Great Dyke Investments, a Russian-backed project planning to build Zimbabwe’s biggest platinum mine, has sold a 4.4% stake to Fossil Mines Ltd. as Covid-19 disrupted fundraising for the venture.
Fossil, owned by Zimbabwe’s Obey Chimuka, will invest $30 million in the Darwendale project, through a combination of cash and services, including for engineering, procurement and construction.
That leaves tycoon Vitaliy Machitski’s Vi Holding and Zimbabwe’s Landela Mining Venture Ltd. each with a 47.8% stake. The sale values Great Dyke Investments at $680 million.
Great Dyke Investments Chief Executive Officer Alex Ivanov said the coronavirus pandemic has delayed project fundraising, which was originally due to be completed this year.
Financing of $665 million is now expected to be finalized in the first quarter of 2021, Ivanov said in an emailed response to questions. The lead arranger for that funding is Cairo-based Afreximbank.
The Darwendale project has the potential to become one of the world’s biggest platinum mines and its development is central to the Zimbabwean government’s plans to reboot a collapsing economy.
Zimbabwe has the world’s third-largest platinum group metal reserves after South Africa and Russia. Former president Robert Mugabe handed the Darwendale concession to Russian investors in 2006 after the government repossessed land from a local unit of South Africa’s Impala Platinum Holdings Ltd.