Table of Contents
Key Points
- African Rainbow Minerals' $160 million Elandsfontein phosphate mine faces a lawsuit from WWF over environmental concerns near South Africa’s Langebaan Lagoon.
- ARM’s headline earnings plunged 49% in H1 2025, hit by falling iron ore and PGM prices, while Harmony Gold posted strong profit growth.
- Patrice Motsepe may sell ARM’s $933 million stake in Harmony Gold, signaling a potential portfolio shift amid financial pressures and legal challenges.
South African billionaire Patrice Motsepe’s African Rainbow Minerals (ARM) is facing another legal battle, adding to the growing challenges confronting his mining empire. The company’s $160 million phosphate mine, Elandsfontein, is at the center of a lawsuit filed by the World Wildlife Fund (WWF) against South Africa’s Environment Minister, Dion George.
Elandsfontein mine faces legal hurdle
The lawsuit challenges the minister’s September decision to dismiss appeals against an offset exemption granted to Elandsfontein, which is 90 percent owned by ARM through Kropz Plc. WWF, a global conservation organization, argues that the exemption was granted despite concerns that the mine threatens the nearby Langebaan Lagoon, a crucial ecological site located 61 miles north of Cape Town. Kropz Plc has been named as a respondent in the case.
The dispute stems from an offset proposal that would have required Kropz to buy and donate more than 20,000 acres of land to the West Coast National Park. While the provincial office of the environment ministry invalidated the offset requirement in 2021, Minister George upheld the exemption last year, triggering the latest legal challenge. “The environment, and therefore the public at large, has suffered prejudice from the unconscionable delays in the implementation of the offset requirements,” WWF said in court documents filed on Mar. 13.
This is not the first time environmental groups have opposed the Elandsfontein mine. Since ARM acquired the project in 2010, the mine has faced repeated delays due to environmental concerns and technical issues, slowing its development on South Africa’s second-largest phosphate deposit. In response to the lawsuit, Kropz Plc stated that it is “noting these developments” and will consider its next steps.
ARM’s financial struggles and strategic shifts
While ARM continues to expand its mining operations across iron ore, manganese, PGMs, coal, and base metals, recent financial challenges have forced the company to reassess its strategy. Motsepe, Africa’s first Black billionaire and the wealthiest Black person in Southern Africa, owns 45.9 percent of ARM and has been diversifying his investments beyond mining to navigate industry headwinds.
His interests also extend to Harmony Gold, where he holds an 11.8 percent indirect stake. The company, which operates in South Africa, Papua New Guinea, and Australia, has shown resilience despite broader sector challenges. For the six months ending Dec. 31, 2024 (H1 2025), Harmony Gold reported a 19.3 percent rise in revenue to R35.45 billion ($2 billion), while net profit climbed 33 percent to R7.93 billion ($445 million).
ARM, on the other hand, has struggled. Headline earnings for the first half of 2025 dropped 49 percent, falling from R2.96 billion ($162.2 million) to R1.52 billion ($83.43 million). Lower iron ore and PGM prices hit ARM Platinum hard, with the division—responsible for operations at the Bokoni, Two Rivers, and Modikwa mines—reporting a headline loss of R689 million ($37.82 million), more than doubling its losses from the previous year.
Motsepe considers selling Harmony Gold stake
Amid these challenges, Motsepe has hinted at a major portfolio shift. During ARM’s interim results presentation on Mar. 8, he stated that “all options are on the table” regarding the company’s stake in Harmony Gold. Selling the stake would allow ARM to streamline its portfolio and strengthen its financial position.
Since the announcement, the value of the stake in Harmony Gold has jumped by $111.4 million in just ten days, reaching $933 million—a gain of $821.6 million overall. If he moves forward with the sale, it would free up significant capital, giving ARM more flexibility to handle ongoing legal battles, market volatility, and future growth opportunities.
