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Impala and Royal Bafokeng share prices react favourably to acquisition offer

Impala platinum has made an offer to acquire the issued ordinary share capital of Royal Bafokeng Platinum

Source: Bloomberg

While the following details pertain to the recent Impala Platinum bid for Royal Bafokeng Platinum, we would first like to extend our heartfelt condolences to the families and friends of the three miners who lost their lives in a mud slide at Impala’s Rustenburg operations on the 29th of November 2021, as a matter of higher importance.

Impala Platinum to acquire 24.5% of Royal Bafokeng Platinum

Implats has announced that the company has concluded agreements with a number of institutional shareholders to buy 24.5% of Royal Bafokeng Platinum.

Impala offer to ordinary shareholders of Royal Bafokeng

The company has further announced its intention to buy the remaining issued ordinary share capital of RBPlat, with a minimum acceptance level of 50%.

Details of the offer

Implats firm intention offer is at value of R150 per share, for all the shares it does not already hold in RBPlat. The R150 per share offer is made up of R90 in cash and 0.30 Implats shares for one RBPlat share.

Suggested benefit of the offer

Implats’ acquisition of a majority stake in RBPlat is suggested to provide strategic, operational and financial benefits for all stakeholders. The acquisition and the synergies created are expected to grow and optimize value of the Implats asset portfolio, enhancing the group’s Western Limb production base the most significant source of Platinum Group Metal (PGM) production globally. The group has also suggested that by extending life of mines, the acquisition would increase job security as well as socio-economic benefits particularly within the greater-Rustenburg region.

RBPlats to review offer

The RBPlat board has appointed PSG Capital as an independent to assess and guide shareholders as to whether the terms and conditions of the deal are fair and reasonable

Impala Platinum – Technical View

Source: IG Charts

The share price of Impala Platinum has formed a bullish price reversal off range support at 17910. The price reversal is supported by a move out of oversold territory by the stochastic oscillator.

Range resistance at 22710 provides the initial upside target from the move. Traders who are long might consider using a close below the reversal low at 17910 as a stop loss indication for the trade.

This information has been prepared by IG, a trading name of IG Markets Ltd and IG Markets South Africa Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

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