Sibanye-Stillwater buys French Eramet's Sandouville plant for $77mn

Sibanye-Stillwater, a leading mining company, is strategically expanding into the battery metals sector with their recent acquisition of Eramet's Sandouville plant in France for around 65 million euros. This marks their second acquisition in the battery metals sector, following their initial transaction earlier this year in Finland for a lithium project and processing facility. The move comes as Sibanye-Stillwater aims to capitalize on the increasing global demand for green technologies, particularly in electric vehicles. The Senior Vice President for Investor Relations at Sibanye-Stillwater, James Wellsted, shared insights on the acquisition and the company's future plans. The Sandouville plant is a nickel processing facility located close to the French harbor of Lahav in Normandy, providing convenient access to shipping, rail, and road infrastructure. Wellsted highlighted that the plant has the potential for upgrades and expansion, positioning Sibanye-Stillwater strategically near European end-user markets for battery-grade metals. The company had been exploring opportunities in the battery metals sector for about two years, assessing the future outlook and engaging with potential targets. Eramet, a major French company with ties to the aeronautical industry and state ownership, presented an opportunity to acquire the Sandouville plant as they sought to reallocate capital. Due to lockdown restrictions, all due diligence and negotiations were conducted remotely, with plans for an on-site visit after the deal concludes next year. Sibanye-Stillwater's immediate focus for the plant is to optimize the existing production capacity, with plans to develop a battery-metal nickel facility on unused land adjacent to the plant. This expansion is aimed at supplying high-quality nickel products to the European automotive sector for electric vehicles. While cost estimates for the development are being refined, Wellsted emphasized the company's commitment to delivering value through their strategic investments. With the automotive industry's increasing shift towards electric vehicles and sustainable practices, Sibanye-Stillwater is well-positioned to meet the growing demand for battery metals. The company already has established relationships with major auto producers like Volkswagen, Toyota, and BMW through their supply of PGMs for auto catalysts. Wellsted mentioned that discussions with potential clients for nickel supply are ongoing, with Tesla being a potential future customer. While it may be premature to engage with Tesla's CEO Elon Musk at this stage, Sibanye-Stillwater's entry into the battery metals sector signifies a significant step towards aligning their business with the evolving needs of the automotive industry. The acquisition of the Sandouville plant underscores Sibanye-Stillwater's strategic vision and proactive approach to embracing sustainable and environmentally conscious practices in the mining sector.