January 24, 2018

Sibanye Gold secures $2.65 billion for Stillwater acquisition

Sibanye Gold’s acquisition of Stillwater Mining Company, the only US miner of platinum and palladium, can be described as “almost done”, after the South African company revealed on Monday that it had secured the required $2.65 billion finance.

The diversified mining company closed the syndication of the bridging loan underwritten by Citi and HSBC who will also act as mandated lead arrangers and book runners.

The loan facilities were oversubscribed by more than $1 billion and divided into three tranches.

The first tranche was a $750 million bridge-to-equity component which will be repaid following a planned rights issue.

The other parts are a $300 million bridge-to-cash element and a $1.6 billion bridge to debt capital markets component.

Sibanye said in December it would pay $2.2 billion for Stillwater, which operates in Montana, extending its push into platinum mining.

The syndication attracted interest from banks acting as mandated lead arrangers including Barclays Bank PLC, Credit Suisse International and J.P. Morgan.

“It is pleasing to note the strong support for the transaction from a significant number of leading banks. This is a clear vote of confidence on the merits of the Transaction, following detailed due diligence by the syndicate banks,” said Sibanye chief executive officer, Neal Froneman.

The deal will make Sibanye the world’s third largest palladium producer and fourth largest platinum group metals miner.

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