#EUA – why the silence ?

Why I think it means multiple offers are being considered

So we know we have a credible party that the Board is progressing with (12.5.21)

This also means that every single other company that was interested knew they were no longer in pole position and had to withdraw or come back with a better proposal. I’ve said this before it isn’t much more than a simple statement of fact.

You don’t want to lose the credible party but equally you don’t want to lose better proposals if they did arrive.

The latest RNS about West Kytlim was a little hint towards this being the case – strategic options on the table.

So how do you handle it ? Two options as I see it.

1. Announce you have multiple interested parties again and update shareholders (what I wanted to see as proof of my theory but hasn’t happened)

2. Stay silent

If you announce it, does the credible party get the hump and lose interest feeling they are being played ?

If you stay silent shareholders bear the brunt but it keeps the process alive inside the loop. Perhaps you do what you can to appease but essentially it is focus on the deal. All forgiven when it concludes etc. I believe the line about options was the hint.

This sounds to me like where we find ourselves. If you trust the Board then it’s easier to believe in a decent outcome, they have delivered so far in abundance.

The amount of negativity and worrying springing up is two fold. Genuine worry I get it, investing is never a smooth path. The larger holders remain intact. If the former adviser hadn’t had his cash call we would be higher priced, Churakov did buy back most of his shares though. Obviously the Board haven’t sold any shares throughout this process

But for those attacking and spreading false rumours, I get it as well. Enjoy your moment, it won’t last forever. One RNS will spoil your fun permanently.

Sometimes silence is golden, well platinum…

#EUA – Sibanye Updates

Sibanye Stillwater have issued a few updates lately that are worth noting :

1. Increase in profits H1 2021 to $1.7bn (up 162%)


Generating profit generates options, with debt finance at record lows they now have the firepower to make an acquisition larger than Stillwater in 2017

2. Sibanye-Stillwater progresses battery metals strategy with the exclusive put option to acquire Eramet’s Sandouville nickel processing facilities


“The Sandouville facility is situated in the industrial heart of Europe at Le Havre, France’s second largest industrial port, with strategic access to extensive logistical infrastructure including shipping, rail and key motorways, supporting any future supply into the European end user markets. The current Sandouville facilities include a hydrometallurgical nickel refinery with a production capacity of 12,000 tonnes per annum of high-purity nickel metal, 4,000 tonnes per annum of high-purity nickel salts and solutions and around 600 tonnes per annum of cobalt chloride. For more information on the transaction, please refer to https://www.sibanyestillwater.com/news-investors/news/transactions/sandouville/.
Investment rationale
The transaction is the second step in Sibanye-Stillwater’s battery metals strategy, building on the investment in the Keliber lithium hydroxide project, in partnership with the State of Finland and the Finnish Minerals Group, announced in February 2021. The Sandouville site is a polyvalent facility which is already zoned for heavy industrial purposes. The site is scaleable for nickel, cobalt and lithium battery grade products, and will enable Sibanye-Stillwater to further advance its battery metals strategy and recycling activities.”


So why are these relevant ? Well for one it shows the increasing firepower and appetite to diversify away from South African assets. Stillwater acquisition showed Froneman is prepared to be brave and make big decisions and now they are building a battery metals business – but a nickel processing plant needs some nickel…

Also, they call it their ‘second step’ – not the final step. Crucial signal of more activity to follow as they build a European presence. If for example they shipped nickel from Murmansk area, they would not be reliant on NorNickel processing plant in Monchegorsk.

I think it was a huge clue as to the scale of Froneman’s ambitions and intrigued to see where it goes next. Very much on my shortlist of companies in talks with Eurasia, could even be the preferred bidder as announced on May 12th.