A deal in hand combines two in the Bushveld

Vancouver – Anooraq Resources (ARQ-V) and Pelawan Investments have been given conditional approval from the South African Exchange Bank for their business combination.

Pelawan’s planned reverse-takeover (RTO) of Anooraq will create the first North American listed Black Economic Empowerment (BEE) company and merge the platinum group mineral projects of both entities.

Anooraq will gain Pelawan’s 50% interest in the Ga-Phasha platinum group metals project situated on the eastern limb of the Bushveld Complex in South Africa. Ga-Phasha is an advanced-stage PGM project that is a 50/50 joint venture with Anglo Platinum (AAPTY-Q). The combination of this project with Anooraq’s PGM properties, on the northern limb of the Bushveld, will form the asset base for a significant new PGM company in the area.

Once the RTO is successfully completed, anticipated later this year, Anooraq will become a qualified BEE, a requirement under South Africa’s new mining act for any development of new mines. Anooraq will also be the operator on the Ga-Phasha partnership with Anglo.

Pelawan will be issued 91.2 million Anooraq shares and paid up to 9.25 million Rand (about $1.9 million) in return for its interest in Ga-Phasha. Of the shares issued, 89 million will held in escrow for the lesser of six years from the issue date or 12 months from commencement of commercial production. Initially, Pelawan shareholders will hold over 62% of Anooraq and cannot be diluted to less that 52%.

The 9,700-hectare Ga-Phasha project covers portions of both the UG2 and Merensky Reefs, the two main PGM-bearing horizons in the Bushveld Complex. A measured and indicated resource of 65.7 million tonnes grading 6.97 grams PGMs (combined platinum, palladium, rhodium and gold) per tonne has been calculated within the UG2 Reef section of the property plus an additional 137.4 million tonnes of 4.32 grams PGMs of inferred resource. Within the Merensky Reef portion of the project, there is a measured and indicated resource of 43.3 million tonnes of 4.39 grams PGMs plus an additional inferred 111.5 million tonnes of 7.1 grams PGMs.

The Bushveld Complex, in northeastern South Africa, is the world’s largest known layered mafic intrusive hosting about 80% of the world’s platinum resources while accounting for over 60% of global PGM production.

Upon resumption of trading, investors sold off the issue on the news, closing it at $1.95, down 26% at presstime on high volume. As reported in recent figures, Anooraq has 54.1 million shares outstanding.