On December 9, Stillwater Mining Co. announced it has entered into an agreement with Sibanye Gold Ltd. to acquire Stillwater for $18 per share in cash representing an aggregate enterprise value of $2.2 billion. The transaction price represents a 61% premium to Stillwater’s volume-weighted average share price over the 52 weeks prior to the announcement of the transaction, a 25% premium to its volume-weighted share price over the 30 trading days prior to the announcement and a 23% premium to its closing share price on December 8. Following a thorough review of Stillwater’s strategic opportunities, the company’s board of directors has unanimously approved the transaction.
Mick McMullen, CEO of Stillwater Mining Co., said, “This compelling all-cash transaction delivers immediate value to shareholders and appropriately recognizes the value of Stillwater’s high-grade and long-life assets and world-class metallurgical and PGM recycling complex, as well as Stillwater’s potential for brown field expansions through the development of our Blitz and Lower East Boulder projects.”
McMullen said Sibanye has indicated its commitment to maintaining and investing in Stillwater’s Montana operations and will look to leverage its best practices, industry leading mining expertise and proven ability to drive improvements and efficiencies while improving safety across their entire business.
Sibanye’s two largest shareholders, Gold One International Ltd. and Public Investment Corporation Ltd., which in aggregate represent 29% of Sibanye’s issued share capital, have confirmed their support of the transaction. The parties expect the closing to occur in the second quarter of 2017.
Sibanye has secured bridge financing of $2.7 billion provided by Citi and HSBC to fund the transaction consideration and repay certain existing indebtedness of Stillwater.
Stillwater Mining is the only U.S. miner of platinum group metals (PGMs) and the largest primary producer of PGMs outside of South Africa and the Russian Federation. The company is currently developing, extracting and processing PGMs from a geological formation in south-central Montana recognized as the J-M Reef. The company owns the Marathon PGM-copper deposit in Ontario, Canada, and the Altar porphyry copper-gold deposit located in the San Juan province of Argentina.