Mining fund partnership to provide lowest risk vehicle for investing in junior mining companies
The JSS Empowerment Mining Fund, established by boutique financial consulting firm Jaltech and Stefanutti Stocks, was launched at the Mining Indaba in February 2017. Through extensive risk mitigation and tax benefits, this Section 12J fund offers attractive investment opportunities to investors. Its target capital is R1 billion.
Junior mining companies are often considered too small for traditional private equity or debt funding and hence struggle to raise capital. The JSS Empowerment Mining Fund has been created to fill this funding void and will operate in a unique niche, providing investment of between R30 million and R500 million to qualifying South African junior miners. The fund will support junior miners in respect of operational expertise and financial stability.
Construction and mining services contractor Stefanutti Stocks will provide contract mining, material handling services and mine infrastructure design and construction if required, as well as appropriate on-demand guarantees against mining production volumes and processing quality. This will vastly reduce the operating and financial risks traditionally associated with junior mining operations. Stefanutti Stocks’s particular expertise is in open cast mining operations (from mine design through to operations), however its recent alliance with Redpath Mining (South Africa) will also grant access to underground mining expertise if necessary.
The Fund’s board and investment committee members bring executive level and governance experience gained in leading (often listed) companies from various industries to the table. Board members include Chairman Mpho Makwana and directors Derrick Hyde, Mano Moodley, Gaurav Nair and Zukie Siyotula.
Potential investments will be identified and considered by the fund’s investment committee, whose members boast a broad range of relevant experience. This includes expertise in geology, mining engineering, mining operations across the whole value chain, mining investments and development, mining finance and auditing, mining contracting, and corporate and project finance. The investment committee is chaired by Zukie Siyotula and its members are Dr. John Hancox, Vinay Somera, Derrick Hyde, Frik Venter and Nthabi Ledwaba.