Analysts Have Reservations Regarding Eastplats Sale

Though Eastern Platinum’s (TSX:ELR) sale of its assets to Hebei Zhongbo Platinum last week was viewed as possible by many, some were hesitant regarding the deal, according to the Globe and Mail. According to the publication, the company suspended its Crocodile River platinum project last year, and South Africa’s Business day put the headline “Strapped Eastplats throws in the towel,” on the story.

As quoted in the Globe:

Analysts at Raymond James, in their reaction on Monday, said the “surprise announcement” was “remarkably short on details.” They said they had several reservations about the proposed sale. Failing to close the sale or provide further clarity on it could expose the company to litigation risk, they said.

The other Canadian platinum miners, however, are upbeat about their prospects in South Africa. Ivanhoe had threatened to cut jobs at the mining project if it didn’t get approval from the government, but it scrapped that plan after receiving the approval last week.

Click here to read the full Globe and Mail article.