South Africa’s Sibanye-Stillwater is spending $1 billion on two key Brazilian assets—Atlantic Nickel and Mineração Vale Verde—acquiring them from private equity group Appian Capital Advisory. As covered by the team at mining.com, this is Sibanye’s fourth major battery metal deal this year, following close on the heels of a September investment in ioneer’s lithium-boron project in Nevada.
At the heart of the deal is the Santa Rita mine—one of the world’s largest open-pit nickel sulphide operations. The mine is currently slated to produce 16,000 tonnes of nickel-equivalent annually until 2028. After that, the plan is to take it underground, potentially extending its life by another 26 years.
Also part of the package is the newly constructed Serrote copper-gold mine, owned by Mineração Vale Verde. The Serrote project, in Brazil’s Alagoas state, is expected to produce around 20,000 tonnes of copper-equivalent per year over its 13-year life.
The transaction includes a 5% net smelter return royalty (valued at around $218 million) on future underground production from Santa Rita. Unsurprisingly, Appian has decided to keep a piece of the pie – holding onto royalties from both assets and maintaining ownership of the nearby Pereiro Velho gold project.
What’s interesting is that according to Appian’s CEO Michael Scherb, there was a bidding war behind the scenes that included more than just traditional miners in the mix. That’s right, two (unnamed) automakers were also vying for the assets.
Like I said earlier about the BHP and Forescue scrap, the prospects for battery metal growth are so strong and over such an extended period that M&A potential is going to make the space a very exciting one indeed!
Anthony Milewski
Chairman, Nickel 28 Capital
