Mining
According to Chambers Bowmans is a prominent law firm advising global and regional mining houses on a range of mining projects and legal issues.
Mining
According to Chambers Bowmans is a prominent law firm advising global and regional mining houses on a range of mining projects and legal issues.
- Overview
- Significant Matters
As the long-term demand for Africa’s resources grows, we anticipate a growing demand for related legal services.
We have established ourselves as a leading legal adviser within the mining industry in Africa and offer a full complement of legal services in this sector.
We have a strong record of acting on the most significant mining-related mergers and acquisitions across the African continent. We support our clients through every aspect of mining and resource-related transactions from the initial due diligence through regulatory compliance to negotiating and closing the deals. We have also advised on some of the largest and most innovative debt and equity capital market transactions on the continent.
We are able to co-ordinate our service through a single point of contact offering a seamless service and making the execution of cross-border transactions less cumbersome, time-consuming and costly.
Whether clients are negotiating offtakes, supply side contracts or require day-to-day commercial agreement support, we have the necessary depth of expertise and skills to assist.
We regularly advise clients on all matters relating to local mining legislation, including but not limited to compliance, mining title and other legal opinions, applications and acquisitions of rights, review applications, appeals and due diligences.
We have assisted numerous clients on the interaction of environmental and mining legislation, including licensing, appeals and court reviews of licensing decisions.
We have experience in successfully objecting to the grant of prospecting or mining right applications and pursuing appeals against decisions regarding the grant or refusal of mining and prospecting applications.
Our experience extends to mine incident and accident enquiries, dealing with notifications and assisting with legal compliance associated with health and safety.
Our clients include global mining and resources companies, investors, banks and financial institutions, state-owned enterprises and various government departments within the mining and resources sector.
- We advised Palabora Mining Company on its Brownfield Lift II copper mining expansion project aimed at increasing the life of mine to 2033. The underground block-cave mine development will create hundreds of jobs and business opportunities for the local community.
- We advised African Rainbow Minerals (ARM) on the restructure of the commercial financing arrangements with Glencore in respect of ARM Coal’s participation in the Glencore Participating Coal Business and the Goedgevonden Coal Mine.
- We helped Royal Bafokeng Platinum Mine successfully defend enforcement proceedings threatened under the Mine Health and Safety Act and the Mineral and Petroleum Resources Development Act.
- We advised Royal Bafokeng Platinum Mine on its acquisition of a concentrator plant and related surface rights (including the water and power allocations) in respect of the immovable property owned by Maseve Investments 11 Pty (Maseve) which may be required by RBPlat to access and operate the plant and access to tailings infrastructure, for a consideration equal to the ZAR equivalent of USD 58 million, and the acquisition of 100% of the shares in and shareholder claims owing by Maseve for a consideration equal to the ZAR equivalent of USD 12 million.
- We advised PPC, the largest cement manufacturer in South Africa and a Johannesburg Stock Exchange listed entity, on its proposed merger negotiations with AfriSam Group and various other interested investors.
- We advised Palabora Mining Company on its Brownfield Lift II copper mining expansion project aimed at increasing the life of mine to 2033. The underground block-cave mine development will create hundreds of jobs and business opportunities for the local community.
- We advised First Quantum Minerals on its cross-border procurement of bulk electrical power (150MW) involving Zesco and Eskom, and the complex wheeling arrangements among Botswana, Mozambique, Namibia, South Africa, Zambia and Zimbabwe to supply approximately 150MW of power to its mines in Zambia.
- We advised Harmony Gold Mining Company (Harmony) on a broad-based black economic empowerment transaction in which Harmony will sell to a BEE SPV 3% of its shares in, and 3% of its loan claim against, Harmony Moab Khotsong Operations, the SPV through which Harmony acquired certain significant mining assets from AngloGold Ashanti. Harmony Gold made vendor financing available to the BEE SPV in order to fund the purchase of the loan claim. The transaction also included the creation of a community trust, as well as an employee stock ownership plan (ESOP).
- Bowmans advised Palabora Mining Company (in respect of the Lift II brownfield copper mining expansion project in Palabora. Project value is circa ZAR 9.3 billion.
- Bowmans advised Royal Bafokeng Platinum on their general capital procurement mine construction contracts, all of which are bespoke contracts utilising FIDIC-principles.
- We advised Harmony Gold Mining Company on its USD 300 million acquisition of the Moab Khotsong Mine, the Great Noligwa Mine and related infrastructure from AngloGold Ashanti. We were named Energy and Natural Resources Team of the Year at the African Legal Awards in 2018 for this work.
- We assisted Royal Bafokeng Platinum Mine to seek an interdict and declaratory relief compelling the transfer of employees following the termination of its outsourced mining contract with JIC/ ABMS. JIC/ ABMS is a contract miner that provided all the employees to run the mining operation. It denied that Section 197 automatic transfer provisions applied and refused to transfer employees.
- We advised African Rainbow Minerals on the disposal of its interest in Lubambe Copper Mine, a Zambian mining company. The interest was held through a 50% interest in a company registered in Barbados.
- We acted as tax advisors to Northam Platinum on its USD 10.7 million acquisition of platinum group metals recycling equipment and associated land and buildings for a plant in Pennsylvania, United States of America. This transaction involved cross-border structure issues, including the application of controlled foreign company and transfer pricing rules.
- Ascot Diamonds, one of the world’s largest distributors of diamonds and precious stones on the ongoing financing and refinancing of its long standing diamond producers, Rockwell Resources RSA, one of South Africa’s largest alluvial diamond developers.
- Credit Suisse AG and Standard Chartered Bank as South African and English legal counsel in respect of the ongoing refinancing and debt and equity restructure of the South African mining company, Sibanye Gold Eastern Operations Pty Ltd (previously Southgold Exploration Pty Ltd).
- Wescoal Holdings Limited in relation to a specific issue of shares to a special purpose vehicle (BEE SPV), whose shareholders comprise a consortium of existing Wescoal shareholders.
- We advised Gold One Group (G1) on the refinancing and upsizing of a USD 200 million margin loan facility provided by the Bank of America NA to G1, and secured by Sibanye Gold’s shares listed on the Johannesburg Stock Exchange. The loan was to enable G1 to subscribe and pay for further shares in Sibanye Gold under its rights issue.
- We are involved in a ground-breaking and complex multi-stakeholder facilitation including Anglo American South Africa Ltd, AngloGold Ashanti Ltd, Harmony Gold Mining Company Ltd, Gold Fields Ltd, Sibanye Gold Ltd, and African Rainbow Minerals Ltd, seeking resolution to a class action, and to establish future legal frameworks which are fair to employees and that ensure the future sustainability of companies in the gold mining industry.
- We advised Rand Merchant Bank, Citigroup Global Markets Inc., J. P. Morgan Securities, Morgan Stanley and Co. International and HSBC Bank (as underwriters and joint bookrunners) on a USD 1 billion rights offer and high yield bond offer of USD 2.6 billion by Sibanye Gold, to fund a bridge facility in acquiring the North American Stillwater Mining Company.
- Bowmans represented the underwriters, including Citigroup, HSBC, J.P. Morgan, Morgan Stanley and Rand Merchant Bank, as joint global coordinators on the USD 1 billion rights offering by Sibanye Gold Limited. The rights offering was made on an SEC-registered basis, as well as in a public offering in South Africa. This is the third-largest rights issue ever by a South African company and the largest ever acquisition-related capital raise in South Africa.Bowmans also represented the initial purchasers, led by Citigroup, HSBC and Barclays, as global coordinators on Sibanye’s USD 1.05 billion senior notes offering. The senior notes were issued by Sibanye’s subsidiary Stillwater Mining Company, and guaranteed by Sibanye Gold Limited and certain other of its subsidiaries. This is the largest ever South African corporate bond debut, as well as the largest ever private-sector corporate bond debut in Africa.The net proceeds of the rights offering and the senior notes offering will be used to refinance a bridge facility drawn to fund Sibanye’s acquisition of Stillwater Mining Company, a US-based platinum group metals (PGM) producer.Sibanye is an independent, South African domiciled mining group, which currently owns and operates gold and uranium operations and projects throughout the Witwatersrand Basin in South Africa, as well as PGM operations and projects in the J-M Reef in the United States, the Bushveld Igneous Complex in South Africa and the Great Dyke in Zimbabwe.According to publicly available corporate information, Sibanye is the largest producer of gold in South Africa and is a top ten global producer of gold, and Sibanye’s PGM operations (which were acquired during 2016 and 2017), taken together, are the fourth largest producer of PGMs in the world, based on annual production at such operations in 2016.
Sibanye’s shares are listed on the JSE in South Africa, and its ADSs are listed on the New York Stock Exchange.
The Bowmans team was led by partners Ezra Davids, Ryan Wessels and Casper van Heerden, and comprised associates Sibonelo Mduli, Mohammed Saib and Gabriela Andonova and candidate attorney, Katherine McLean.
- Royal Bafokeng Platinum Limited and Royal Bafokeng Resources Pty Ltd on one of the largest commodities financing transactions of the year, in order to treble production at its new Styldrift mine.
- Nedbank Limited , Absa Bank Limited, The Standard Bank of South Africa Limited (all acting through their respective Corporate and Investment Banking divisions), FirstRand Bank Limited (acting through its Rand Merchant Bank division) and Bank of China, Johannesburg Branch (collectively the Finance Parties) in connection with a ZAR6 Billion three year Revolving Facility Agreement between, the Finance Parties and Sibanye Gold Limited, Sibanye Rustenburg Platinum Mines Proprietary Limited and Aquarius Platinum (South Africa) Proprietary Limited (as Original Borrowers and Guarantors) and Rand Uranium Proprietary Limited (as Original Guarantor).
- Eurasian Resources Group – Africa with project development and disputes relating to its prospecting rights. This includes advice on the ongoing:
- Appeal and renewal of the Amari prospecting right (Bray project);
- Appeal and renewal of the Amalahle Resources prospecting right;
- Updates and impacts of legislative changes; and
- Providing preliminary advice on a possible restructuring transaction.
- We have continued to assist a major mining house in the conversion of defined benefit pension arrangements to defined contribution. This has involved advising on employment law consequences, negotiation of terms of conversion with pension fund Trustees, drafting and settling agreements and related communications to fund members and other stakeholders, and compliance with pension fund regulatory requirements and registration.The matter is important because of its factual and legal complexity, because of the required engagement with multiple stakeholders, and because of the significant financial implications for the client.
- South African counsel to the joint bookrunners in relation to Gold Fields’s accelerated bookbuild share placement valued at R2.3 billion.
- Advised African Rainbow Minerals Ltd on the proposed restructuring of the ARM Broad-Based Economic Empowerment Trust. This involved a specific repurchase by a wholly owned subsidiary of ARM of 12 717 328 million shares in ARM from the ARM Broad-Based Economic Empowerment Trust and the refinancing of the ARM Broad-Based Economic Empowerment Trust. This was a very important transaction for ARM for purposes of ensuring the sustainability of its broad-based black economic empowerment credentials.
- Advised Rio Tinto on the sale of its entire shareholding in Riversdale Holdings Proprietary Limited, which holds a 74% direct shareholding in Zululand Anthracite Colliery Proprietary Limited to Galaxy Investments B.V. This transaction was important to the Rio Tinto group to enable it to focus on other core aspects of its global business and to facilitate an exit in a responsible manner by selling to a purchaser committed to making significant investments to ensure the long term sustainability of the mine and associated employment. Galaxy fits such criteria as it falls within the larger Menar Holding Group which has experience in coal mining in South Africa through its interest in Canyon Coal.
- Advised De Beers in the recent disposal of the Kimberly Mines. The advice amongst others involved the vexed question of liability for historical pollution following the disposal of the underground operations or surface retreatment of the old order dumps.
- Counsel to Shanduka Group Proprietary Limited and the majority shareholders in relation to the restructuring of Shanduka Group Proprietary Limited and merger with Pembani Group Proprietary Limited, to create a new multi-billion rand black-controlled natural resources and industrial holding group.
- Counsel to AngloGold Ashanti in respect of its proposed restructuring (demerger) of the current portfolio of AngloGold Ashanti into separate listed vehicles for each of its South African and international mining operations. The proposed demerger was coupled with a proposed rights offer, both of which were withdrawn following lack of shareholder appetite. This deal was notable due to its complexity, coupled with the size of the proposed capital raising. Based on the market capitalization of AngloGold at the time of the proposed restructuring, we valued the demerger at USD 5 billion, in addition to the rights offer of USD 2.1 billion, giving a total deal value of USD 7.1 billion.
- Advised Absa Bank Limited (in its capacity as Lender and ECIC Agent) in respect of a ground breaking and collaborative initiative to finance one of Africa’s significant new diamond producers in relation to (i) an ECIC backed facility of US$ 84 million made available to the Liqhobong Mining Development Company Proprietary Limited for the construction and development of a mine in the Maluti mountains of Lesotho and (ii) a Eurobond issue by Firestone Diamonds Plc (issuer) and Pacific Road Resources Fund and Resource Capital Fund as Subscribers.
- Cross-border debt restructuring and business rescue of Southgold Exploration Pty Ltd (Southgold).We acted as South African and English lead counsel to CS / SCB as the largest creditor of a South African mining company, Southgold, and its Canadian parent company, in its debt and equity restructure. This was one of the first business rescues brought under the new South African Companies Act, 2008, and is regarded as one of the biggest and most successful business rescues to date. The matter involved banking and finance law, corporate law, business restructuring law, litigation and mining law issues. The total value of approved creditor claims as at 4 July 2013 when business rescue plan was approved and creditors’ claims compromised, was ZAR 11 billion.
Key Contacts
Wilbert Kapinga
Senior Partner | Tanzania
Charles Young
Head of Mining
Rainbow Field
Head of M&A and Director, Employment
Wandisile Mandlana
Partner
African Legal Awards
Energy and Natural Resources Team of the Year, 2020
Bonds, Loans & ESG Capital Market Africa Awards
Metals & Mining Deal of the Year, 2023
Chambers
The team frequently works with lenders and investors on large asset transactions, loan facilities and M&A, as well as acting on high-profile disputes in the mining sector.
Bowmans is well versed in prospecting rights, regulatory issues and brownfield expansion, as well as mining-related environmental law issues.
The practice is equally well versed in regulatory issues and mining-related environmental law issues.
Bowmans has excellent reach and high visibility in cross-border disputes, which include matters in the natural resources sector.
Legal500
The team offers high-profile clients a fully integrated service in relation to a range of mining-related matters, including acquisitions, financing arrangements, employment disputes, energy transitions, and regulation.
Bowmans continues to impress in mining sector corporate transactions, and is also an emerging player in mining regulatory, environmental law and health and safety matters.
Bowmans leading projects and infrastructure department advises high-profile clients on complex domestic and cross-border matters, and has experience in all major sectors, including power generation and transmission, oil and gas, infrastructure, mining and metals, water, and telecommunications.
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