Canadian mining company Ivanhoe Mines has acquired a 4.35% stake in South Africa’s helium and liquified natural gas producer Renergen as part of a strategic partnership to own more than 50% of the company. On Monday, Renergen announced the acquisition by Ivanhoe – which already is a developer of the Platreef mine in Limpopo- paid R35.625 per share through an initial placement of 5.63 million shares and raised R200 million in the process.
The plan, it says, is for Ivanhoe to become a strategic partner and major shareholder over the next several months.
In a statement, Renergen says this partnership allows for Ivanhoe to increase its shareholding to 25% by way of a Second Subscription, which when successfully completed, could increase to 55% providing the Canadian company can provide a $250 million equity further development and up-scaling of the Virginia Gas Project.
Ivanhoe’s investment comes at a time where the current global LNG and helium markets are in shortfall and the Virginia Gas Project in South Africa’s Free State holds natural gas with some of the richest helium concentrations recorded globally. The statement reads in part “Transaction paves the way for Renergen to access significant capital towards Phase 2 development, diversifies its investment base into North Africa and minimizes potential dilution to existing shareholders…”