THE sale of Mineração Vale Verde (MVV) for $420m last week could have a bearing on the extent of damages Sibanye-Stillwater might have to pay to Appian Capital Advisory, said the precious metal miner’s CEO-designate, Richard Stewart.
Sibanye-Stillwater and Appian Capital are at loggerheads over the South African firm’s decision to abandon the purchase of Appian’s MVV in 2021. MVV owned Santa Rita, a copper mine in Brazil.
Appian is claiming damages of up to $721m as a result of the aborted sale which Sibanye-Stillwater unsuccessfully argued in the UK High Court last year was because of a ‘material adverse event’. The UK court didn’t agree with this assessment and will in November make a ruling on the quantum of damages payable to Appian by Sibanye-Stillwater.
However, Sibanye-Stillwater has argued the damages claim should be offset against the value derived from MVV since their deal was called off. According to the miner this includes operational profits and now the sale, which was to Baiyin Non Ferrous, a Chinese company.
“We have always maintained there were opportunities to realise value and that has an impact on our view of what those potential damages claims could be,” said Stewart on the sidlines of the PGM Industry Day, a conference held in Johannesburg on April 3.
“It potentially crystallised the number that could be put into calculations,” said Stewart, adding that he would let the respective legal teams “do the numbers”.
“But it crystallises the story we’ve been saying. You can’t claim damages on something you have realised value for,” he said.
A spokesperson for Appian Capital Advisory said that it was “entitled to compensation for all losses caused by Sibanye-Stillwater’s unlawful termination of the $1.2bn transaction for MVV and Atlantic Nickel, which was also part of the initital deal. This included accrued interest on the full price for MVV over the more than three years it has taken to re-sell the asset, said Appian Capital in a statement.
“The sale of MVV to Baiyin Nonferrous has already been factored into Appian’s calculation of its losses, which are presently quantified at up to $721m and which will be determined by the English High Court in a hearing later in the year,” a spokesperson for Appian Capital said.
