One of South Africa’s major miner, Sibanye Gold said it will be raising about USD1 billion from its shareholders.
Sibanye Gold will be looking at using the fund to finance a takeover of U.S.-based Stillwater Mining Co, it said on Tuesday, a day after the deal secured a U.S. regulatory approval.
According to Reuters News Agency, the Committee on Foreign Investment in the United States, which examines deals for potential national security concerns, has cleared Sibanye’s $2.2 billion takeover of the country’s sole platinum and palladium miner.
The deal will increase South Africa’s grip over global platinum and palladium supply and underline Sibanye Chief Executive Neal Froneman’s determination to branch out of gold mining and South Africa.
“Sibanye management and board has determined that a US$1 billion equity capital raise, through the rights offer, is optimal given current market conditions,” it said in a statement.
The company also said it would raise a further $1 billion in debt, most likely in the bond market, to fund the transaction.
It expects the two tranches of capital to be raised by the end of June.
The rights issue will be voted on by shareholders of Sibanye Gold and Stillwater, a move that will finalise the merger of both companies.