DealMakers - 2025 Annual
BEE Deal of the Year
Exxaro Resources’ acquisition of manganese assets from Ntsimbintle and OMH Mauritius
The acquisition of premier manganese assets represents a defining transformational transaction for both the company and the global mining sector, and at the same time, advances South Africa’s empowerment agenda. The deal, valued at an unadjusted cash price of R11,67bn, marks a strategic pivot for Exxaro, accelerating its transition from coal to a diversified minerals and energy solutions business.
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Essentially, the deal sees Exxaro acquiring 74% of Ntsimbintle Mining, a subsidiary of Ntsimbintle Holdings – in which entrepreneur Sakkie Macozoma’s Safika Holdings has a 39.7% stake – and the remaining 26% of Ntsimbintle Mining from OMH Mauritius.
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The target assets are:
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100% of Ntsimbintle Mining, which holds an effective 60.1% ownership in Tshipi Borwa Mine, an open pit manganese mine in the Kalahari Manganese Field in the Northern Cape – South Africa’s largest single mine manganese exporter, and the world’s 4th largest manganese producer.
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19.99% of Jupiter Mines. Jupiter is an Australian registered public company, listed on the ASX, with a 49.9% beneficial interest in Tshipi.
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100% of Ntsimbintle Marketing, which conducts manganese marketing and sales, and will, following the transaction, have the right to market 50.1% of Tshipi’s finished manganese ore products.
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51% of Mokala, owner of the Mokala Manganese Mine operated by Blue Falcon 222, which directly owns 49% of Mokala. Blue Falcon, which is a Glencore entity, has pre-emptive and tag along rights in respect of Mokala.
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9% of Hotazel, which owns the Hotazel Manganese Mines, operated by Samancor Manganese. Samancor Manganese, which owns 74% of Hotazel, is 60% owned by South 32 and 40% by Anglo American. Samancor Manganese and the other existing shareholders of Hotazel have pre-emptive rights in respect of Hotazel.
The pre-emptive rights waiver processes for Blue Falcon and the Hotazel shareholders are included as part of the suspensive conditions to the transactions.
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The initial price tag is R11,67bn, but the deal includes a “locked box” structure, which suggests that any financial leakage prior to closing, such as dividends, losses or capital shifts, could result in upward adjustments to the purchase price. In addition, if Mokala’s minority shareholder, Blue Falcon, exercises its tag-along rights, the total may increase to R14,64bn. The deal was funded from internal resources, with no anticipated impact on its dividend policy or net cash position.
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The manganese operations come with pre-existing offtake agreements into China and India, mirroring Exxaro’s existing coal customer base. The integration is likely to be operationally smooth, as Exxaro’s existing logistics and bulk commodity trading capacity are already geared towards these corridors.
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The deal is a strategic fit for Exxaro, opting for manganese owing to the significant resource base in South Africa’s Northern Cape (representing about 70% to 80% of world resources, and 34% of global mined production in 2024). The company has experience in the operation of large open pit mines, which are within Exxaro’s bulk mining capabilities and expertise, and the assets are in a jurisdiction understood by the group. The assets are EBITDA (earnings before interest, taxes, depreciation and amortisation) and cash flow positive, with a track record of attractive dividend payments.
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The transaction marks a notable moment in South Africa’s mineral economy. It is a transfer of strategic mineral assets from one black-controlled enterprise to another. It positions Exxaro as a full-spectrum mining house, with assets in coal, manganese, renewables, and energy infrastructure. It also amplifies its exposure to political and regulatory sensitivities. This move marks a bold step in Exxaro’s strategy to diversify beyond coal and deepen its presence in energy transition minerals.
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The deal was extremely complex, involving a suite of transactions, with five different target companies and at least two (potentially three if tag along rights are exercised) different sellers who were independent of each other, each requiring separate negotiations and separate transaction documents. In addition, the transactions involved numerous listed groups of companies.
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The deal required regulatory approvals from the Competition Commission, two Section 11 DMRE consents, environmental and beneficiation approvals, and FinServ clearance. Numerous and complex exchange control approvals involved the jurisdictions of South Africa, Australia, Mauritius, Malaysia, Singapore, China, Namibia and India. The transaction is expected to close in early 2026, subject to regulatory approvals and conditions.
By securing the manganese assets, Exxaro has ensured continued South African ownership of minerals critical to global decarbonisation and renewable energy technologies.
Local Advisers: Investec Bank, Itai Capital, Barclays, ENS, Webber Wentzel, Werksmans and Deloitte.
Comment from the Independent Panel:
The deal represents empowerment in action, with the realisation of valuable assets by a BEE group through acquisition by Exxaro, also an empowered organisation. This was a landmark transaction in the mining industry due to both its size and the pivot within Exxaro towards this important mineral for South Africa, with local communities benefitting from Exxaro’s investment. The number of listed entities in different jurisdictions (three different stock exchanges) made this a complex transaction to execute.
BEE Pick of the best in no particular order
MultiChoice Group (Canal+) to a consortium of BEE parties - a 51% stake in LicenceCo
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The deal is part of the Canal+ mandatory offer for the remaining MultiChoice (MCG) shares announced in March 2024, which created a continental media giant with a footprint across 50+ African countries. The transaction faced two major challenges that had to be overcome if it was to comply with South African requirements.
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On the one hand, the Electronic Communications Act stipulated that foreign shareholders were limited to 20% of the voting rights of broadcasting licensees, and on the other, the Independent Communications Authority of South Africa (ICASA) required licensees to be 30% owned by historically disadvantaged individuals (HDPs).
To satisfy regulators, MCG carved out a new entity, LicenceCo, to hold all South African broadcasting licences and contracts with local subscribers. LicenceCo would also be responsible for maintaining the agreements for the news content already on DStv. It will remain South African-controlled, ensuring local oversight and public interest protections.
In terms of the LicenceCo transaction, the newly formed entity is majority-owned and controlled by HDPs. Phuthuma Nathi will be stakeholders (27%), alongside Identity Partners Itai Consortium, 13th Avenue Investments and the MCG Workers Trust, which benefits employees and key suppliers. MCG’s shareholding in LicenceCo will ultimately give it a 49% economic interest and 20% of the voting rights, ensuring LicenceCo is majority black-controlled. In addition to the BEE aspect, the deal will result in material local content, supplier and skills development over the next three years.
MCG will also retain its existing 75% direct interest in MultiChoice SA. Phuthuma Nathi will similarly retain its existing 25% interest in MultiChoice SA.
Phuthuma Nathi was created in 2006 to offer black South Africans the chance to own an indirect stake in MultiChoice South Africa. The BEE entity, which initially owned a quarter of MultiChoice, has paid more than R13bn in dividends to its 80,000 shareholders. Identity Partners Itai Consortium is a black women-owned investment firm, established in 2008, that invests in companies such as Sasol and Inala Broadcast. 13th Avenue Investments, founded in 2018, is linked to former Telkom CEO Sipho Maseko, and targets companies with high growth potential or leadership positions in the property, energy, engineering, financial services and ICT sectors.
The funding mechanisms were complex, but tailored to enable inclusive ownership without upfront capital barriers. These structures guarantee genuine economic interest, rather than merely symbolic ownership, by converting shares into full equity upon meeting the funding threshold, aligning with national equity goals and setting a benchmark for black economic empowerment in foreign-led acquisitions.
There were a myriad of regulatory considerations in this transaction. The BEE deal entailed navigating conditions which related to the mandatory offer, as well as conditions relating to the reorganisation of the group. It also required approvals from the Competition Authorities, ICASA, the Takeover Regulation Panel, the Prudential Authority, and filings with the BEE Commission. The source of significant complexity in the transaction was the limitation of foreign ownership, and control of South African broadcasters. The memorandum of incorporation and governance structures of the group were also tailored to ensure compliance with the foreign ownership and control restrictions, including the creation of various classes of shares with bespoke voting and economic rights. n
Local Advisers: Citigroup Global Markets, Morgan Stanley, Merrill Lynch, J.P. Morgan, Itai Capital, Merchantec Capital, Webber Wentzel, Werksmans, Herbert Smith Freehills Kramer South Africa, Bowmans, TGR Attorneys, BDO and EY.
The four entities will receive a mix of ordinary and notional vendor-funded shares. These shares will initially have limited rights, but gradually convert to full shares as funding balances reduce. Phuthuma Nathi acquired its stake in LicenceCo via a loan claim of R3,77bn (US$210m) from MCG, while 13th Avenue and IPIC contributed R287m ($15m) in equity.
After the implementation of the steps in the reorgani-sation, MultiChoice South Africa will declare an extraordinary dividend to its shareholders, of which R343,75m will go to Phuthuma Nathi.
Comment from the Independent Panel: This was a large, very high-profile transaction that has altered the African media industry. The creation of LicenceCo with an 85% HDP shareholding addresses the nuances of South Africa’s regulation, while at the same time embedding BEE into this major transaction.
AECI to the AECI Foundation of an effective 15.5% interest in AECI Mining
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In February 2025, the company boosted AECI Mining’s black ownership to a fully empowered entity, unlocking access to enhanced competitiveness and procurement opportunities by way of a transformative broad-based ownership scheme structure. The deal improves the mining business’ black and historically disadvantaged persons ownership from 41.9% to 51%.
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AECI Mining is a provider of comprehensive mining solutions, specialising in the manufacture and supply of explosives, initiating systems, blasting services and mining chemicals, with a history spanning more than 100 years.
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AECI Mining will issue 73,586,835 B ordinary shares to the Foundation, equivalent to a total transaction value of R522m, equating to an issue price of R7.10 per B ordinary share. The B ordinary shares will carry the same voting rights as the existing issued ordinary shares of AECI Mining, and will represent 15.5% of the total voting and economic rights in AECI Mining.
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The Foundation funded 35% of the value (with cash contribution received from AECI Mining), with notional vendor financing making up the remaining 65%. The funding rate on the notional vendor financing is the lower of dividends declared in respect of the B ordinary shares and 60% of the prevailing prime rate. This funding structure will remain in place until it has been reduced to nil. The Foundation will receive trickle dividends of 20% of distributions from AECI Mining for the first 10 years, and 25% thereafter.
The Foundation is an existing public benefit organisation (PBO), originally established in 2004, with a significant and successful track record. It prioritises holistic development for orphans and vulnerable children in the communities located in the areas in which AECI Mining operates.
The use of a PBO in a B-BBEE ownership structure is innovative in that it ensures a broad-based community benefit, long-term sustainability, and full alignment with ESG and social licence imperatives.
The transaction was not a single equity transfer; rather, it was a multi-layered ownership restructuring that included the creation and issue of a new class of B ordinary shares in AECI Mining. The economic interest carve-out – limited to South African operations (AECI Mining Explosives and Chemicals) – added precision and strategic control. The integration of a cash contribution and notional vendor financing by AECI Mining to fund the share acquisition balances empowerment with financial sustainability.
The financing was complex but strategic, enabling broad-based ownership without requiring full capital upfront. The tight timeline required rapid execution of legal, financial and governance steps, specifically to meet the B-BBEE verification deadlines.
Local Advisers: Investec Bank, Bowmans and PwC.
Comment from the Independent Panel: The panel favoured the introduction of the AECI Foundation, an established public benefit organisation with a lengthy track record. The complex transaction was executed under tight time lines.
