Sibanye banking on electric car boom with bid for 30% stake in Finnish lithium miner

Sibanye CEO Neal Froneman
Sibanye CEO Neal Froneman

Sibanye-Stillwater is expanding its footprint into the lucrative battery minerals market with a 40 million euro bid for a 30% stake in a Finnish company, Keliber Oy.

The company is located in Finland's Kaustinen region, which is said to be one of the most significant lithium-bearing areas in Europe. 

Sibanye, a major platinum group metals (PGM) producer, with gold assets, had indicated its appetite for battery metals as part of its growth strategy, with CEO Neal Froneman saying lithium is viewed as one of the core metals to benefit from the significant growth forecast for the electric vehicle sector.

The company will make an initial phased equity investment of R30 million euros, followed by a an addition 10 million euros equity issuance, a transaction that would be financed through debt and equity.

"Our investment in Keliber represents a strategic partnership of complementary skills and capabilities and a shared vision to be a preferred provider of responsibly sourced battery-grade materials for the market," said Froneman.

The Keliber project consists of several advanced-stage lithium spodumene deposits, with significant exploration upside in close proximity to the existing project. A feasibility study showed that the project holds 9.3 million tons of ore reserves, giving it more than 13 years of operation.

Production is expected  to start in 2024 and the project includes the development of a chemical plant in Kokkola, approximately 50km from the mining area, which will produce battery-grade lithium hydroxide.

Sibanye said Finland represents an attractive, low-risk mining jurisdiction and has developed a national battery strategy that outlines the objectives for the country to become a competitive.

The miner last week announced that it would plough R6.8 billion in three South African mining projects, as the company reaps the rewards of the current commodity cycle which has given its earnings a boost. The transaction is subject to SA Reserve Bank approval.

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