Business Day (Johannesburg)
Charlotte Mathews
1 July 2009
Johannesburg — PLATINUM and chrome retreatment company Sylvania Resources, which has recently been on the acquisition trail, has itself become the target with a à 268m offer from Finnish group Ruuki to buy all its shares.
Sylvania is listed on the Australian Stock Exchange but operates only in SA, while Ruuki is listed on the Nasdaq OMX Helsinki.
In May, Ruuki agreed to buy 84,9% of Mogale Alloys for R2bn from its several shareholders, who include JSE-listed commodities trader Metmar . Ruuki told Bloomberg it was actively pursuing other platinum deals in SA and it has been speculated it could be one of the bidders for Braemore Resources. Braemore said last month it was in negotiations that could lead to a takeover offer.
Sylvania, which extracts platinum group metals from Samancor Chrome and Aquarius Platinum's tailings, has also been busy, recently announcing all-share offers for Great Australian Resources and SA Metals.
Ruuki's offer for Sylvania was not conditional on the success of those deals but it did depend on the closing of those offers, it said. Ruuki is offering one of its shares for every 1,81 Sylvania shares, based on Ruuki's share price of à2,24 and Sylvania's share price equivalent of £1,05 on 29 June.
The offer has been recommended by Sylvania's independent directors, excluding CEO Terry McConnachie, who is also a director of Ruuki. After the deal, current Ruuki CEO Alwyn Smit will continue in this role and McConnachie will become CE of Ruuki Minerals PGM.
Ruuki said the deal would create an integrated mine-to-metals platinum and ferrochrome group. It would be able to expand production by accessing previously uneconomic high-chrome, low-grade material in tailings dumps and apply new technology to its extraction.
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