Sibanye-Stillwater to sell majority stake in Canadian PGM-copper project

The Marathon project was acquired by Stillwater Mining in 2010 and it felt fell into the hands of Sibanye in 2017, when it bought Stillwater for $2.2 billion. (Image courtesy of Sibanye-Stillwater)

South Africa’s Sibanye-Stillwater (JSE:SGL) (NYSE:SBGL) has decided to sell its majority stake in a platinum group metals-copper project in Canada to mineral exploration and development company Generation Mining.

Under the terms of the agreement, the local junior will earn a 51% in the Marathon project, in northern Ontario, by advancing the development of the asset through further economic studies.

Gen Mining can earn an additional 29% interest within four years by investing at least C$10m and delivering a PEA

Sibanye-Stillwater will receive C$3 million (about $2.3m) in upfront proceeds and 11 million shares at 0.2714 Canadian dollars per share in Gen Mining, equivalent to a 12.9% equity stake.

In exchange, Gen will not only secure a majority stake in the Marathon, but also form a joint venture with Sibanye-Stillwater Canada and be the operator of it.

Additionally, the Canadian junior will have the right to earn an additional 29% interest within four years by investing at least C$10 million and delivering a preliminary economic assessment.

The companies first announced a potential transaction in April, when Gen Mining signed a letter to earn into the property, adjacent to Lake Superior, and which comprises 44 mining leases and 82 contiguous claims.

The deal is expected to be completed by mid-July.

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