Nikanor Plc

Nikanor

Founded	July 2006
Defunct	January 2008
Headquarters	London, England
Area served	Democratic Republic of the Congo

Nikanor Plc was a copper and cobalt mining company active in Katanga Province, Democratic Republic of the Congo. In January 2008 it was merged into Katanga Mining. Katanga paid US$452 million in cash to Nikanor Shareholders.^[1]

Formation

Dan Gertler is a diamond dealer and close friend of DRC president Joseph Kabila. In March 2004, Dan Gertler International in partnership with Beny Steinmetz Global founded a firm named Global Enterprises Corporate (GEC). In May 2004 GEC signed a preliminary agreement with the state-owned Gécamines, finalized in September that year, to rehabilitate and operate the Kananga and Tilwezembe mines. The deal was ratified by presidential decree^[2]

Operation

The two companies formed a subsidiary named DCP, 75% owned by GEC and 25% by Gécamines, and transferred exploitation permits for the pproperties to this subsidiary in 2006. The DCP properties were located next to Katanga Mining's properties near Kolwezi.^[1] Output was estimated to be able to reach 200,000 tons of copper annually. The only SX-EW refining plant in the region was at Luilu. A few months earlier Gécamines had granted management of the plant to George Forrest's Kinross-Forrest subsidiary. In September 2005 an agreement was reached for GEC and Kinross-Forrest to share the refinery. It was rumored that Gertler had used pressure from Kabila to obtain the concession.^[2]

Gertler and Steinmetz placed GEC'S 75% share in KOV into Nikanor Plc., registered in the Isle of Man. Nikanor's stock was listed on on the LSE's Alternative Investment Market in London in July 2006. The IPO raised $400 million, and Nikanor's market capitalization reached $1.5 billion.^[2] This value was based on its interests in the huge KOV (Komoto Oliveira Virgule) open cast copper-cobalt project including the Tilwezembe and Kananga deposits and the Kolwesi concentrator. As of April 2007 capital expenditure on stage one of the KOV project was estimated at $1.6 billion, and total required funding was estimated at $1.8 billion. By this time the company's market capitalization had fallen to £517m. ^[2]

Takeover

In January 2008 Katanga Mining acquired Nikanor PLC for $452m.^[1] Following the friendly merger of the Katanga Mining and Nikanor assets, there was speculation that the Dikuluwe and Mashamba West deposits were being transferred to Gécamines, and would be exploited by a joint venture owned 32% by Gécamines and 68% by a Chinese consortium.^[3] In February 2008 it was confirmed that Katanga Mining was selling Dikuluwe and Mashamba West to Gécamines for $825 million.^[4]

References

1. ^ ^{a b c} "History". Katanga Mining. http://www.katangamining.com/kat/about_us/history/. Retrieved 2011-11-16. 
2. ^ ^{a b c d} Barry Sergeant (03 Apr 2007). "Nikanor’s DRC mining contract quandary". http://www.mineweb.net/mineweb/view/mineweb/en/page36?oid=19037&sn=Detail. Retrieved 2011-11-16. 
3. ^ Barry Sergeant (29 Jan 2008). "Katanga Mining's DRC/China copper/cobalt conundrum". MineWeb. http://www.mineweb.com/mineweb/view/mineweb/en/page36?oid=45469&sn=Detail. Retrieved 2011-11-10. 
4. ^ Liezel Hill (8th February 2008). "Katanga agrees to sell DRC deposits to govt for $825m". Mining Weekly. http://www.miningweekly.com/article/katanga-agrees-to-sell-drc-deposits-to-govt-for-825m-2008-02-08. Retrieved 2011-11-10.