London Stock Exchange-listed Tharisa, a chrome and platinum group metals (PGM) producer, has acquired 26,8% of Karo Holdings to secure access to a tier-one PGM resource on the Great Dyke for US$4,5 million.
By Melody Chikono
Tharisa’s entry into the Zimbabwe PGM industry follows their acquisition of Salene, a Chrome business in Zimbabwe, in mid-May.
Karo Holdings, founded by mining entrepreneur Loucas Pouroulis, and the Government of Zimbabwe entered into an investment agreement in March 2018.
Tharisa is also the platinum and chrome miner run by the Pouroulis family.
Tharisa’s acquisition of the stake in Karo Holdings, which is more than an 80% discount on an independent fair and reasonable valuation, provides the group with the opportunity to increase its investment in the project through discounted farm-in options at the project level.
The first of the projects, Karo Platinum, a 50% indirectly held subsidiary of Karo Holdings, has been awarded the PGM mining rights under a special grant covering an area of 23 903 hectares situated on the Great Dyke in Mashonaland West province.
This area of land was recently released by Zimbabwe Platinum Mines (Zimplats) from its mining lease area in support of the Government of Zimbabwe’s efforts to enable participation by other investors in the platinum mining industry in Zimbabwe.
Tharisa has agreed to provide a US$8 million debt facility to Karo Platinum for the initial geological exploration and sampling work to determine a compliant mineral resource.
Under the agreement, Tharisa will manage the exploration and oversee the subsequent bankable feasibility study.
It is intended that Karo Holdings will apply for National Project Status and for the venture to be contained within a Special Economic Zone.
This will provide the projects with enhanced economics through concessions granted by the Zimbabwe government.
Through its shareholding in Karo Holdings, Tharisa has an option to participate in the other downstream projects through discounted farm-in arrangements at a later stage.