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Aquarius shares plunge

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JOHANNESBURG — Aquarius Platinum’s shares plunged on Monday, coinciding with a notice from the Zimbabwean government that ordered mining companies to resubmit exploration right applications. Zimbabwe’s Empowerment minister Saviour Kasukuwere expects to finalise the transfer of majority stakes in foreign mining companies to local black investors by the end of this month. Aquarius, listed in […]

JOHANNESBURG — Aquarius Platinum’s shares plunged on Monday, coinciding with a notice from the Zimbabwean government that ordered mining companies to resubmit exploration right applications.

Zimbabwe’s Empowerment minister Saviour Kasukuwere expects to finalise the transfer of majority stakes in foreign mining companies to local black investors by the end of this month. Aquarius, listed in Australia, Johannesburg and London, has mines in SA, but the Mimosa Mine it shares with Impala Platinum in Zimbabwe is the most profitable.

“I think investors are taking a view on Aquarius because Mimosa is the only mine in the group that’s making money and anything that threatens it goes right to the core of the company,” an analyst said.

Aquarius shares fell 7,4% on the Johannesburg Stock Exchange to R15,92. In London, the share dropped more than 5%.

A notice published by the mines ministry in the government-owned Herald newspaper yesterday ordered 469 foreign and locally-owned mining companies to resubmit exploration rights applications, detailing proof of funding, holding structures and technical capacity.

Both Aquarius and Impala said they had not been directly contacted by the ministry and could offer no comment.

“We’ve seen the notice in the Herald, but we’ve not been officially notified. It does not appear to affect us,” Aquarius spokesman Gavin Mackay said on Monday.

Impala’s Bob Gilmour said: “We have heard nothing official. We are in production,” pointing out the notice appeared to be directed at companies with exploration assets rather than those in production.

The notice could be geared towards adding uncertainty to Zimbabwe’s mining environment, lowering the share prices of companies operating there and making it cheaper for the government to acquire the 51% stake in foreign-owned companies as stipulated in its indigenisation legislation. The government could also simply be conducting an audit of all projects and prospects in Zimbabwe to discover what it can acquire.

Impala, after a bruising engagement with the government, reached an “in principle” agreement last month to transfer a 51% stake in its 87%-owned Zimplats. The fair value of a 31% stake to be sold to the government’s National Indigenisation and Economic Empowerment Fund for cash was yet to be determined. Impala will fund the purchase of a 20% stake in Zimplats to communities and workers. A similar agreement has been struck for Mimosa, but the matter has been handled with far less fanfare.

Mimosa’s owners and the government are now talking about the fair value of the stake and funding of the deal. The parties will make an announcement once there is clarity on these matters.—Businessday/Reuters