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ORION Minerals’ anchor shareholder Tembo Capital Management, a UK-based private equity firm, has sold its stake of about 12% in the copper development company.
Just under half the shares sold by Tembo Capital were bought by Tom Borman, a former Orion Minerals board member and its current financial backer. He has now lifted his stake in Orion to 14.32%. The balance of Tembo Capital’s stake, held through a Dutch subsidiary, was sold to a second, undisclosed second party.
This was the takeaway from two statements published by Orion Minerals on the JSE’s stock exchange news service on Thursday. The announcements showed that Tembo had sold a total of 1.08 billion shares – 12.1% of Orion – for a total of A$20.55m. The shares were sold at 1.9 Australian cents each, a 16% discount to Orion’s closing ASX price of 2.25c.
Shares in Orion fell just over 4% on the ASX.
Borman’s stake is still well below the 20% level at which Australian takeover rules apply. Going past 20% would generally require a takeover bid or another permitted route, such as “creep” of up to 3% every six months.
Miningmx understands that the Tembo Capital Mining Fund II, the vehicle named in the announcements, is being wound up. The announcements do not say whether Tembo has retained a residual stake in Orion.
Orion Minerals is developing the previously operated Prieska Copper-Zinc Mine in the Northern Cape, which is slated to produce 22,000 tons of copper and 65,000 tons of zinc a year. It is also developing Okiep Copper, another brownfields project in the province. First production from PCZM has been targeted for the third quarter of 2027.
A major catalyst for Orion was a $250m prepayment under a concentrate offtake arrangement with Glencore, announced last year. The South African Reserve Bank recently approved the transaction, but the funds have not yet been drawn down. Glencore is in discussions with Triple Flag, a Canadian company that has a streaming deal with Orion covering by-products, including gold.
The exit of Tembo is a significant moment for Orion Minerals if only because the UK fund has been a cornerstone investor, first taking shares in the minerals development firm in May 2017 with a A$3m share placement.
Its participation in Orion Minerals grew from there via Ndlovu Capital, its vehicle. All in all, Tembo once owned 23% of Orion by agreement with shareholders. Tembo also provided a convertible loan facility to Orion Minerals, and backed later funding rounds for PCZM.