Dar es Salaam. Posco, a South Korean steel giant, has signed a binding agreement to invest $40 million in Black Rock Mining Limited, significantly increasing its stake in the Tanzanian graphite developer.
The investment, set to be executed in two tranches, will enhance Posco’s involvement in Black Rock.
The first tranche involves a $9 million investment for 155.3 million shares at a price of 5.8 cents per share—a 10 percent premium over the 10-day volume-weighted average price.
This will raise Posco’s shareholding in Black Rock from 10.1 percent to 19.99 percent. The second tranche will complete the $40 million investment at the same price as other investors in the final equity raising to support the development of Module 1, with Posco’s stake rising to 19.99 percent.
According to a statement that The Citizen has seen, the funds from Posco’s investment will be allocated to the development of Mahenge Module 1, a significant component of Black Rock’s Mahenge Graphite Project.
In return, Faru Graphite Corporation Limited (Faru), an 84 percent subsidiary of Black Rock and the owner of the Mahenge Graphite Project, will grant Posco long-term offtake rights for the fines graphite produced from Mahenge Module 2 once it is developed.
The investment remains subject to regulatory approvals, including those from the Fair Competition Commission of Tanzania, the Foreign Investment Review Board (FIRB), and shareholder approvals. Additionally, confirmation that all necessary funding for Mahenge Module 1 is in place is required.
Black Rock CEO John de Vries expressed enthusiasm about deepening the strategic partnership with Posco, viewing the investment and offtake agreement as a strong endorsement of the Mahenge Graphite Project’s future.
“Posco’s commitment is a major milestone for the company, de-risking our funding strategy and boosting confidence among our stakeholders,” de Vries stated.
POSCO Holdings Inc, with a market capitalization exceeding $22 billion, is a major South Korean steel conglomerate with a rapidly expanding battery materials division. Its battery business, Posco Future M Co., Ltd, is a leading global producer of anodes and cathodes.
Posco International Corporation, a key trading arm of Posco Holdings, will manage the raw material procurement for the group.
Black Rock Mining, listed on the Australian Securities Exchange, holds an 84 percent interest in the Mahenge Graphite Project, located in Tanzania.
The company has already achieved significant milestones, including environmental approvals, mining licenses, and a resettlement action plan.
The project has seen considerable support from Posco including a previous $7.5 million equity investment and a $10 million prepayment facility.
In September 2024, Posco approved the $40 million equity investment and secured the offtake rights for Mahenge Module 2. The collaboration builds on a strategic alliance formed in June 2020.
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Britam half-year net profit hits Sh2bn on higher investment income
Insurer and financial services provider Britam posted a 22.5 percent jump in net earnings for the half-year ended June 2024, to Sh2 billion, buoyed by increased investment income.
The rise in half-year net profit from Sh1.64 billion posted in a similar period last year came on the back of net investment income rising 2.5 times to Sh13.27 billion from Sh5.3 billion.
“We are confident in the growth and performance trend that Britam has achieved, supported by its subsidiaries in Kenya and the region. Our business is expanding its revenue base while effectively managing costs,” Britam Chief Executive Officer Tom Gitogo said.
“Our customer-centric approach is fueling growth in our customer base and product uptake, particularly through micro-insurance, partnerships, and digital channels.”
The investment income growth was fueled by interest and dividend income rising 34 percent to Sh9.1 billion, which the insurer attributed to growth in revenue and the gains from the realignment of the group’s investment portfolio.
Britam also booked a Sh3.79 billion gain on financial assets at a fair value, compared with a Sh1.8 billion loss posted in a similar period last year.
The increased investment income helped offset the 12.7 percent decline in net insurance service result to Sh2.13 billion in the wake of claims paid out rising at a faster pace than that of premiums received.
Britam said insurance revenue, which is money from written premiums, increased to Sh17.8 billion from Sh16.6 billion, primarily driven by growth in the Kenya insurance business and regional general insurance businesses, which contributed 30 percent of the revenue.
The group has a presence in seven countries in Africa namely Kenya, Uganda, Tanzania, Rwanda, South Sudan, Mozambique, and Malawi.
Britam’s insurance service expense hit Sh13.6 billion from Sh11.3 billion, while net insurance finance expenses rose 2.6 times to Sh12.3 billion during the same period.
“Net insurance finance expenses increased mainly due to growth in interest cost for the deposit administration business driven by better investment performance. This has also been impacted by a decline in the yield curve, which has led to an increase in the insurance contract liabilities. The increase has been offset by a matching increase in fair value gain on assets,” said Britam.
Britam’s growth in profit is in line with that of other Nairobi Securities Exchange-listed insurers, which have seen a rise in profits.
Jubilee Holdings net profit in the six months increased by 22.7 percent to Sh2.5 billion on increased income from insurance, helping the insurer maintain Sh2 per share interim dividend.
CIC Insurance Group posted a 0.64 percent rise in net profit to Sh709.99 million in the same period as net earnings of Liberty Kenya nearly tripled to Sh632 million from Sh213 million, while Sanlam Kenya emerged from a loss to post a Sh282.2 million net profit.
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