Falconbridge nets $75 m(US) for sale of Western Platinum

Adding to its list of recent asset sell-offs, Falconbridge Ltd has picked up $75 million (US) for the sale of its 49% equity interest in Western Platinum, a South African producer of platinum group metals, as well as of gold, nickel, copper and cobalt.

Under the terms of the agreement, in exchange for 5,929,000 shares of Western Platinum, Falconbridge received $65 million(US) at the close of the transaction. It will receive an additional $10 million on Oct 1 of this year.

While Falconbridge has not revealed the identity of the buyer, it is widely reported that it is the owner of the other 51% of Western Platinum, Lonrho PLC of Britain.

Western Platinum, one of three companies that mines the famous Merensky Reef, was expected to sell about 15% of the platinum coming out of South Africa last year.

Including the proceeds from the sale of Western Platinum, Falconbridge has received approximately $330 million (C) from all its asset sales over the past year.

The nickel producer started to sell off assets when it acquired about $1.2 billion in debt when it purchased Kidd Creek Mines. Among the assets it has let out of the fold are its 56.7% of Kiena Gold Mines, a 19.2% interest in Giant Yellowknife Mines, a 36.7% interest in Akaitcho Yellowknife Gold Mines and a 48.6% interest in Corporation Falconbridge Copper.