Richards Bay Minerals (RBM) and its shareholders Rio Tinto and BHP Billiton are pleased to announce the completion of the Broad Based Black Economic Empowerment (BBBEE) transaction (the transaction) at RBM. The transaction represents the largest BBBEE transaction in KwaZulu-Natal to date through the sale of a 24 per cent equity interest in RBM to Blue Horison Investments 41 (Pty) Ltd (Blue Horison). In addition, RBM employees will hold 2 per cent of the equity in RBM through an Employee Share Participation Scheme (ESPS).
Blue Horison is made up of a group of seven separate business consortia which will be joined by the four communities that surround RBM's activities. The seven business consortia together hold 55% of the equity in Blue Horison. The Sokhulu, Dube, Mbonambi and Mkhwanazi communities which have a combined population in excess of 140 000 people, will hold the remaining 45% of the equity in Blue Horison. All of RBM's approximately 1,750 permanent employees (the majority of who are Historically Disadvantaged South Africans) will participate in the equity through the ESPS.
J B Magwaza, Chairman of Blue Horison and one of the new BBBEE partners who will have a seat on the RBM Board said, "We are all delighted that this transaction is finally completed. The inclusion of the host communities and the employees of RBM makes this deal great in its empowerment of the historically disadvantaged people of KZN. We look forward to making a positive contribution in the business of RBM".
RBM has committed to paying each of the host communities a once-off endowment of R17.5 million. These amounts will be paid into each of communities' Public Benefit Trusts which have been specifically established for this transaction.
RBM has submitted its mining conversion application to the Department of Mineral Resources and it is in the process of being assessed by the department.