The U.K. High Court has ruled that Sibanye-Stillwater (NYSE: SBSW) must pay compensation to London-based Appian Capital Advisory for canceling a $1.2 billion agreement to purchase two mines in Brazil.
Appian, a private equity firm specializing in mining investments, filed a lawsuit against Sibanye after the South African mining company pulled out of the deal to acquire Atlantic Nickel and Mineração Vale Verde. These entities own the Santa Rita nickel mine and the Serrote copper mine, respectively.
Sibanye-Stillwater, a global mining enterprise and leading producer of precious metals like platinum and gold, has been working to diversify into critical metals, including copper and nickel. The proposed acquisition of the Brazilian mines was a key part of its strategy to expand into battery metals, which are essential for the energy transition.
Located in Brazil’s Bahia state, Santa Rita is among the largest open-pit nickel sulfide mines globally and also produces copper, cobalt, and platinum group metals as by-products. The mine is undergoing a transition to underground operations, which is expected to extend its life by more than 20 years. Meanwhile, the Serrote copper mine in Brazil’s Alagoas state represents another strategic asset supporting Sibanye’s move into battery and critical metals.
Sibanye withdrew from the transaction in early 2022, citing a “geotechnical event” at Santa Rita as the reason for its decision, claiming the incident would materially affect the mine’s operations. Appian contested this, arguing that Sibanye had no valid basis for canceling the deal and subsequently sued for damages.
Following a five-week trial, The Hon. Mr. Justice Butcher ruled that the alleged geotechnical event was unlikely to have a significant impact on Santa Rita’s future performance and that Sibanye’s rationale for terminating the deal was not reasonable. As a result, the court concluded that Sibanye had no legal grounds to back out of the sale and purchase agreements (SPAs).
However, Sibanye successfully defended itself against allegations of willful misconduct. The court determined that the company’s management genuinely believed they were acting in its best interests when deciding to terminate the agreement.
Appian is reportedly seeking up to $522 million in damages, according to Sibanye spokesperson James Wellsted. However, Sibanye argues that Appian is entitled to little or no compensation, claiming the mines could have been sold to another buyer for a comparable price. The company also highlighted that Appian had received multiple offers for the assets after Sibanye’s withdrawal.
The court has scheduled a separate trial for November 2025 to determine the damages Sibanye will be required to pay.
