Johannesburg – Private equity fund Pallinghurst Resources has unused investors’ commitments of up to $750 million (R5.8 billion) available for acquisitions that may attract the group as it grows its holdings in luxury goods, gemstones, and platinum, manganese and iron ore mining.
Pallinghurst, which listed on the JSE yesterday, also had $35 million in cash available after making commitments to spend $135 million, said group chairman Brian Gilbertson.
He said the company, which was already the world’s biggest gemstone producer, could raise further funding in the next year or two. But he declined to say how much money the group could raise.
Gilbertson owns almost 6 percent of the company, a stake that was worth about R92 million yesterday.
He said the company, which did not raise money in yesterday’s listing, had already raised $1 billion from investors including Korean steel company Posco and AMCI, an affiliate of American Metals & Coal International.
The company had been established to identify opportunities in the mining sector that were “unloved”. It had already found four such ventures.
As part of its aim to supply raw materials to the steel industry, Pallinghurst has got involved in the Ntsimbintle joint venture, a manganese project in the Northern Cape.
A bankable feasibility study is expected to be completed at Ntsimbintle in the second quarter of next year. It is planned to bring the venture into production in three years. “Our projects have been carefully selected,” Gilbertson said.
Pallinghurst has interests in two local platinum mining projects.
Gilbertson said the company’s first Fabergé jewellery collection would be ready in the second quarter of next year. Pallinghurst might offer eyeware, handbags and watches under the Fabergé brand.
Arne Frandsen, Pallinghurst’s chief executive, said the company had interests in four iron ore deposits in Australia. These included an interest in Jupiter Mines, which has iron ore, nickel, uranium and gold projects, as well as three privately held iron ore deposits. Jupiter Mines is listed on the Australian Stock Exchange.
Frandsen said Pallinghurst had considered entering the diamond industry. However, this was a “very big and complex market” and the company needed to see “value proposition to enter the market”.
In the four months to December, Pallinghurst generated a net profit of $4.1 million as profit from the company’s associates outweighed a loss from operations. At the end of December the company had cash on hand of $86.1 million.
Pallinghurst has an effective 58 percent stake in Gemfields Resources. On Tuesday Gemfields opened a cutting and polishing facility in Jaipur in northern India. The factory employs 30 people and will process high-grade rough emeralds from Gemfields’ Kagem mine in Zambia.
Gemfields has a market value of about £113 million (R1.6 billion).
Pallinghurst’s opening trade on the JSE was at R8.50. The shares rose 8.2 percent to R9.20, valuing the company at R1.56 billion. The equity investment instruments sector fell 0.26 percent.
