Sibanye-Stillwater plans chrome deal as nears end of restructure

SIBANYE-Stillwater is working on a chrome financing transaction which it will use to further strengthen the balance sheet.A financing deal in chrome, possibly a prepayment, will represent the last piece of a complex, 18-month balance sheet restructuring primarily raising non-debt capital. But the aim of the transaction was not to support more M&A, said Neal Froneman, CEO of Sibanye-Stillwater.“We always had a lot of liquidity but that is not there for M&A, but to ensure that if commodity prices stay as they are, we can ride them out for a long time”. He added that “we’re basically done [on restructuring]” the balance sheet. Froneman was commenting on the sidelines of the Indaba Mining conference in Cape Town on Monday.The group’s net debt to adjusted Ebitda, a ratio used by lenders to gauge the ability of a company to meet its debt obligations, is about 1.4x – well below lender covenants which were revised last year to 3.5x from 2.5x.Asked for details on plans to extract value on chrome, Froneman said: “There is something still in the pipeline around chrome, but we are still working on it. When we can announce it we will”. In December, Sibanye-Stillwater completed a $500m gold and platinum streaming deal with Franco Nevada, a Canadian royalty firm.Froneman said the company had undertaken painful steps to cut unprofitable production in South African gold and platinum group metal (PGM) production, and at its US palladium/platinum mine Stillwater. In addition to stopping an expansion, it halved existing output at Stillwater to 200,000 ounces/year.Stillwater had an operating breakeven of about $1,300/oz prior to receiving a tax subsidiary from the US, details of which would be announced at the group’s financial year-end results announcement on February 21. The Section 45X (S45X) of the final IRA was recently estimated previously to add $240m (R4.2bn) in benefits to Stillwater.Sibanye-Stillwater would also announce whether it would proceed with an investment in Rhyolite Ridge, a lithium-boron project in the US. Froneman said his executive team would submit a recommendation to the investment committee in a few weeks.“If we go ahead with Rhyolite Ridge we will fund it separately. We don’t know how, but it won’t involve shares or equity,” said Froneman.US authorities recently approved an environmental permit for the mine which means Sibanye-Stillwater has to decide if it should exercise a $490m option to help build the project with Australian partner, ioneer.“I’ve said previously we won’t be a dinosaur. We have continued our pivot into battery metals and two projects [Keliber and Rhyolite Ridge] are steps in this regard. We could have gone back to being PGM producer. But that is not us,” he said.The post Sibanye-Stillwater to end balance sheet work with chrome deal appeared first on Miningmx.Weiter zum vollständigen Artikel bei Mining.com Weiter zum vollständigen Artikel bei Mining.com