Nikanor plc

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Nikanor plc
Company type Public holding company
AIM: NKR (until 2008) [1]
FoundedJuly 2006(17 years ago) (2006-07) (Douglas, Isle of Man)
FounderDan Gertler
DefunctJuly 2008(15 years ago) (2008-07)
FateMerged into Katanga Mining Limited
Headquarters
Douglas
,
Isle of Man
Number of locations
 Katanga Province, Democratic Republic of the Congo
Area served
 Democratic Republic of the Congo
Key people
  • Dan Gertler
  • CEO Jonathan Leslie [2]
Total assets US$452 million (2008)
OwnerDan Gertler

Nikanor plc [3] was a publicly quoted holding company for Global Enterprises Corporate (GEC) with assets in the rich Copperbelt region in Katanga Province, Democratic Republic of the Congo (DRC).

Contents

Nikanor plc was incorporated in 2006 with its registered head office in Douglas, Isle of Man. Nikanor's stock was listed on the London Stock Exchange's (LSE) Alternative Investment Market in London in July 2006. The initial public offering (IPO) raised US$400 million, and Nikanor's market capitalization reached $1.5 billion. [3]

The senior management team of Nikanor included Emile Mota and Simon Tuma-Waku, who were the chief of staff and Minister of Mines and Energy under DRC President Joseph Kabila. According to Mining Journal, Kabila promulgated the new mining code in 2002. [4]

In May 2007, Beny Steinmetz, Dan Gertler and the Gertler Group, Nikanor's three main stakeholders, launched a hostile take over bid for Nikanor. The bid valued Nikanor's shares at £6.00, the price when it floated, and was presented by the Cosaf Ltd consortium [note 1] (which also includes the Swiss trader and Gertler's long-time associate, Glencore International AG and UK equity fund, RP Capital Partners). [note 2] The bid was opposed by those shareholders in Nikanor not involved in the bid. [4]

In January 2008, Nikanor was merged into Katanga Mining Limited. [note 3] Katanga Mining Company (KMC) paid $452 million to Nikanor shareholders. [5] Nikanor planned on participating in the consolidation of the companies operating in the Zambian–DRC Copperbelt region.

In a 2011 article by Reuters, journalists described how Glencore and Dan Gertler partnered in Nikanor from 2007 until its final merger with Katanga Mining.

In June 2007, Glencore and partner Dan Gertler, an Israeli mining magnate, paid GB£300 million pounds for a quarter-stake in mining company Nikanor, which was seeking to revive derelict copper mines next to Katanga's. That deal gave Glencore exclusive rights to sell all Nikanor's output – an "offtake" agreement [...] By investing in Nikanor, Glencore consolidated a powerful partnership [...] linked to Gertler, an old Congo hand [with] close ties to government officials including President Joseph Kabila.

On Christmas Eve 2008, in the depths of the global financial crisis, Katanga Mining [...] had lost 97 percent of its market value over the previous six months and was running out of cash. Global credit was drying up, the copper market had fallen 70 percent in just five months, and Congo [...] was the last place an investor wanted to be. [...] For about [US]$500 million in a convertible loan and rights issue, Katanga agreed to issue more than a billion new shares and hand what would become a stake of 74 percent to Glencore [... By early 2011] with copper prices regularly setting records above $10,000 a ton, Katanga's stock market value [had reached] nearly $3.2 billion. [...Since the Glencore acquisition,] Katanga Mining is reaping the benefit of the surging markets and its wealthy, powerful owner. After losing $108 million in 2009, it posted an annual profit of $265 million in 2010. [6]

Timeline

Timeline summary of transactions:

Nikanor plc and DRC Copper and Cobalt Project (DCP)

On September 9, 2004, GEC signed a joint-venture (JV) agreement with the state-owned Gécamines [9] to rehabilitate and operate the Kananga and Tilwezembe mines. The deal was ratified by Joseph Kabila's presidential decree. [3] The final joint-venture structure was held 75% by GEC and 25% by Gécamines, with GEC undertaking to invest $300–400 million in a new leaching plant, with projected output to reach 200,000 tons of copper a year, based on its interests in the huge KOV (Komoto Oliveira Virgule). [2] GEC and Gécamines formed a subsidiary named DRC Copper and Cobalt Project (DCP), 75% owned by Global Enterprises Corporate Ltd. and 25% by Gécamines, with properties located next to Katanga Mining's properties near Kolwezi. [5]

Nikanor plc and KOV (Komoto Oliveira Virgule)

KOV (Komoto Oliveira Virgule) is a "massive open cast copper-cobalt project comprising the world-class assets Tilwezembe and Kananga deposits and the Kolwesi concentrator in the DRC's Katanga province." [2] In 2006, exploitation permits for the assets were transferred to the companies' subsidiary, DCP. Gertler and Steinmetz placed GEC's 75% share of KOV into Nikanor plc, registered in the Isle of Man.

Nikanor and Katanga Mining Limited

In January 2008, Nikanor was merged into Katanga Mining Limited, when the latter acquired it for $452 million. [5] Katanga Mining Limited operates a major mine complex in the DRC producing refined copper and cobalt with the "potential of becoming Africa's largest copper producer and the world's largest cobalt producer." [13] Katanga paid $452 million in cash to Nikanor shareholders. [5] Nikanor planned on participating in the consolidation of the companies operating in the Zambian–DRC Copperbelt region.

See also

Notes

  1. ↑ Cosaf Limited (Cosa) consortium (which also includes the Swiss trader and Gertler's long-time associate, Glencore International AG) is managed by a subsidiary of RP Capital Partners Cayman Island Limited and owned by family members of Dan Gertler and Ruwenzori Limited (Ruwenzori), which is itself controlled by Cosaf. (Early Warning Report 26 March 2010)
  2. ↑ RP Capital Group, co-founded in 2004 by Rafael Berber and Peter Kellner, specializes in alternative investment management strategies and advisory services. RP Capital established Ruwenzori Ltd in 2007 as a "special purpose vehicle" (SPV) to raise £372 million for Nikanor (Mining Journal 2008). RP Explorer Master Fund (RP Explorer) Cosaf Limited (Cosa) is managed by a subsidiary of RP Capital Partners Cayman Island Limited and owned by family members of Dan Gertler and Ruwenzori Limited (Ruwenzori) which is itself controlled by Cosaf) (Early Warning Report 26 March 2010)
  3. ↑ Katanga Mining Limited TSX:KAT operates a major mine complex in the DRC, producing refined copper and cobalt with the "potential of becoming Africa's largest copper producer and the world's largest cobalt producer (Katanga Mining, February 11, 2009)."[ better source needed ]
  4. ↑ Katumbi supported President Joseph Kabila and "helped finance his electoral campaign by selling the rights to the Kinsevere copper deposit", held by Moise Katumbi's firm, Katanga Mining Company (KMC), to Anvil Mining Ltd (Mining Journal, 2008)."
  5. ↑ KOV (Komoto Oliveira Virgule) is a "massive open cast copper-cobalt project comprising the world-class assets Tilwezembe and Kananga deposits and the Kolwesi concentrator in the DRC's Katanga province (Sergeant, April 4, 2007)."

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<span class="mw-page-title-main">Katanga Province</span> Former province in DR Congo

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<span class="mw-page-title-main">Gécamines</span> Congolese commodity and mining company

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References

  1. ↑ Hill, Liezel (11 January 2008). "Katanga shareholders approve Nikanor merger". Mining Weekly. Retrieved 10 October 2022.
  2. 1 2 3 Barry Sergeant (4 April 2007). "Nikanor's quandary: Meet Dan the man, King of the Congo". Money Web. Retrieved 23 March 2013.
  3. 1 2 3 4 5 6 7 8 Barry Sergeant (3 April 2007). "Nikanor's DRC mining contract quandary: Meet Dan the man, King of the Congo". Johannesburg: Mine Web. Archived from the original on 20 December 2012. Retrieved 24 March 2013.
  4. 1 2 3 4 5 6 "Report on Democratic Republic of Congo (2006-2007)". Mining Journal: The Mining Industry's Weekly Journal. 1 January 2008. Archived from the original on 11 April 2013. Retrieved 23 March 2013.
  5. 1 2 3 4 5 "History: dead link". Katanga Mining. Archived from the original on 10 November 2011. Retrieved 16 November 2011.
  6. ↑ Eric Onstad; Laura MacInnis; Quentin Webb (25 February 2011). "The biggest company you never heard of". Reuters. Retrieved 28 March 2017.
  7. 1 2 3 Annual Report: Investor Relations: Corporate Structure of Katanga Mining Limited (KML) (PDF) (Report). Katanga Mining Limited. 2011. Retrieved 23 March 2013.
  8. 1 2 3 "Metals and Mining: Company Overview of Global Enterprises Corporate Limited". Bloomberg Business Week. Archived from the original on 10 April 2013. Retrieved 23 March 2013.
  9. 1 2 "Entre la la Générale des Carrières et des Mines et Global Enterprises Corporation Ltd relative a l'exploitation de la mine a ciel ouvert de KOV et des Gisements de Kanaga et de Tilwezembe" (PDF) (in French). 9 September 2004. Archived from the original (PDF) on 3 March 2016. Retrieved 24 March 2013.
  10. ↑ Matthew Hill (1 June 2007). "Nikanor plans share issue to raise R5,2bn". Mining Weekly.
  11. ↑ Liezel Hill (8 February 2008). "Katanga agrees to sell DRC deposits to govt for $825m". Mining Weekly. Retrieved 10 November 2011.
  12. ↑ Barry Sergeant (29 January 2008). "Katanga Mining's DRC/China copper/cobalt conundrum". MineWeb. Archived from the original on 1 February 2008. Retrieved 10 November 2011.
  13. ↑ "Katanga announces second closing of US$265 million mandatorily convertible loan facility". London, UK: Katanga Mining. 11 February 2009.
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