Shareholders of both precious metals miner Sibanye-Stillwater (JSE:SGL) (NYSE:SBGL) and struggling rival Lonmin (LON:LMI) approved on Tuesday the planned merger of the companies, effectively creating the world's largest platinum producer and the second-biggest palladium miner.
Sibanye-Stillwater said that 87% of its shareholders backed the all-share offer, which it revised down in April, valuing the smaller miner at 226 million pounds ($286 million), 60 million pounds less than initially offered.
Later in the day, the majority of Lonmin's shareholders rubber-stamped the deal.
The deal establishes the Sibanye-Stillwater Group as the world's largest platinum producer and the second-biggest palladium miner"We are pleased to have received the overwhelming support of both sets of shareholders for the Lonmin transaction," Sibanye-Stillwater CEO Neal Froneman said in a separate statement.
South Africa's Competition Appeal Court had cleared the way for the acquisition earlier this month, stopping Lonmin's main mining union's attempt to block the takeover or have it re-examined. The Association of Mineworkers and Construction Union's (AMCU) move was an effort to avoid some of inevitable layoffs, originally estimated at 3,000, that will take place after the merger.
The takeover is seen as a rescue deal for Lonmin, severely hit by weak platinum prices during the 2016-2017 downturn, costs related to the strengthening rand, a large labour force and expensive deep-level mines.
For Sibanye, it is just one more of many deals struck by chief executive officer Neal Froneman who has transformed the gold miner by expanding its operations into the platinum-group metals sector.