PIC Increases Stake in Northam Platinum and Pepkor Holdings
The Public Investment Corporation (PIC) has raised its stake in Northam Platinum to 20%, reinforcing its commitment to the long-term prospects of platinum group metals (PGMs). This follows the PIC’s move last year to increase its holding in Sibanye-Stillwater to 15%, as the asset manager continues to back the green economy potential of PGMs, particularly in the hydrogen sector. South Africa produces over 50% of the world’s platinum, primarily from the Bushveld Complex, making PGMs a cornerstone of its mining industry.
Northam Platinum, valued at R44.3 billion (approximately USD 2.4 billion) on the Johannesburg Stock Exchange (JSE), has drawn significant investor interest in recent months. In October, Coronation Fund Managers acquired a 5% stake in the company, revising its stance on PGMs after earlier disinvestment due to weak prices and demand.
While the PGM market has faced challenges over the past two years, including job cuts and price pressures from the rise of battery electric vehicles (EVs), hybrid vehicles are driving renewed demand for catalytic converters. Hybrid cars, which typically require higher PGM loadings than internal-combustion engine vehicles, are gaining popularity as EV growth tapers in some regions. Sibanye-Stillwater noted in April that PGMs have a substantial future in automotive applications, supported by the emerging hydrogen economy.
Platinum’s role in hydrogen electrolysers, crucial for zero-emission hydrogen production, has gained attention. The European Commission’s recent allocation of €7 billion for over 30 hydrogen projects underscores the sector’s growth potential. Industry leaders, including Anglo American CEO Duncan Wanblad, have highlighted hybrids as a pragmatic alternative to pure battery EVs in many markets.
The PIC also played a central role in a major deal in 2023, enabling Impala Platinum (Implats) to acquire a controlling share in Royal Bafokeng Platinum. Northam had competed with Implats for control of Royal Bafokeng but withdrew after a protracted bidding war.
In a separate strategic move, the PIC increased its stake in Pepkor Holdings to 15%, targeting growth in the retail and financial technology segments. Pepkor, valued at R101 billion (approximately USD 5.5 billion) on the JSE, reported a return to profitability for the financial year ending September 2024. The group posted a profit before tax of R3.7 billion (approximately USD 200 million), rebounding from a R502 million (approximately USD 27 million) loss in the prior year. Revenue rose by 7.8% to R85.1 billion (approximately USD 4.6 billion), with clothing and general merchandise contributing R61.4 billion (approximately USD 3.3 billion).
Pepkor plans to open 250 to 300 new stores in 2025, anticipating improved consumer spending as food prices stabilize and electricity supply becomes more reliable.
