Friedland's private mining firm attracts interest

Friedland's private mining firm attracts interest - African Minerals draws speculators

The Globe and Mail (Canada) - Allan Robinson, Mining Reporter

August 12 2002

Toronto - A private company controlled by mine promoter Robert Friedland has a major platinum and palladium exploration program under way in South Africa that is attracting a lot of speculative interest.

African Minerals Ltd. of Vancouver, which is an affiliate of Mr. Friedland's Singapore-based Ivanhoe Capital Corp.,has an implied market capitalization of more than $600-million based on the recent private sale of some of its shares, mining industry sources said.

Mr. Friedland puts the figure at closer to $475-million. The shareholders in the private company include a major Canadian bank, pension funds and mutual funds, he said.

Some mutual funds buy stakes in private companies in anticipation of them going public, said one fund manager whose fund used to own African Minerals but sold the holding.

C.A. Delaney Capital Management Ltd., a Toronto mutual fund manager headed by Kiki Delaney, handled the sale of some African Mineral shares, according to one regulatory filing in September, 1999. The company did not return calls.

African Minerals has been in business for several years. It has other assets, including properties in Congo and Zambia, but the "heart of the company" is the platinum and palladium exploration program under way in South Africa, Mr. Friedland said.

Although reluctant to comment on the private company dealings, Mr. Friedland, who is co-chairman and acting president, said his ownership of African Minerals is just under 50 per cent. But for a private company, it boasts some high-profile directors. The other co-chairman is Moses Mayekiso, a former leader in South Africa's anti-apartheid movement and once the head of the National Union of Metalworkers in South Africa. The board of directors also includes mining executives Hugo Dummett and Sam Jonah. Mr. Dummett is an internationally known geologist and, in Canadian mining circles, is highly regarded as an expert in diamond exploration. He was once the head of exploration for what is now known as BHP Billiton PLC of Australia.

Mr. Jonah is the chief executive officer of Ghana's Ashanti Goldfields Co. Ltd.

"We are private because it suits us to be private," Mr. Friedland said. All of the strategic options are open, including going public or perhaps making a deal with other mining companies or automotive manufacturers interested in the platinum and palladium property, he said. "We're not rushing to go public."

Platinum and palladium are used in the automotive and electronic industries as well as for jewellery. The two metals are used to manufacture capacitors, which are critical components for regulating the flow of electricity, and catalytic converters, which filter car exhausts.

The company is more than willing to be part of the South African government's plans to develop economic growth including the black empowerment initiatives, which would see groups such as unions assume ownership interests in new mines, Mr. Friedland said. "The government is anxious to have new players in the [mining] industry," he said.

Mr. Friedland was in Toronto last week to promote his Toronto Stock Exchange listed Ivanhoe Mines Ltd. of Vancouver. He had just returned from leading a tour of analysts and investors to Ivanhoe's copper and gold exploration properties in Mongolia.

The company has 11 drill rigs in operation and plans to add another six, he said. He has a 53-per-cent interest in Ivanhoe.

African Minerals has 12 drill rigs exploring its property in South Africa. The private market value of African Minerals has soared and it could play a part in an emerging stock market play.

About a month ago, African Minerals moved a couple of its drill rigs to an adjacent property owned by Anooraq Resources Corp. of Vancouver, which trades on the TSX Venture Exchange.

African Minerals has drilled holes on its Turfspruit property right up to the boundary of Anooraq's Rietfontein property, mine promoter Robert Dickinson said.

African Minerals has an option to acquire a 50-per-cent interest and to be the operator of Anooraq's Rietfontein farm, a 2,900-hectare property that is adjacent to and southeast of a mining complex owned by South Africa's Anglo American Platinum Corp. In South Africa the word "farm" is a term used to describe a mineral interest. The Rietfontein farm is 275 kilometres northeast of Johannesburg. Anooraq is part of the Vancouver-based Hunter Dickinson Inc.group of companies and Anooraq's co-chairmen are Mr. Dickinson and another mining promoter Robert Hunter.

The Hunter Dickinson group recently raised a total of $10-million from Middle Eastern funds for eight of their companies, including Anooraq.