South African mining conglomerate Sibanye-Stillwater has been served with a notice to pay compensation to the owners of the Brazillian mines for terminating a deal to acquire two mines in the South American country. London based Appian Capital which is in charge of the private equity funds which in turn owns the mines, says it will be seeking compensation from the SA firm for pulling out of a 1.2 billion dollar deal that would have been completed this past January.
Sibanye-Stillwater pulled out of the deal, citing a geotechnical instability at the Santa Rita nickel mine. The company is the world’s largest platinum producer and had been in talks to acquire the nickel-cobalt sulphide open mine pit and the Serotte copper-gold mine pit. It cancelled the deal after a pit wall collapsed and fell into the pit in Santa Rita. Describing it as a geotechnical event, Sibanye-Stillwater said in a statement that the company has assessed the event and its effect, and concluded that it is adverse to the business, financial condition, operations, assets or liabilities of the Santa Rita mine.
However, Appian calls the cancellation “unlawful” and insists it will seek to enforce its legal rights and pursue Sibanye-Stillwater for all damages and losses. In a statement it published, Appain says that the mining company did not state that the geotechnical instability was a material adverse event and was a false characterization.