South Africa-based Impala Platinum has entered into an agreement to acquire outstanding shares in Canadian North American Palladium (NAP) for $758m.
NAP owns and operates Lac des Iles, which is located northwest of Thunder Bay, Ontario. It has shares in two exploration properties, the Sunday Lake project and the Shebandowan Joint Venture.
The transaction amount will be settled by paying in a combination of existing cash of $288m, cash raised through a metal prepayment of excess inventory of $120m and a loan of $350m.
Implats CEO Nico Muller said: “Implats has had an exploration presence in Canada for more than two decades and over the past three years we have developed a strong relationship with and understanding of NAP and its management team and operations.
“It is Implats’ view that the palladium market will remain in a structural deficit in the medium term, which should lend considerable support to stronger-for-longer pricing.”
The transaction would strengthen Implats’ portfolio
Implats said the transaction would reposition its portfolio and strengthen its competitive positioning in line with its stated strategy by acquiring a palladium-rich, operating asset in an established mining jurisdiction.
It is expected to help Implats in developing a competitive global portfolio of producing, processing and exploration assets.
The acquisition is also anticipated to diversify Implats’ production base geographically and operationally.
NAP president and CEO Jim Gallagher said: “This transaction delivers attractive value for our shareholders and reflects five years of hard work we have devoted to realise the potential of our assets.
“We have successfully established Lac des Iles as one of Canada’s largest, lowest-cost and safest underground mines, producing a metal that contributes to a cleaner global environment.”
The deal is subject to certain customary regulations.
In August, North American Palladium (NAP) had announced the acquisition of a 51% stake in the Sunday Lake Project, from Impala Platinum (Implats).
Located 25km north of Thunder Bay in Jacques Township, the Sunday Lake Platinum Group Metal (PGM) project is approximately 60km south of NAP’s Lac des Iles Mine operations (LDI).
