Modern Mining February 2020

JUNIOR MINING

Afrimat’s quest to become Following a successful entry into the commodity space through the acquisition of an iron ore operation some three years ago, new business development remains a critical component of Afrimat’s growth strategy. CEO Andries van Heerden tells Munesu Shoko that the company has identified further opportunities in both existing markets and anticipated new high-growth areas in its quest to become a ‘serious’ junior miner.

S ome three years ago, Afrimat took a seemingly new business direction with the acquisition of Demeneng iron ore mine, pre- viously known as Diro Manganese. This gave the leading open-pit mining company a foothold into the commodities space, adding to its traditional industrial min- erals (limestone, dolomite and silica) and construction materi- als (aggregates and readymix) businesses. CEO Andries van Heerden says iron ore was a logical step for Afrimat, given the operational aspects are similar to its traditional businesses. There are several fun- damental aspects of the iron ore business that remain the same with the company’s traditional portfolios – opencast operation, conventional drill and blast, load and haul, primary and secondary crushing and screening.

“Essentially, the move into iron ore was about leveraging our competencies in a new sector, but more importantly diluting our expo- sure to the cyclical nature of the construction sector,” explains Van Heerden. “In addition, it allowed us to earn USD‑based revenue, provid- ing significant hedge against the turbulence of the local currency.” Van Heerden says as part of its diversifica- tion strategy, Afrimat has always maintained that it will acquire operations it believes – based on fundamentals – will provide solid returns, and have inherent competitive advantages such as unique metallurgy, cost structure and loca- tion. This is exactly what Demaneng offers: the mine’s product is of high quality with low contaminants and good physical properties, in addition to low stripping ratios and good access to infrastructure. Quick turnaround Afrimat has over the years demonstrated its prowess in corporate revitalisation, exhibited by its approach of acquiring businesses in distress

CEO Andries van Heerden wants Afrimat to be a serious junior miner in South Africa. Right: Afrimat first ventured into the commodity space when it purchased Demaneng mine some three years ago.

18  MODERN MINING  February 2020