s share price in later afternoon trade was up 3.39 percent at R77.54 as mining firms on the JSE ride the bullish gold price on investor unease due to Russia’s invasion of Ukraine.

BUSINESS REPORT